OVERNIGHT MARKET SNAPSHOT FOR WEDNESDAY 18/03/20 (as at 7:30am AEDT)
- SPI200 (Mar) overnight futures down 7 pts to 5279
- SP500 up 143.06 pts to 2529.19
- NASDAQ up 430.19 pts to 7334.78
- Dow Jones up 1048.86 pts to 21,237.88
- FTSE100 up 143.82 pts to 5294.90
- DAX30 up 196.85 pts to 8939.10
- GOLD futures (April Contract) up $43.10 to $1529.60 an ounce
- COPPER futures (Comex May) down $0.079 to $2.313 a pound
- OIL futures US Session (Nymex Apr) down $1.82 to $26.88 a barrel
- CRB Index down 2.43 pts to 130.29
- AUDUSD trading at 0.5996
- EURUSD trading at 1.1001
- GBPUSD trading at 1.2068
- USDJPY trading at 107.6200
- USD Index US Session (ICE June) up 1.668 to 99.820
Another big swing as US Indexes try to find a low and start to bring some confidence back into the action although buyers remain tentative. The major Indexes could only make back half of the previous sessions losses as buyers went bargain hunting. Global stimulus increases with France and the World Bank adding to funds available to support business. The US is preparing to add further stimulus to inject over $1 Trillion into the economy. The aim is to free up liquidity for small business and help individuals who may come under stress via direct checks. The US and worldwide travel industry has come under severe stress along with Hotels which now expect to see jobs cuts begin so are meeting with governments for bailouts. Expect to see further industries come under pressure as lockdowns continue to cut corporate incomes which will flow over into the overall economy. The DOW bounced to end up 5.20% while the broader SP500 was up 6.00% and the Nasdaq also ended up 6.23% for the session. In Europe, stock Indexes also made back some of the losses on bargain hunting rather than any change in sentiment due to stimulus packages. Spain helped to support the European markets by announcing a strong stimulus plan. Traders are still dealing with the worldwide spread of the virus as many believe that there is more to come making the economic impact still hard to assess. Job cuts are only just starting so there will be more time before the effects start to show in data and markets can start to look forward into the future.
The USD Index surged as companies and investors sought out the most liquid currency on concerns about economic shutdowns. Central Banks around the world have taken measures to free up funding for financial Institutions triggering the strength in the dollar and further pressure on the dollar crosses. The EURUSD was belted once the USD got some traction to spike higher. The next stop will be around 1.0890 to see if the sellers will take a breather. As long as the strains in the swap market; hence company funding; continue, expect the dollar to continue to gain and pressure the Euro. The GBPUSD was also hit hard down into potential support around 1.1995 but it is too early to gauge whether the level will hold. The commodity linked AUDUSD fell apart to push below prices from the GFC lows and crack 0.6000. If buyers do not step up to the plate for support, we may see a further push to 0.5000. The USDJPY went higher once the dollar rally got underway although the rally was contained to some extent but the YEN buying.
SPOT GOLD was initially hit down to recent lows below 1500 only to put in a stellar bounce that will get the bulls excited. Price is still technically in a downtrend but the held a minor higher low off a key zone around 1450. We may see some further buying but we do not see a major rally getting underway just yet. Crude Oil again come under pressure to continue its slid lower. Price is now at the lower level of key weekly support so bulls will need to make a stand soon to stem the tide of selling pressure. We expect that the only way to find support is some news on the Saudi/Russia front. Copper continued with the momentum lower as any increase in demand to support price is off the cards now for a while. The next level down is around 2.0890.
Cryptocurrencies fought back to make back some of the losses from the recent drop and followed the share market higher showing that buyers are being driven by sentiment. Bitcoin is currently trading at $5297.3 up 6.42% while Ethereum is at $117.20 up 5.41% and Ripple is trading at $0.14704 up 5.14%.
The ASX200 had a better day for the bulls as the Index opened flat to shrug off the overnight action and then rallied into the close. In the end the ASX200 was up 291.4 points to 5293.4 with the Gold sector surging higher being followed by Metals and Mining stocks the Financials. All in all it was some relief to the recent few days as all sectors ended in the green. Rising stocks outnumbered declining ones by 642 to 580 and 262 ended unchanged.
The ASX200 is expected to open flat as the SPI200 closed the session where it started.
ECONOMIC DATA OUT TODAY (AEDT)
AUD MI Leading Index 10:30am
JPY Trade Balance 10:50am
EUR Final CPI Data and Trade Balance 9pm
CAD CPI Data 11:30pm
USD Building Permits and Housing Starts 11:30pm
USD Crude Oil Inventories 1:30am
SPI200 INTRADAY LEVELS TO WATCH