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OVERNIGHT MARKET SNAPSHOT FOR WEDNESDAY 22/01/20 8:30am AEDT
- SPI200 (Mar) overnight futures down 2 pts to 7006
- SP500 down 8.83 pts to 3320.79
- NASDAQ down 18.14 pts to 9370.81
- Dow Jones down 152.06 pts to 29,196.04
- FTSE100 down 40.74 pts to 7610.70
- DAX30 up 6.93 pts to 13,555.87
- GOLD futures (Feb Contract) down $1.60 to $1558.70 an ounce
- COPPER futures (Comex Mar) down $0.052 to $2.793 a pound
- OIL futures US Session (Nymex Feb) down $0.20 to $58.34 a barrel
- CRB Index down 1.32 pts to 181.56
- AUDUSD trading at 0.6846
- EURUSD trading at 1.1083
- GBPUSD trading at 1.3042
- USDJPY trading at 109.8300
- USD Index US Session (ICE March) up 0.011 to 97.370
US Indexes backed away from all time highs as traders were spooked by the virus outbreak in China as hundreds of millions travel for the Chinese Lunar New Year holidays. The US confirmed its first case of the coronavirus which has now killed six people in China. The news hit travel related stocks the hardest as people will be very reluctant to fly in a contained cabin if the problem increases. Investors will be drawing comparisons to the 2003 SARS outbreak in order to assess its potential economic impact. Click here to read further about the potential impact on markets. The DOW closed down 0.52% while the broader SP500 was down 0.27% and the Nasdaq closed down 0.19% for the session. In Europe, key indexes were lower on the virus concern with the FTSE getting hit hard on the open. The DAX index was also hit hard although the bulls managed to make back all the losses into the close. Support for the DAX came from data showing that business sentiment has increased on optimism that the economy is turning and an industrial rebound is right around the corner.
The USD moved higher for the session as risk assets lost ground and safe havens gained. The Dollar was initially hit hard from the start of the European session but gained back the lost ground through US trade and continued to push higher after the close. Support for the Dollar came thanks to the IMF cutting growth forecasts for 2020. The EURO traded inversely to the USD with gains made in the European session given back through to the US close. If the 1.1075 zone can not hold for the Euro, price will attack lower levels around 1.0990. The GBP gained on the back of employment and earnings data. The move up was supported by the weakness into the USD but unlike the Euro, the Pound managed to hold onto the gains as the dollar rallied. The AUD traded into support as the USD lifted into the close of teh US session with price action pretty much doing the same as the Euro. We expect to see the bears move price lower into support around 0.6838 to test the commitment of the bulls around these lows. The USDJPY was initially supported by the USD buying but then gave way to move lower as safe haven YEN buyers kicked into action.
Gold initially pushed higher to break above $1562 during the Asian session on the virus news, but then submitted to selling pressure which spiked the commodity close to $20 lower. Price did manage to bounce but the move is not a great sign for gold bulls as it looked like a trap on the break higher through $1562 followed by the squeeze lower. Crude Oil continued to push lower through the European session thanks to the dollar weakness but turned sharply off support on the dollar recovery. So far price is behaving and laying the foundations for a move up but only time will tell. Copper finally broke down through support levels from the previous few sessions, and did it with style. Price smashed through support to trigger stops and could not make back the lost ground.
Cryptocurrencies were generally trading in a tight range only to see a late spike lower which was quickly recovered as the bears looked to trigger some stops. Bitcoin is currently trading at $8702.9 up 0.35% while Ethereum is at $168.13 up 0.51% and Ripple is at $0.23765 up 1.55%.
The ASX200 spent the day in negative territory yesterday after US overnight markets came under pressure thanks to the China virus concerns. The index was down around 30 points for most of the session managing to rally slightly into the close and making up 10 points in the match alone. In the end the ASX200 ended down only 13.2 points to 7066.3 with the Gold and Energy sectors being standout performers while IT ended the weakest. Falling stocks outnumbered advancing ones by 653 to 527 and 371 ended unchanged.
The ASX200 is expected to open flat as the SPI200 had a choppy night but managed to hold above the day session lows.
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ECONOMIC DATA OUT TODAY (AEDT)
AUD Consumer Sentiment 10:30am
ALL WEF Annual Meetings Day 2
CAD CPI Data 12:30am
CAD Overnight Rate, BOC Monetary Policy and Rate Statement 2am
USD Existing Home Sales 2am
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SPI200 INTRADAY LEVELS TO WATCH
