Market Roundup
- Gold steady on risk-off sentiment
- Oil prices decline as U.S. coronavirus cases climb
Economic Data Ahead
- (0430 ET/0830 GMT) UK Consumer Inflation Expectations
- (0500 ET/0900 GMT) EZ Industrial Production w.d.a. (YoY)(Apr)
- (0500 ET/0900 GMT) EZ Industrial Production s.a. (MoM)(Apr)
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index eased after a Reuters analysis showed new infections in the United States rose slightly after five weeks of declines. Investors were worried about new coronavirus infections as the world gradually reopened following shutdowns aimed at curbing the spread of the pandemic. The greenback against a basket of currencies traded 0.1 percent down at 96.73, having touched a low of 95.72 on Wednesday, its lowest since March 10.
EUR/USD: The euro steadied after tumbling 0.6 percent in the prior session, as Europe faced tough negotiations next week on its recovery fund plan. The European Central Bank’s chief economist Philip Lane stated that the ECB will do anything possible to ensure that the current crisis is not made worse by a credit crunch. The European currency traded 0.1 percent down at 1.1306, having touched a high of 1.1422 on Wednesday, its highest since March 10. Investors’ attention will remain on a series of data from Eurozone economies and EZ industrial production, ahead of U.S. import price index, export price index, Michigan prelim consumer sentiment index and Fed officials' speeches. Immediate resistance is located at 1.1363, a break above targets 1.1420. On the downside, support is seen at 1.1256 (10-DMA), a break below could drag it below 1.1234.
USD/JPY: The dollar rebounded, halting a 4-day losing streak after data showed U.S. jobless claims declined last week, but continuing claims were at an astoundingly high 20.9 million. On Thursday, the pair fell to a 1-month low amid doubts over the economy stemmed in part from the U.S. Federal Reserve’s dire economic assessment as well as fears over new coronavirus infections. The major was trading 0.3 percent up at 107.16, having hit a low of 106.57 the day before, its lowest since May 11. Investors’ will continue to track the broad-based market sentiment, ahead of U.S. import price index, export price index, Michigan prelim consumer sentiment index and Fed officials' speeches. Immediate resistance is located at 107.50, a break above targets 107.94. On the downside, support is seen at 106.35, a break below could take it near at 106.03.
GBP/USD: Sterling declined to a 1-week low, weighed down by Brexit-related concerns and speculation about negative rates. Britain has until the end of the month to request an extension to the transition period. On Wednesday, the EU's Brexit negotiator, Michel Barnier, urged London to adjust its demands, saying Britain was seeking a trading relationship with the EU that was too close to that of a member. The major traded 0.2 percent down at 1.2575, having hit a high of 1.2813 on Wednesday, it’s highest since March 12. Investors’ attention will remain on the geopolitical developments ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2633, a break above could take it near 1.2675. On the downside, support is seen at 1.2518, a break below targets 1.2485. Against the euro, the pound was trading 0.2 percent down at 89.82 pence, having hit a low of 90.14 on Thursday, it’s highest since June 1.
AUDUSD: The Australian dollar slumped to a 10-day low, as the tensions between the United States and China showed limited signs of abating. On Thursday, the major fell over 2 percent, recording the biggest daily fall since the market turmoil of March. The major trades 0.05 percent down at 0.6850, having hit a low of 0.6799 earlier, it’s lowest since June 2. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.6902 (10-DMA), a break above could take it near 0.6960 (5-DMA). On the downside, support is seen at 0.6774, a break below targets 0.6719 (21-DMA).
Equities Recap
Asian shares slumped amid concerns that a resurgence of coronavirus infections could stunt the pace of recovery in economies reopening from lockdowns.
MSCI's broadest index of Asia-Pacific shares outside Japan tumbled 1.3 percent.
Tokyo's Nikkei fell 0.8 percent to 22,305.48 points, Australia's S&P/ASX 200 index declined 1.9 percent to 5,847.80 points. South Korea's KOSPI slumped 1.8 percent to 2,136.65 points.
Shanghai composite index eased 0.05 percent to 2,919.57 points, while CSI 300 index traded 0.05 percent down at 3,993.77 points.
Hong Kong’s Hang Seng traded 1.3 percent lower at 24,162.72 points. Taiwan shares shed 0.9 percent to 11,429.94 points.
Commodities Recap
Crude oil prices declined, extending previous session heavy losses, fuelled by renewed concerns about easing demand as new cases of coronavirus tick up globally, while crude inventories hit a record in the United States. International benchmark Brent crude was trading 1.5 percent lower at $37.73 per barrel by 0539 GMT, having hit a low of $36.98 earlier, its lowest since May 29. U.S. West Texas Intermediate was trading 1.8 percent down at $35.44 a barrel, after falling as low as $34.53 earlier, its lowest since June 1.
Gold prices steadied amid gloomy economic projections and renewed fears over a second wave in COVID-19 infections. Spot gold traded 0.1 percent up at $1,728.82 per ounce by 0543 GMT, having touched a high of $1,744.91 on Thursday, its highest since June 2. U.S. gold futures fell 0.4 percent to $1,733.30.
Treasuries Recap
The 10-year U.S. Treasury yield edged up slightly to 0.6853 percent.
