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OVERNIGHT MARKET SNAPSHOT FOR THURSDAY 25/06/20 (as at 7:15am AEST)
- SPI200 (Sept) overnight futures down 92 pts to 5837
- SP500 down 80.96 pts to 3050.33
- NASDAQ down 222.20 pts to 9909.17
- Dow Jones down 710.16 pts to 25,445.94
- FTSE100 down 196.43 pts to 6123.69
- DAX30 down 429.82 pts to 12,093.94
- GOLD futures (Aug Contract) down $10.10 to $1771.90 an ounce
- COPPER futures (Comex Sept) down $0.015 to $2.643 a pound
- OIL futures US Session (Nymex July) down $2.30 to $38.07 a barrel
- CRB Index down 3.35 pts to 135.24
- AUDUSD trading at 0.6872
- EURUSD trading at 1.1256
- GBPUSD trading at 1.2424
- USDJPY trading at 107.0500
- USD Index US Session (ICE Sept) up 0.590 to 97.198
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US major indexes came under fire overnight as some heat finally came out of the overall market. The risk off tone was generally triggered by continued concern over the increasing number of virus cases as countries come out of lockdown. Many US states are seeing a rise in the number of infections while news that EU countries are prepared to stop entry for Americans raised concern for fresh restrictions. The move lower started in the European session as traders reacted to news on tariff talk. The US is weighing new tariffs on a range of EU products to the value of $3.1 Billion. The breakdown in relations comes at a time when markets are getting extended and do not need much of a reason to lock in some gains which may start a cascade of selling as the fundamental picture starts to soak in. The DOW closed down 2.72% while the broader SP500 was also down 2.59% and the Nasdaq ended down 2.19% for the session. In Europe, major Indexes plunged after the open to start the risk off tone in the overnight session. Concern over the spike in new virus cases along with an IMF warning had investors on the back foot. According to the International Monetary Fund, the coronavirus pandemic has caused wider and deeper damage to economic activity than first thought prompting 2020 global output forecasts to be slashed along with 2021 targets.
The USD Index rallied as traders dived back into the currency as a safe haven hedge. The dollar pushed up off support and looks set to test up to recent highs. The move in the dollar with the risk off tone of the session has triggered the unwinding of many linked markets which may continue if the share market sellers start to take control. The EURUSD moved lower off highs to fall around 60 pips. If the dollar continues to rally we will see the Euro test down to the 1.1180 zone. GBPUSD sellers stepped into the action to push price lower in line with the Dollar rally. If the Pound can start to hold a minor higher level then we expect to see some action higher but this will depend on USD sentiment. The AUDUSD took a hit as expected to squeeze out some buyers from the run up. Price is technically still holding longer term highs but another push lower could easily trigger a bigger wave of sellers into action. The USDJPY spiked on the dollar buying as the pair traded back up to previous highs around 107.210 which we expect to get tested today.
SPOT GOLD saw some profit taking on the move higher into the USD. Price did move lower but the trend is still up so it will be interesting to see what happens with further weakness into the USD. Aussie gold did well to end the session higher which should provide some support for Aussie gold miners. Crude Oil followed on from the previous sessions weakness as sellers moved price lower with buyers unwinding long positions. Price has made a key failure pattern up at $40 so watch for a major lower higher to confirm the setup and trigger a bigger selloff into the commodity if shares go into meltdown mode. Copper was very choppy as price moved lower with the dollar but then spiked to clean out some sellers before moving lower again into the US close. There seems to be some buyers intent on holding price up but a break below 2.6250 will bring in the selling pressure to overwhelm them.
Cryptocurrencies were weaker across the board as they followed the risk off tone into shares. Bitcoin is currently trading at $9307.4 down 3.45% while Ethereum is at $235.17 down 3.49% and Ripple is trading at $0.18346 down 3.10%.
The ASX200 saw a choppy session yesterday as price went from positive territory to negative and then back again to end up 11.3 points at the close to 5964.7. The Gold sector well outperformed the market and was followed by Utilities while the Energy sector was under pressure all session into the close. Rising stocks outnumbered declining ones by 678 to 578 and 345 ended unchanged.
The ASX200 is expected to open down 90 points after global markets went risk off overnight.
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ECONOMIC DATA OUT TODAY (AEST)
CNY China Bank Holiday All Day
EUR German Consumer Climate 4pm
EUR ECB Monetary Policy Meeting Accounts 9:30pm
USD Durable Goods Data, GDP and Unemployment Claims 10:30pm
USD Goods Trade Balance and Prelim Wholesale Inventories 10:30pm
GBP MPC Member Haldane Speaks 3am
USD Bank Stress Test Results 6:30am
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SPI200 INTRADAY LEVELS TO WATCH
