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OVERNIGHT MARKET SNAPSHOT FOR FRIDAY 22/05/20 (as at 7:15am AEST)
- SPI200 (Jun) overnight futures down 4 pts to 5540
- SP500 down 23.10 pts to 2948.51
- NASDAQ down 90.89 pts to 9284.88
- Dow Jones down 101.78 pts to 24,474.12
- FTSE100 down 51.91 pts to 6015.25
- DAX30 down 157.78 pts to 11,065.93
- GOLD futures (June Contract) down $25.40 to $1726.70 an ounce
- COPPER futures (Comex July) down $0.036 to $2.424 a pound
- OIL futures US Session (Nymex July) up $0.42 to $33.91 a barrel
- CRB Index down 0.39 pts to 130.52
- AUDUSD trading at 0.6564
- EURUSD trading at 1.0948
- GBPUSD trading at 1.2227
- USDJPY trading at 107.6500
- USD Index US Session (ICE June) up 0.305 to 99.440
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US Indexes edged lower as trade tensions start to weigh on sentiment and investors lock in some gains. A lot of money has plowed into Tech companies as markets pushed up off lows from the selloff. If investors start to get jittery and book gains, then it will be a decent drag on the DOW which may trigger further selling pressure across the board. It is still hard to see a big selloff until more is known about the number of coronavirus cases out of lockdown. Of course, trade issues may become a trigger in an already beaten down economy. Trump is out threatening China on Hong Kong issues so it seems that China is going to be used as a punching bag for upcoming elections. The one positive from overnight, if it can be called that, is that US unemployment claims were higher which sets up an interesting payroll number at the start of next month and in turn will increase the case for more stimulus for the share market junkies. The DOW moved back down 0.41% while the broader SP500 was down 0.78% and the Nasdaq ended down 0.97% for the session. In Europe, Indexes were also lower as traders were happy to lock in some gains up at resistance levels. Buyers may be waiting for another trigger to move higher which may come in the form of further stimulus if jobs continue to come under pressure. It is yet to be seen if there is going to be much substance behind trade tensions but it will cap the action in the near term. Banks, Oil and Gas and Tech companies were the biggest drag on indexes as risk eased out of the action.
The USD Index moved up as buyers start to build a base off 99.100 on the dollar index. Price may be simply setting up for a short squeeze but it will need to get through 99.61 first. Longer term the dollar is stuck in a narrowing range so a move up from here is not necessarily pointing to a major selloff in shares. The EURUSD rallied during the European session but then gave up the gains as the US opened and the USD rallied. Like the USD, we expect to see some profit taking in the Euro up at highs to pressure price lower. The GBPUSD is looking weak although price is hovering around longer term support. A break below 1.2185 will trigger more sellers into action for continuation lower although at move up through 1.2250 will confirm support. The AUDUSD is contracting off the highs although buyers continue to step in at higher prices around 0.6552. If the 0.6552 zone can hold then expect another run up which would suggest share markets are finding further strength. The USDJPY edged lower as the YEN found some safe haven buying to offset the dollar strength and pressure buyers.
SPOT GOLD moved lower on a bout of profit taking up at the highs and as the rally in the USD pressured price. Again, gold did not perform as a safe haven on concerns for a selloff as traders prefer the USD instead. It may be a short term pullback as there are many factors that are bullish for gold longer term. Crude Oil was buoyed through Asian and European trade after the rollover went smoothly and fears of another price collapse eased. Price did see some profit taking once the US opened but expect support to continue for the commodity as countries re-open and start to soak up supply. Copper saw some profit taking as expected after the previous ramp higher but price is now retesting previous resistance which may now become support. If we see buyers start to step in then expect another run up to the highs.
Cryptocurrencies moved lower overnight with Bitcoin and Ethereum leading the way. Bitcoin is currently trading at $9059.9 down 5.84% while Ethereum is at $199.30 down 5.48% and Ripple is at $0.9997 down 0.02%.
The ASX200 opened stronger as expected yesterday but then the bears stepped into to pressure prices lower. Buyers could not hold above the 5600 level and the Index ended down 22.6 points to 5550.4. It was a mixed bag across the sectors with Energy ending up 1.33% while Utilities were the worst performer ending down 1.84%. Falling stocks outnumbered advancing ones by 600 to 588 and 340 ended unchanged.
The ASX200 is expected to open down 5 points as the SPI200 was range bound for the overnight session.
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ECONOMIC DATA OUT TODAY (AEDT)
JPY Monetary Policy Statement Tentative
JPY BOJ Policy Rate Tentative
GBP Retail Sales 4pm
JPY BOJ Press Conference Tentative
EUR ECB Monetary Policy Meeting Accounts 9:30pm
CAD Retail Sales Data 10:30pm
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SPI200 INTRADAY LEVELS TO WATCH
