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OVERNIGHT MARKET SNAPSHOT FOR WEDNESDAY 24/06/20 (as at 7:15am AEST)
- SPI200 (Sept) overnight futures up 9 pts to 5934
- SP500 up 13.43 pts to 3131.29
- NASDAQ up 74.89 pts to 10,131.37
- Dow Jones up 131.14 pts to 26,156.10
- FTSE100 up 75.50 pts to 6320.12
- DAX30 up 260.79 pts to 12,523.76
- GOLD futures (Aug Contract) up $17.30 to $1783.70 an ounce
- COPPER futures (Comex Sept) up $0.002 to $2.651 a pound
- OIL futures US Session (Nymex July) down $0.71 to $40.02 a barrel
- CRB Index down 0.46 pts to 138.59
- AUDUSD trading at 0.6927
- EURUSD trading at 1.1311
- GBPUSD trading at 1.2516
- USDJPY trading at 106.4900
- USD Index US Session (ICE Sept) down 0.340 to 96.645
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The US market continued its march higher to brush aside earlier weakness during Asian trade. Positive data out in Europe triggered the bulls back into action with the positive sentiment flowing over into the US session. Traders are solely focused on a swift economic recovery and continue to factor in a ‘return to the norm’. Earlier comments from US trade adviser Peter Navarro over the trade deal with China spooked the market. It was not long before the comments were retracted and Trump was on twitter saying things are still rosy. It goes to show how important the rally is to Trump and his team as they must be sitting watching the markets out of hours…strange focus for an administration. The re-assurance of the trade deal boosted longer term US bond yields on inflation expectations. German bond yields also moved higher to support the major Indexes. The DOW closed up 0.50% while the broader SP500 was also up 0.43% and the Nasdaq ended up 0.74% for the session. In Europe, major Indexes had a big night after Manufacturing data came in a lot better than expected to trigger the risk on sentiment. There seems to be a lot of cash in the system looking for a home and shares are the place now as prices continue to rise and brush aside negative fundamentals.
The USD Index continued lower with the selling done in the European session prior to the US open where buyers then lifted price off support around 96.40. The action looks set to continue down if price holds current levels to build another lower high. The EURUSD lifted up into resistance before sellers reacted to shove price lower in line with the action in the USD. Watching price up at 1.1340 to see if further weakness comes in to hold a lower high and put the squeeze on buyers….but this of course will depend on the USD. The GBPUSD eventually found strength to move up off minor resistance at 1.2440. Price has broken out of longer term contraction lower but we will need to see a key higher low holding before being convinced that the bulls are taking charge. The AUDUSD got back on track after the earlier news driven selloff. Price continued to find buyers on dollar weakness and share market strength. Interesting to see the move lower through US trade after a positive European session. This coincided with the DOW backing off earlier highs made on the open. The USDJPY took a beating as the USD moved lower. Price earlier spiked on the trade news to trap some buyers only to later start the march lower through European trade and squeeze out the buyers through key support at 106.650.
SPOT GOLD extended up through an important level into new highs. Price was supported by the weaker USD and we expect to see further buying as long as the dollar continues lower. The large amount of stimulus flowing into markets paints a weaker picture for economies making Gold attractive. If the dollar was too rally off lows, we expect that gold bulls will get squeezed out on a pullback. Crude Oil came under pressure and price struggled to end with gains as price backed away from highs during the US session. The action remains in an uptrend and the move may simply be a squeeze on late buyers to put them back on the sidelines. Copper was also hit off highs even as the USD fell which should have been supportive. Like Oil, the trend up is still intact as long as price can hold above the 2.6400 level.
Cryptocurrencies were contained after the recent rally and look to be trying to consolidate the highs. Bitcoin is currently trading at $9612.5 down 0.24% while Ethereum is at $243.10 down 0.64% and Ripple is at $0.18910 down 0.06%.
The ASX200 saw a massive spike lower in the space of a few minutes yesterday as the US government decided to mess with the market. Global indexes were hit hard after comments from US trade adviser Peter Navarro saying the ‘China trade deal is over’. Apparently is was not over and he later changed the comments after a ‘tap on the shoulder’ from Trump sending markets straight back to where they started. In the end the ASX200 ended up 9.9 points to 5954.4 with the Consumer Discretionary sector doing the best and Metals and Miners ending with gains while Gold and Energy ended in the red. Falling stocks outnumbered advancing ones by 627 to 608 and 352 ended unchanged.
The ASX200 is expected to open up 5/10 points as the SPI200 brushed aside the selloff during the day and pushed up to test the highs during US trade.
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ECONOMIC DATA OUT TODAY (AEDT)
NZD Official Cash Rate and RBNZ Rate Statement 12pm
EUR German Ifo Business Climate 6pm
USD Crude Oil Inventories 12:30am
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SPI200 INTRADAY LEVELS TO WATCH
