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OVERNIGHT MARKET SNAPSHOT FOR THURSDAY 6/08/20 (as at 7:15am AEST)
- SPI200 (Sept) overnight futures up 27 pts to 5989
- SP500 up 21.26 pts to 3327.77
- NASDAQ up 57.23 pts to 10,998.40
- Dow Jones up 373.05 pts to 27,201.52
- FTSE100 up 68.72 pts to 6104.72
- DAX30 up 59.38 pts to 12,660.25
- GOLD futures US session (Aug) up $33.20 to $2034.40 an ounce
- COPPER futures (Comex Sep) up $0.0228 to $2.9173 a pound
- OIL futures US Session (Nymex Sep) up $0.50 to $42.20 a barrel
- CRB Index up 0.79 pts to 148.71
- AUDUSD trading at 0.7192
- EURUSD trading at 1.1865
- GBPUSD trading at 1.3122
- USDJPY trading at 105.6000
- USD Index US Session (ICE Sept) down 0.558 to 92.820
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US indexes had another positive session on the back of earnings and stimulus hopes as prices were ramped higher from he open. Bulls continue to brush aside any negative news after data showed employers hired far fewer workers than expected in July as companies exhausted loans to pay wages. Even as the recovery shows signs of faltering and virus cases continue to flare up across the country, traders are happy to be risk on until something changes with regards to stimulus as the markets ‘backstop’. The Feds focus has always been on employment and we will see further details on the employment rate and news jobs out tonight with Non-Farm Payroll data released. Good news that supported the bull case was that data showed growth in the services sector, which accounts for around two thirds of US economic activity. US Bond prices fell on the back of the data release which may be due to traders locking in some gains ahead of the key employment data as the move lower was already underway prior to the release. The DOW closed up 1.39% while the broader SP500 was up 0.64% and the Nasdaq ended up 0.52% for the session. In Europe, major Indexes ended the session with gains as commodity prices rallied and earnings reports come out above expectations.
No-one is talking about the US-China trade deal which is now under pressure with the increased tensions between the two nations. Data shows that the U.S.-China trade deficit widened 5% to $28.4 billion in June from the month prior which falls well short of Beijings commitments to buy US goods. It may be due to the fact the US exports overall have surged on the back of the weaker USD.
The USD Index continued to move lower on expectations for further stimulus which is expected to be released by the end of the week with the timing, with Trumps news headline track record, more than likely to coincide with the employment data Friday night. Price did react again off the 92.50 zone but recent momentum suggests further downside in the near term. The EURUSD ramped back up to highs around 1.1900 before seeing some sellers jump in and buyers lock in some gains. If longer term momentum fades up at current levels then expect to see a decent squeeze lower on the cards. The GBPUSD also continued to benefit from the weaker USD but did see some sellers also up at previous highs around 1.3160. Like other USD denominated currencies, any significant move down will depend on the US Dollar. The AUDUSD also moved higher but the rallied stalled up at highs around 0.7235 once the USD rallied at the start of the US session on the jobs data. If price can hold current levels then expect buyers to be seduced back into the action for a push through highs. The USDJPY edged its way lower looking unconvinced in the USD move down. We may see another squeeze higher if price breaks up through 105.866.
SPOT GOLD continued the charge higher as the USD fell. Prices have now cleared out recent all time highs and look set to extend further if price can consolidate above 2027. Crude Oil found buyer support both from the weakness in the USD and weaker than expected inventories data. Price may be set to have another run higher if it can hold above 41.45 and the USD holds around its lows. Copper is starting to show more bullish signs as support levels continue to hold. Longer term buyers remain in the action as the weakness in the dollar supports price and share markets continue to gain on the negative economic backdrop.
Cryptocurrencies had a good session being supported by the fall in the USD. Bitcoin is trading at $11724.1 up 4.41% while Ethereum is at $400.58 up 2.23% and Ripple is at $0.30341 up 1.55%.
The ASX200 opened weak yesterday to flush out some buyers before price recovered some off the losses into the close. The Index ended down 36.3 points to 6001.3 to continue with the choppy action from the previous few days. Gold was the best performing sector for the day while Industrials and Telecom Services weighed the most on the action. Rising stocks outnumbered declining ones by 657 to 549 and 350 ended unchanged.
The ASX200 is expected to open up 30 points as the SPI200 follows the US higher on the back of stimulus hopes.
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ECONOMIC DATA OUT TODAY (AEST)
NZD Inflation Expectations 1pm
EUR German Factory Orders 4pm
GBP Official Bank Rate and BOE Monetary Policy Report 4pm
GBP Asset Purchase Facility and BOE Financial Stability Report 4pm
GBP BOE Gov Bailey Speaks 9:30pm
USD Unemployment Claims 10:30pm
USD FOMC Member Kaplan Speaks 12am
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SPI200 INTRADAY LEVELS TO WATCH
