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OVERNIGHT MARKET SNAPSHOT FOR FRIDAY 23/10/20 (as at 8:00am AEDT)
- SPI200 (Sept) overnight futures up 1 pts to 6170
- SP500 up 17.93 pts to 3453.49
- NASDAQ up 21.31 pts to 11,506.01
- Dow Jones up 152.84 pts to 28,363.66
- FTSE100 up 9.15 pts to 5785.65
- DAX30 down 14.58 pts to 12,543.06
- GOLD futures US session (Dec) down $23.0 to $1906.50 an ounce
- COPPER futures (Comex Dec) down $0.0337 to $3.1648 a pound
- OIL futures US Session (Nymex Dec) up $0.58 to $40.61 a barrel
- CRB Index up 0.73 pts to 151.77
- AUDUSD trading at 0.7116
- EURUSD trading at 1.1819
- GBPUSD trading at 1.3079
- USDJPY trading at 104.8600
- USD Index US Session (ICE Dec) up 0.351 to 92.950
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US indexes were again supported by the talk of stimulus as the merry-go-round that is politics continues. Pelosi said that talks were going well for another round of stimulus and a deal could be hammered out soon while the opposite side of the fence said there are still significant policy differences that remain a hurdle. The talks and stimulus topic has been kicked around in media for so long that any positive effect on markets may already be baked into current prices and may not have the impact that most bulls will be hoping to see. Data out on employment, although a bit better than expected, still shows that the labour market recovery is struggling as support from the previous stimulus package fades into the background and virus problems persist. The DOW closed up 0.54% while the broader SP500 ended up 0.52% and the Nasdaq closed up 0.19% for the session. In Europe, major Indexes started the session well on the back foot but managed to lift during the session to end back near breakeven on the day. Prices were supported by Britain’s Finance Minister who unveiled billions of pounds more of financial aid for pandemic-hit businesses.
The USD Index bounced back from the previous sessions weakness to lift into the US close. Price may now be looking to retest the 93.00 level to see if it provides resistance in which case expect to see another move lower in the near term. Stimulus talks continue to produce the swings into the dollar which is expected to continue through to elections. The EURUSD found sellers up in the offer zone as buyers were happy to lock in some gains from the run up as the USD bounced. From here we may see a pop up if the dollar reacts lower off the 93.00 level…if not then watching for a higher low to hold potentially around the current level at 1.1815. The GBPUSD also saw some profit taking to move lower on the dollar rally. The question is now if the positive Brexit news can give the pound another kick and if buyers can hold the 1.3065 area. The AUDUSD looks rather bullish as price held a higher low at 0.7093 even under pressure from a rallying USD. If the level can hold then expect to see a move up through 0.7135 but we do not want to see a move down through 0.7108 from here which will change the landscape a bit. The USDJPY rallied to squeeze out sellers but the move up is a bit of a grind which suggests expectations for a further move lower in the dollar if 93.00 holds. For now momentum is up and price is holding higher lows.
SPOT GOLD was again hit pretty hard as the dollar rallied. The 1932 area proved to be strong resistance triggering the recent buyers to lock in some gains. Price still has the potential for a bigger squeeze lower if the 1900 level can not hold but expect that this will depend on the dollar moving up through 93.00. Crude Oil managed to find some buyers to swing higher coming into the European session. Longer term, price remains happy to hold in a wide range from the 39.20/39.50 zone up to the 41.70 area. Copper took a breather in a constructive move down which suggests that bulls are preparing to step back into the action to continue the march higher. If the 3.1425 area holds, then watch for a higher low to build.
Cryptocurrencies had another good session to continue the push higher. Bitcoin is currently trading at $13121.0 up 3.28% while Ethereum kicked on strong and is at $418.69 up 5.80% and Ripple is at $0.26198 up 4.18%.
The ASX200 yesterday was sold hard on the open on news that Iran and Russia have interfered with US elections; but as fast as it fell, it rallied just as hard as bulls bought the dip to recover the index 75 points into the close. In the end the damage was limited as the index ended down 18 points to 6173.8 with Metals and Mining and the Materials sectors being the best performers while Energy weighed most on the action. Falling stocks outnumbered advancing ones by 737 to 532 and 338 ended unchanged.
The ASX200 is expected to open flat after the SPI200 managed to hold on to the highs from the days session.
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ECONOMIC DATA OUT TODAY (AEST)
AUD Flash Manufacturing and Services PMI 10am
GBP Retail Sales 5pm
EUR French Flash Manufacturing and Services PMI 6:15pm
EUR German Flash Manufacturing and Services PMI 6:30pm
EUR Flash Manufacturing and Services PMI 7pm
GBP Flash Manufacturing and Services PMI 7:30pm
USD Flash Manufacturing and Services PMI 12:45am
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SPI200 INTRADAY LEVELS TO WATCH
