News

America’s Roundup: Dollar falls to two-year low, Wall Street rises, Gold hits record high, Oil rises on hopes for U.S. stimulus measure-July 28th,2020

Market Roundup

• U.S.-China tensions keep investors on edge

• Earnings, U.S. stimulus talks in focus

• US June Durable Goods Orders (MoM) 7.3%,7.2% forecast, 15.7% previous

• US June Durables Excluding Defense (MoM) 9.2%, 15.3% previous

• US June Core Durable Goods Orders (MoM) 3.3% 3.5%, forecast, 3.7% previous

• US June Goods Orders Non Defense Ex Air (MoM) 3.3%,2.3% forecast, 1.6% previous

• US July Dallas Fed Mfg Business Index -3.0, -6.1 previous

• US 6-Month Bill Auction 0.130%,0.130% previous

• US 2-Year Note Auction0.155%,0.193% previous

• US 3-Month Bill Auction 0.105%,0.120% previous

Looking Ahead – Economic data

• 23:50 Japan Corporate Services Price Index (CSPI) 0.8% previous

Looking Ahead – Economic events and other releases (GMT)

• No Significant events

Currency summaries

EUR/USD: The euro strengthened against the U.S. dollar on Monday, as weakening dollar and concerns about a growing number of coronavirus cases boosted euro before the Federal Reserve meeting. The Fed is expected to reiterate that it will keep rates near zero for years to come when it concludes its two-day meeting on Wednesday. The euro was last up 0.04% at $1.1755, after earlier reaching $1.1763, the highest since September 2018.Immediate resistance can be seen at 1.1776 (Hgher BB), an upside break can trigger rise towards 1.1832 (23.6% fib).On the downside, immediate support is seen at 1.1764 (38.2%fib), a break below could take the pair towards 1.1665 (5 DMA).

GBP/USD: Sterling strengthened against dollar on Monday as sterling was pushed up by weaker dollar across the board but, uncertainty over Brexit and Britain’s economic prospects kept gain in check. Britain and the European Union clashed last week over the chances of securing a free trade agreement, with Brussels deeming it unlikely but London holding out hope one could be reached in September. The pound was last up 0.4% versus the dollar at $1.2889. Immediate resistance can be seen at 1.2923 (Higher BB), an upside break can trigger rise towards 1.2992 (23.6% fib).On the downside, immediate support is seen at 1.2808 (5 DMA), a break below could take the pair towards 1.2716 (38.2% fib).

USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Monday as oil prices rose and the greenback again declined against a basket of major currencies, with the loonie approaching a six-week high notched last week. The Canadian dollar was trading 0.4% higher at 1.3366 to the greenback, or 74.82 U.S. cents. The currency traded in a range of 1.3354 to 1.3413.Last Thursday, the loonie touched its strongest intraday level since June 10, at 1.3347.Immediate resistance can be seen at 1.4150 (Daily high), an upside break can trigger rise towards 1.4318 (Higher BB).On the downside, immediate support is seen at 1.3324 (Lower BB), a break below could take the pair towards 1.3300 (Psychological level).

USD/JPY: The dollar declined against the Japanese yen on Monday as dollar was weighed by deteriorating U.S.-China relations and concerns about the U.S. economy as COVID-19 infections climbed. In the latest escalation of Sino-U.S. tensions, China took over the premises of the U.S. consulate in the southwestern city of Chengdu on Monday in retaliation for Beijing’s ouster last week from its consulate in Houston, Texas. This sent the dollar index to its lowest in two years. Investors are now awaiting the U.S. Federal Reserve’s meeting starting Tuesday, where it could flag another accommodative policy shift. Strong resistance can be seen at 106.11(Daily high), an upside break can trigger rise towards 106.43 (38.2%fib).On the downside, immediate support is seen at 105.22 (23.6% fib), a break below could take the pair towards 105.00 (Psychological level).

Equities Recap

European shares slipped on Monday with travel stocks leading the declines after Britain imposed a two-week quarantine on travellers returning from Spain after a surge in coronavirus cases.

UK’s benchmark FTSE 100 closed down by 0.31 percent, Germany’s Dax ended up by 0.02 percent, France’s CAC finished the day down by 0.34 percent.

Wall Street’s main indexes closed higher on Monday as investors bet on some of the market’s most high-profile stocks ahead of earnings reports while they weighed progress in U.S. government stimulus efforts against rising U.S. COVID-19 cases.

Dow Jones closed up by 0.43 %percent, S&P 500 closed up 0.76% percent, Nasdaq settled up by 1.67 % percent.

Treasuries Recap

U.S. Treasury yields rose back after declines on Monday as investors showed continued demand for notes at auction and prepared for a dovish message from the U.S. Federal Reserve later this week.

The benchmark 10-year yield was up one basis point at 0.5987% in afternoon trading after reaching as low at 0.569% earlier in the session.

Commodities Recap

Gold stormed to a record high on Monday as investors sought refuge from the possible hit to a pandemic-stricken global economy from an escalation in the U.S.-China spat, which pummelled the dollar.

Spot gold hit a record high of $1,945.16 per ounce, and rose 2% to $1,938.27 by 12:29 p.m EDT (1629 GMT). U.S. gold futures gained 1.8% to $1,931.40.

Oil prices rose on Monday on hopes that stimulus efforts will help revitalize the U.S. economy, but the gains were capped by rising coronavirus cases and tensions between Washington and Beijing.

Brent crude rose 7 cents to settle at $43.41 a barrel, while U.S. West Texas Intermediate (WTI) crude rose 31 cents to settle at $41.60 a barrel.


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