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Europe Roundup: Euro gains as Fed support fails to lift dollar, European shares gains, Gold rises, Oil jumps towards $28 on Fed steps to support economy-March 24th,2020

Market Roundup

• French March Markit Composite PMI 30.2,39.8 forecast, 52.0 previous

• French March Services PMI 29.0, 42.0 forecast, 52.5 previous

• German March Composite PMI  37.2, 40.6    forecast , 50.7 previous

• German March Manufacturing PMI  45.7, 39.6 forecast, 48.0 previous

• German March Services PMI  34.5, 42.3 forecast, 52.5 previous

• Eurozone March Manufacturing PMI  44.8, 39.0 forecast, 49.2 previous

• Eurozone March  Services PMI  28.4, 39.0 forecast, 52.6 previous

• UK Composite PMI  37.1, 45.1 forecast, 53.0 previous

• UK Manufacturing PMI 48.0, 45.0    forecast, 51.7 previous

• UK Services PMI 35.7, 45.0 forecast, 53.2 previous

• UK March CBI Industrial Trends Orders  -29, -35 forecast, -18  previous

 • Brazil   Jan Retail Sales (MoM)  -1.0%,-0.6% forecast, -0.1% previous

• Brazil Jan Retail Sales (YoY)  1.3%,2.5% forecast, 2.6% previous    

Looking Ahead - Economic Data (GMT) 
• 13:45 US March Manufacturing PMI  42.8, 50.7 previous

• 13:45 US Services PMI March 42.0, 49.4 previous    

• 14:00 US Feb New Home Sales (MoM)  -2.0%,7.9% previous

• 14:00 US Feb New Home Sales  750K, 764K previous

• 14:00 US March Richmond Manufacturing Shipments 1 previous

• 14:00 US March Richmond Services Index  26 previous

Looking Ahead - Events, Other Releases (GMT)

• No significant events


EUR/USD: The euro strengthened on Tuesday as dollar slipped as investors pinned hopes on unprecedented stimulus steps by the U.S Federal Reserve and other policymakers to ease strains in financial markets. While the measures such as the Fed’s offer of unlimited bond-buying won’t immediately mitigate the economic devastation inflicted by the coronavirus outbreak, they will launch more dollars into world markets, allowing companies, funds and banks to access cash to pay creditors, supplier and end-investors. Immediate resistance can be seen at 1.0848 (50% fib), an upside break can trigger rise towards 1.0891 (61.8%fib).On the downside, immediate support is seen at 1.0771 (5 DMA), a break below could take the pair towards 1.0739 (23.6% fib).

GBP/USD: Sterling rallied more than 1.5% against the dollar on Tuesday, winning a respite from a battering in recent days. Sterling, along with most currencies, has seen a massive wave of selling against the U.S. dollar, the world’s most liquid currency and the safe haven of choice when confidence evaporates from financial markets. It has also been hurt by concerns over Britain’s approach to dealing with the coronavirus outbreak, which has seen a more staggered disruption to economic and everyday life than in other countries. Immediate resistance can be seen at 1.17800  (61.8% fib), an upside break can trigger rise towards 1.1900 (9 DMA).On the downside, immediate support is seen at 1.1676 (50% fib), a break below could take the pair towards 1.1578 (38.2% fib).

USD/CHF: The dollar declined against the Swiss franc on Tuesday after the U.S. Federal Reserve stepped up measures to shield an economy reeling from emergency restrictions on commerce to fight the coronavirus. The dollar fell 1% to 101.04, down more than 1.5% from Monday’s highs and having hit a more than three-year high of 102.99 on Friday. It was on track for its biggest single-day drop in three weeks. The Fed announced various programs including purchases of corporate bonds, guarantees for direct loans to companies and a plan to get credit to small and medium-sized business. Immediate resistance can be seen at 0.9848 (Daily high), an upside break can trigger rise towards 0.9922 (Higher BB).On the downside, immediate support is seen at 0.9716  (Daily low), a break below could take the pair towards 0.9610 (11 DMA).

USD/JPY: The dollar edged lower against the Japanese yen Tuesday after a massive array of new programs from the U.S. Federal Reserve underscored the “severe” disruptions the coronavirus pandemic poses to a fast-weakening world economy. Traditional safe-havens such as Japanese yen, gold, U.S. Treasury rose as the outlook for global growth grew dimmer. The Fed’s moves put pressure on the U.S. dollar, which has risen sharply as the panic-selling drives investors toward the liquidity of the greenback and to dollar-denominated assets. Strong resistance can be seen at 111.00 (38.2% fib), an upside break can trigger rise towards 112.40 (23.6% fib).On the downside, immediate support is seen at 110.45 (50 % fib), a break below could take the pair towards 109.62 (61.8 % fib). 

Equities Recap

European shares attempted another rebound on Tuesday as a fresh wave of monetary and fiscal stimulus halted a global selloff in equity markets, but growing evidence of the economic damage from the coronavirus pandemic kept investors on edge.

At (GMT 13:33),UK's benchmark FTSE 100 was last trading up at 5.24 percent, Germany's Dax was up by 7.23 percent, France’s CAC finished was up by 5.48 percent.

Commodities Recap

Gold rose 2% on Tuesday, extending gains from a near 4% surge in the previous session, after the U.S. Federal Reserve's unprecedented measures to help an economy reeling from the coronavirus pandemic halted a rush for cash.

Spot gold rose 1.3% to $1,572.45 per ounce by 0637 GMT. The metal rose 3.7% on Monday, its highest percentage gain since June 2016.    

Treasuries Recap

Euro zone bond yields reacted little to a historic slump in the region’s business activity on Tuesday, with March purchasing manager index (PMI) readings laying bare the extent of the coronavirus outbreak’s impact on the bloc’s economies.    

Germany’s 10-year yield was up 2 basis points on the day at -0.36%, compared with a 4 bps rise before the PMI releases , small moves when compared to record lows hit at -0.90% earlier in March.

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