News

America’s Roundup: U.S. dollar regains traction in FX markets, Wall Street drops, Gold retreats from near eight-year peak, Oil steadies as economic data overshadows coronavirus worries-July 8th,2020

Market Roundup

• US Redbook (MoM) -0.6%, -0.7% previous

• US Redbook (YoY) -6.9%,-5.7% previous

• Canada June Ivey PMI 58.2, 39.1 previous

• US May JOLTs Job Openings 5.397M, 4.850M, 5.046M previous

• Canada June Ivey PMI n.s.a 62.9, 42.1 previous

• New Zealand GlobalDairyTrade Price Index 8.3%, 1.9% previous

Looking Ahead – Economic Data (GMT)

• 23:50 Japan May Current Account n.s.a 1.088T forecast, 0.263T previous

• 23:50 Japan June Bank Lending (YoY) 4.8% previous

• 05:00 Japan June Economy Watchers Current Index 15.5 previous

Looking Ahead – Economic events and other releases (GMT)

• No significant events

Currencies summaries

EUR/USD: The euro declined against dollar on Tuesday as forecasts for a deeper-than-feared recession in the euro zone dimmed optimism post-Coronavirus pandemic. European Commission said the euro zone economy would drop deeper into recession this year and rebound less steeply in 2021 than previously thought. Traders remain hopeful that central banks will continue to buy government bonds and other financial assets to protect their economies from the coronavirus pandemic. Immediate resistance can be seen at 1.1295 (23.6% fib), an upside break can trigger rise towards 1.1372 (Daily high).On the downside, immediate support is seen at 1.1253 (20 DMA), a break below could take the pair towards 1.1200 (Psychological level).

GBP/USD: Sterling rose against dollar on Tuesday, as sterling was boosted on optimism that British and EU trade negotiators could find common ground . Investors are also awaiting details of the government’s plans to support the British economy, with Chancellor Rishi Sunak due to unveil more spending measures on Wednesday. That would be on top of Prime Minister Johnson’s announcement a week ago of 5 billion pounds ($6.29 billion) in infrastructure investment. The pound rose to as high as $1.2579 against the dollar, approaching the June 18 high of $1.2588. Immediate resistance can be seen at 1.2572 (38.2% fib), an upside break can trigger rise towards 1.2685 (Higher BB).On the downside, immediate support is seen at 1.2506 (5DMA), a break below could take the pair towards 1.2444 (11DMA).

USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Tuesday as investors grew more worried about renewed coronavirus lockdowns slowing economic recovery, with the loonie pulling back from a near two-week high the day before.A five-day charge by world stocks fizzled after pandemic lockdown measures were reimposed in Melbourne, Australia, and large parts of the United States reported tens of thousands of new coronavirus infections. Immediate resistance can be seen at 1.3629(38.2%fib), an upside break can trigger rise towards 1.3693 (Higher BB).On the downside, immediate support is seen at 1.3522 (July 7th low), a break below could take the pair towards 1.3473 (23.6% fib).

USD/JPY: The dollar gained against the Japanese yen on Tuesday as yen was pressured by a rise in demand for the dollar, as investors took a breather from stocks and other riskier investments after several days of gains. A sharp rebound in U.S. services industry activity in June, almost returning to pre-pandemic levels, also helped appetite for dollar. At 1215 GMT, the dollar was 0.34 percent lower versus the Japanese yen at 107.70 Strong resistance can be seen at 107.83 (July 7th high), an upside break can trigger rise towards 108.07 (Higher BB).On the downside, immediate support is seen at 107.44 (50% fib ), a break below could take the pair towards 107.25 (50% fib ).

Equities Recap

European shares fell on Tuesday as surging U.S. coronavirus cases and forecasts for a deeper-than-feared recession in the euro zone dimmed optimism around a post-pandemic rebound.

UK’s benchmark FTSE 100 closed down by 1.53 percent, Germany’s Dax ended down by 0.92 percent, France’s CAC finished the day down by 0.74 percent.

The S&P 500 eased on Tuesday, a day after the benchmark index logged its longest streak of gains this year as investors weighed the risk of a sharp jump in new coronavirus cases nationwide hindering a rebound in economic activity.

Dow Jones closed down by 1.52 percent, S&P 500 was ended down by 1.08 percent, Nasdaq was down by 0.86 % percent.

Treasuries Recap

U.S. Treasury yields fell on Tuesday as a worsening COVID-19 caseload aggravated concerns about reopening businesses too quickly.

The benchmark 10-year yield was down 3.3 basis points in afternoon trading at 0.6512%.

Commodities Recap

Oil prices settled little changed on Tuesday as demand concerns due to a new surge in coronavirus cases overshadowed U.S. government forecasts for lower production.

Brent crude futures settled at $43.08 a barrel, down 2 cents in the session. U.S. West Texas Intermediate settled down 1 cent at $40.62 a barrel.

Gold dipped on Tuesday as investors booked profits after bullion rallied to a near eight-year peak and as demand for dollars rose amid a new surge in COVID-19 cases.

Spot gold slipped 0.3% to $1,777.72 per ounce by 1213 GMT after earlier touching a high of $1,786.91, just short of Wednesday’s nearly eight-year peak of $1,788.96.U.S. gold futures fell 0.4% to $1,785.70 per ounce.


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