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OVERNIGHT MARKET SNAPSHOT FOR TUESDAY 7/07/20
- SPI200 (Sept) overnight futures up 31 pts to 6019
- SP500 up 49.71 pts to 3179.72
- NASDAQ up 226.02 pts to 10433.65
- Dow Jones up 459.67 pts to 26,287.03
- FTSE100 up 128.64 pts to 6285.94
- DAX30 up 205.27 pts to 12,733.45
- GOLD futures US session (Aug) up $4.00 to $1794.00 an ounce
- COPPER futures (Comex Sept) up $0.039 to $2.787 a pound
- OIL futures US Session (Nymex Aug) down $0.06 to $40.59 a barrel
- CRB Index up 0.30 pts to 140.90
- AUDUSD trading at 0.6977
- EURUSD trading at 1.1309
- GBPUSD trading at 1.2491
- USDJPY trading at 107.3700
- USD Index US Session (ICE Sept) down 0.566 to 96.735
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US indexes were ramped higher ahead of the Asian session and continued higher once China was up and running for trade. Buyers dived in as they bet on an improving Chinese economy and the future impact the strength will have on global growth. Prices on key US Indexes were relatively range bound during the session as the DOW futures had already set up for a strong open rallying around 500 points in the Asian session. News outlets were trying to pin the rally on stronger than expected services data out in the US which later supported the rally but buyers were already entrenched. The gains come despite a record surge of Covid-19 cases in the US across 16 states. Expect the bullish sentiment to continue to overshadow the increase in cases until we see a rise in the fatality numbers. Buyers were obviously not deterred although volumes on exchanges were lighter than the average for the last 20 trading days. The DOW closed up 1.78% while the broader SP500 was up 1.59% and the Nasdaq also ended up 2.21% for the session. In Europe, major Indexes gapped up on the open on the back of a strong Asian session although the intraday action generally trended lower. Buyers were supported by gains in the Hang Seng and the DOW through Asian trade and later by a rebound in Eurozone retail sales data. It was a risk on session across the board as trading exuberance in China thanks to cheap funding, improving economic data, and hopes for renewed stimulus efforts buoyed the action.
The USD Index was under pressure all session as global share markets surged…well accept for the ASX200. The risk on tone dented demand for safe havens and sellers continued to push the USD lower. Price is set to continue down to support on the dollar as price holds lower highs. The EURUSD had a good session thanks to the dollar as price pushed up into highs around 1.1350. We may see a reaction from sellers for a squeeze on buyers although the bulls are in control and looking set to hold a higher level for continuation up. The GBPUSD also moved higher although not with as much enthusiasm as the Euro. Price came under some selling pressure once the US was open for trade and the USD found some buyers to lift price off the lows. The Pound continues to be up against resistance around 1.2535. The AUDUSD continued to be lifted by the risk on tone into the share market. Price pushed up into resistance around 0.6975 and managed to hold the level into the US close. We may see some profits from buyers taken off the table into the RBA statement today although we do not expect any surprises on interest rates. The USDJPY was a choppy market over the full trading day as price ran up hard in Asian trade only to turn sharply lower to give up all the gains and more into the close of the US. Price was weighed down by the fall in the USD and found no love from YEN sellers to hold up the currency pair.
SPOT GOLD rallied on the back of the weaker USD as price action did its usual ‘flush and run’…meaning push through support to clean out some buyers before a run higher. Price is now stretched into previous highs around 1788 where we may see some recent gains locked away. Crude Oil swung between gains and losses but had a relatively uneventful session in the end. Price continued to hold higher lows on the expectation for a lift in demand but still struggled to break clearly above the 40 zone. Copper was a one way move as it looked like someone fell asleep on the ‘buy button’. Price rallied strong from the start of the day and never looked back. It may be a waste of time saying price is extended but we do expect to see some profit taking before a new leg higher.
Cryptocurrencies put in a solid session to rally along with the risk on sentiment to start the new week. Bitcoin is currently trading at $9276.8 up 2.78% while Ethereum is at $238.50 up 5.10% and Ripple is at $0.18643 up 5.51%.
The ASX200 had a mixed session yesterday ahead of the RBA cash rate statement today. The index started relatively flat and then rallied along with the Hang Seng and DOW before sellers came back into the action to push price lower into the close. The ASX ended the session down 43.3 points to 6014.6 with the Healthcare, Industrials and Materials sectors dragging most on the action. Rising stocks outnumbered declining ones by 648 to 554 and 344 ended unchanged.
The ASX200 is expected to open up 30 points as the US ramps higher to start the new week. Prices may be contained ahead of the RBA announcement at 2:30pm today.
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ECONOMIC DATA OUT TODAY (AEST)
JPY Average Cash Earnings and Household Spending 9:30am
AUD Cash Rate and RBA Statement 2:30pm
EUR German Industrial Production 4pm
EUR French Trade Balance 4:45pm
EUR Italia Retail Sales 6pm
USD FOMC Member Quarles Speaks 3am
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SPI200 INTRADAY LEVELS TO WATCH
