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OVERNIGHT MARKET SNAPSHOT FOR MONDAY 8/06/20
- SPI200 (Jun) overnight futures up 103 pts to 6099
- SP500 up 81.58 pts to 3193.93
- NASDAQ up 198.27 pts to 9814.08
- Dow Jones up 829.16 pts to 27,110.98
- FTSE100 up 142.86 pts to 6484.30
- DAX30 up 417.12 pts to 12847.68
- GOLD futures (Aug Contract) down $44.40 to $1683 an ounce
- COPPER futures (Comex July) up $0.052 to $2.542 a pound
- OIL futures US Session (Nymex July) up $2.14 to $39.55 a barrel
- CRB Index up 3.23 pts to 138.98
- AUDUSD trading at 0.6969
- EURUSD trading at 1.1292
- GBPUSD trading at 1.2668
- USDJPY trading at 109.5900
- USD Index US Session (ICE June) up 0.281 to 96.938
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The US ended the week with a very strong session after US non-farm employment change came out unexpectedly better than analysts predicted. Bulls ramped prices higher right from the open after data showed that somehow the economy gained jobs rather than lost them as everyone predicted. The unemployment rate was expected to push up to 19.4% from 14.7% but instead dropped to 13.3%. The reaction was swift as the bull run continues with many seeing the economy now on the mend and the worst is over. Safe haven assets were hit hard as traders went ‘all in’ on share indexes. US Bonds continued the selloff which now seems justified as the employment data was a massive surprise and may point to a faster recovery than traders had expected. The DOW closed up 3.15% while the broader SP500 was up 2.62% and the Nasdaq ended up 2.06% for the session. In Europe, major Indexes ramped higher once the data came out at 10:30pm and we expect to see further gains in Europe as many expect to see a lift in business activity. Europe has now made back around two thirds of the losses due to the coronavirus selloff.
The USD Index moved up after some of the recent sellers took a breather and locked away some gains. The Dollar remains in a downtrend and may resume although bulls may turn the tide if they can push price up through 97.60. The EURUSD came under pressure from the start of the European session and was hit lower after the data release and the USD rally. Stimulus may still continue to support price as, like the dollar, the trend is still in tact. If price can hold a higher level above 1.1250 even as buyers lock in gains and some heat comes out of the action, then we may see a test towards the highs. The GBPUSD brushed aside the USD strength and pushed up through resistance at 1.2650. The move up is stretched on the longer term timeframes so we may see some gains locked away soon to trigger a pullback. The AUDUSD was caught in two minds as price reacted lower on the dollar strength but buyers continued into the action as share markets surged. Expect to see the aussie lift to test 0.7050 in the near term. The USDJPY spiked hard directly after the data release as the USD rallied and the safe haven YEN was hit. Although price action is stretched, expect that a push to 111.500 highs is on the cards.
SPOT GOLD was hit hard on the employment release as any possibility of a safe haven trade was thrown out the window. Price fell like a stone to test down to 1670 where it bounced. Buyers may continue to come under pressure as share Indexes have opened stronger today and are set to continue the strength from Friday. If sellers start to jump back in then expect another push below 1670. Crude Oil has continued on today from where it ended Saturday as bulls take charge. Price ramped higher on a spike in expectations for increased demand and we expect the party to continue in the near term. Copper is starting to get dizzy at current levels as bulls have spiked price higher without really taking a break. Prices have been strong on expectations for an increase in demand and will more than likely continue although we are now at similar levels as we were prior to the selloff.
Cryptocurrencies spiked lower over the weekend but then rallied back to make back the losses to trade at similar levels as Friday. Bitcoin is trading at $9760.2 up 1.11%, Ethereum is at $243.21 up 0.56% and Ripple is at $0.20344 up 0.02%.
The ASX200 got off to a slow start Friday but then managed to rally into the close to end the week on a positive note. The index ended up 6.9 points to 5998.7 with Financials and the Energy leading the way while Utilities and Telecom Services dragged their feet. Rising stocks outnumbered declining ones by 668 to 535 and 368 ended unchanged.
The ASX200 is expected to open up strong on Tuesday (ASX closed for public holiday), depending on what transpires in the US tonight, after a strong finish to the week thanks to a stronger than expected US employment data release.
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ECONOMIC DATA OUT TODAY (AEDT)
JPY Current Account and Final GDP 9:50am
EUR German Industrial Production 4pm
EUR ECB President Lagarde Speaks 11:45pm
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SPI200 INTRADAY LEVELS TO WATCH
