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OVERNIGHT MARKET SNAPSHOT FOR TUESDAY 10/06/20 (as at 7:15am AEST)
- SPI200 (Jun) overnight futures down 87 pts to 6097
- SP500 down 25.21 pts to 3207.18
- NASDAQ up 29.01 pts to 9953.75
- Dow Jones down 300.14 pts to 27,272.30
- FTSE100 down 136.87 pts to 6335.72
- DAX30 down 201.60 pts to 12617.99
- GOLD futures (Aug Contract) up $14.60 to $1719.70 an ounce
- COPPER futures (Comex July) up $0.034 to $2.599 a pound
- OIL futures US Session (Nymex July) up $0.17 to $38.36 a barrel
- CRB Index up 0.95 pts to 138.45
- AUDUSD trading at 0.6957
- EURUSD trading at 1.1338
- GBPUSD trading at 1.2729
- USDJPY trading at 107.7500
- USD Index US Session (ICE June) down 0.223 to 96.385
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The US saw some profit taking into the major indexes after the recent strength ahead of the FOMC meeting later tonight. The move lower started in the European session but did not gain as much traction as many bears expected. Traders were happy to take some risk off the table although the NASDAQ extended into new all time highs to defy the broader market weakness on the open. Traders will be focused on the Feds statement and its first economic projections since December. They also will be focused on the Feds gauging of the economic cost of the pandemic. One potential emerging risk to the markets is the slip in the polls for Trump as he losses ground to Biden who is seen by Wall St as not haven as market friendly policies. The DOW closed down 1.09% while the broader SP500 was down 0.78% and the Nasdaq ended up 0.29% for the session. In Europe, major Indexes lost some more ground as recent gains were locked away. Banking and Oil stocks led the move lower as investors were wary ahead of the FOMC statement.
The USD Index initially moved up at the start of the European session but then was hit lower to take out lows and continue the push into support. The dollar confirms that the stock market move was just some profit taking rather than the start of a big selloff. The USD is still under pressure and holding lower levels so watching price action around 96.050 on the dollar index to see if it shows signs of finding support. The EURUSD initially flushed lower to clear out some late buyers before price kicked higher to resume the trend up. We still expect to see a run up through 1.1400. The GBPUSD again retested the 1.2650 zone before moving up to end the US session on the highs. If price can hold a higher low then expect that bulls will ramp up through the 1.2750 zone. The AUDUSD saw a sharp move lower off the 0.7000 level as buyers were quick to lock in some gains once Indexes started to head south at the start of the European session. If price can hold above the 0.6900 zone then expect a spike back above the 0.7000 area. There is a lot a ‘buying’ fuel built up for a squeeze lower but we do not expect a major selloff just yet. The USDJPY continued the move lower on dollar weakness and YEN safe haven buying. The action is held down at 108.245 so as long as this level holds, the pressure lower will continue.
SPOT GOLD found some safe haven buying as the indexes went risk off for the session. Price was also helped by the move lower in the USD which did not show any safe haven trading. Gold may remain range bound for now between support at 1665 and resistance up at 1750. The longer it consolidates between these levels, the more we will expect price to break up through the highs…but that will depend on what happens with the share market. Crude Oil initially moved lower at the start of the European session but it was just a flush of buyers before the rally to make back the lost ground. The move does not support the bear case at this stage and we expect to see the higher low hold and price to target back above 40 in the near term. Copper did not reflect any concerns into the share market as price continued higher. Price is pushing up into resistance at 2.6250 which is where it was trading prior to the selloff. We still expect to see some profit taking from buyers and will be watching the price action closely to see whether a sharp move lower is on the cards or not.
Cryptocurrencies saw another choppy range bound session after a spike lower prior to the Asian session open. Bitcoin is trading at $9743.2 up 0.47% while Ethereum is at $243.41 upo 0.48% and Ripple is at $0.20123 down 0.43%.
The ASX200 opened strong yesterday as expected, but then was caught in a range as buyers looked to lock in some gains. The Index ended the session up 146.2 points to 6144.9. The Financial and Energy sectors led the charge both being up over 4% while Gold was hit and ended down 4.01%. Rising stocks outnumbered declining ones by 822 to 496 and 347 ended unchanged.
The ASX200 is expected to open down 90 points after the SPI200 traded lower along with the overnight markets.
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ECONOMIC DATA OUT TODAY (AEDT)
JPY PPI 9:50am
AUD Westpac Consumer Sentiment 10:30am
CNY CPI and PPI Data 11:30am
USD CPI Data 10:30pm
USD Crude Oil Inventories 12:30am
USD FOMC Statement and Fed Funds Rate 4am
USD FOMC Press Conference 4:30am
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SPI200 INTRADAY LEVELS TO WATCH
