America’s Roundup: Dollar eases on uncertainty over US stimulus plans, Wall Street tumbles, Gold rises 1%,Oil falls as Saudi, UAE plan for higher output capacity-March 12th,2020

Market Roundup

• Price of U.S. oil declines 4%

• U.S. stocks slip about 4%, halting Tuesday’s rally

• Markets fully price in ECB rate cut for Thursday

• US Feb Chicago Fed National Activity -0.67  , -0.71 previous

• US Feb Core CPI (YoY)  2.4%,2.3% forecast, 2.3% previous

• US Feb Core CPI (MoM)  0.2%,0.2% forecast, 0.2% previous

• US Feb Core CPI Index  267.07, 266.48    previous

• US Feb CPI (MoM)  0.1%,0.2%    forecast, 0.1% previous

• US Feb Real Earnings (MoM)  0.5%, 0.1% forecast, 0.1% previous

• US Crude Oil Inventories 7.664M, 2.266M forecast, 0.785M previous

• US Gasoline Inventories -5.048M, -2.482M forecast, -4.340M previous

• US Feb Federal Budget Balance -236.3B, 236.3B forecast, -33.0B previous

Looking Ahead - Economic Data (GMT)  
 
• 23:50 Japan BSI Large Manufacturing Conditions (Q1) -7.8    

• 23:50 Japan Foreign Bonds Buying -489.7B previous        

• 23:50 Japan Foreign Investments in Japanese Stocks -745.0B previous    
    
• 23:50 Japan Feb PPI (MoM)  -0.3%,0.2%    previous    

• 00:30 Australia MI Inflation Expectations 4.6%, 4.0% previous
                                    
Looking Ahead - Economic events and other releases (GMT)    

• No significant events

EUR/USD: EUR/USD: The euro declined against the U.S. dollar on Wednesday, as investors awaited rate decision by European Central Bank. European Central Bank is expected boost monetary stimulus when it meets on Thursday to counter the impact of the coronavirus outbreak on the European economy. Following a 50-basis point rate cut from the Bank of England, expectations are the ECB will also act, probably with a 10-basis point cut. Money markets showed that a 10-basis point rate cut is now being fully priced in by investors. The euro was last down 0.10% at $1.1257. Immediate resistance can be seen at 1.1138 (21 DMA), an upside break can trigger rise towards 1.1200 (Psychological level).On the downside, immediate support is seen at 1.1084 (Daily low), a break below could take the pair towards 1.1057 (Lower BB).

GBP/USD: Sterling declined against dollar on Wednesday, as after the British government unveiled a 30 billion pound ($39 billion) economic stimulus plan, hours after the Bank of England slashed interest rates to lift the struggling economy. In a double-barrelled response to tackle the risk of a coronavirus-fuelled recession, the government announced the plan as part of a debt-fuelled investment surge after the central bank cut its key policy rate to 0.25%, lifting the pound from a one-week low hit in the previous session. Sterling earlier rebounded on the BoE’s 50 basis-point rate cut, but the pound eventually fell, tracking the drop in stocks and risk appetite overall, sliding 0.6% to $1.2835. Immediate resistance can be seen at 1.3102 (5 DMA), an upside break can trigger rise towards 1.3331 (Higher BB).On the downside, immediate support is seen at 1.3000 (Psychological level), a break below could take the pair towards 1.2905 (Lower BB).

USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Wednesday as global equity markets, including the commodity-linked Toronto Stock Exchange, tumbled after the World Health Organization deemed the coronavirus outbreak a pandemic. At (1933 GMT), the Canadian dollar was trading 0.3% lower at 1.3776 to the greenback. The currency, which on Tuesday hit a four-year low at 1.3796, traded in a range of 1.3682 to 1.3779. Immediate resistance can be seen at 1.3106 (Jan 9th High), an upside break can trigger rise towards 1.3173 (50 DMA).On the downside, immediate support is seen at 1.3065 (5 DMA), a break below could take the pair towards 1.3033(11 DMA).

USD/JPY:The dollar declined against the Japanese yen on Wednesday, as fears over the spreading coronavirus pushed investors into safe havens.  Investors were also disappointed as President Donald Trump made no major announcements on stimulus measures. Expectations that Trump will unveil a significant stimulus plan had bolstered risk appetite on Tuesday. The dollar was down sharply against the safe-haven yen. It lost 0.9% to 104.72 yen, falling more than a full yen from Tuesday's high of 105.915. Strong resistance can be seen at 110.40 (Higher BB), an upside break can trigger rise towards 111.00 (Psychological level).On the downside, immediate support is seen at 110.16 (5 DMA), a break below could take the pair towards 109.35 (11 DMA). 

Equities Recap

European shares ended at a 14-month low on Wednesday after surrendering initial gains made on the Bank of England’s stimulus measures, while weakness in markets across the Atlantic also drove losses.

UK's benchmark FTSE 100 closed down by 1.40 percent, Germany's Dax ended down by -0.35 percent, France’s CAC finished the day down by 0.57 percent.

Wall Street stocks plunged on Wednesday, with the Dow   confirming a bear market for the first time since the financial crisis after the World Health Organization called the coronavirus outbreak a pandemic.

Dow Jones closed down by 5.86 percent, S&P 500 ended down by 4.89 percent, Nasdaq finished up by 4.70 percent.

Treasuries Recap

U.S. Treasuries rebounded on Wednesday as stocks dropped over uncertainty on how the White House plans to combat the impact of the coronavirus outbreak on the economy.
The 10-year note yield was last at 0.711%, down from 0.752% at Tuesday’s close.

Commodities Recap

Gold rose 1% on Wednesday, regaining some ground after the previous day's near 2% slide, as fears over the economic toll of the coronavirus outweighed an uptick in equity markets following an interest rate cut from the Bank of England.    

Spot gold  was up 1% at $1,664.81 per ounce by 1244 GMT, while U.S. gold futures  gained 0.4% to $1,666.90.

Oil prices fell on Wednesday after Saudi Arabia and the United Arab Emirates announced plans to boost production capacity and OPEC and the U.S. Energy Information Administration (EIA) slashed oil demand forecasts because of the coronavirus outbreak.

Brent crude was down $1.01, or 2.7%, at $36.21 per barrel by 12:12 ET (1712 GMT), while U.S. West Texas Intermediate (WTI) crude was off $1.05 or 3% at $33.31‮‮.