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OVERNIGHT MARKET SNAPSHOT FOR WEDNESDAY 18/11/20 (as at 8am AEDT)
- SPI200 (Sept) overnight futures up 8 pts to 6509
- SP500 down 16.21 pts to 3610.70
- NASDAQ down 24.78 pts to 11,899.34
- Dow Jones down 167.09 pts to 29,783.35
- FTSE100 down 55.96 pts to 6365.33
- DAX30 down 5.14 pts to 13,133.47
- GOLD futures US session (Dec) down $7.40 to $1880.40 an ounce
- COPPER futures (Comex Dec) down $0.0128 to $3.2092 a pound
- OIL futures US Session (Nymex Dec) up $0.08 to $41.42 a barrel
- CRB Index up 0.71 pts to 154.52
- AUDUSD trading at 0.7305
- EURUSD trading at 1.1864
- GBPUSD trading at 1.3258
- USDJPY trading at 104.1900
- USD Index US Session (ICE Dec) down 0.208 to 92.422
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US indexes opened weak but managed to rally and wipe off most of the losses into the close. Data out showed retail sales figures were weaker than expected to pressure sentiment on the open but continued vaccine hopes had traders buying the dip. Retail spending was hampered by continued virus infections and a lack of any new stimulus to offset declining household incomes. The Fed Reserve reiterated the need for support from both fiscal and monetary policy. It is unlikely that there will be any new stimulus decision before Biden is sworn in on Jan 20th which puts pressure on the Fed to take up the slack and pump more money into the economy. Buyers continue to be torn between the increasing number of virus cases leading to further restrictions and more job losses to squeeze incomes and spending, and vaccine hopes to support a move back to the ‘norm’. It is anticipated that the rollout of vaccines will be challenging and not as quick as expected. The DOW closed down 0.56% while the broader SP500 ended down 0.45% and the Nasdaq closed down 0.21% for the session. In Europe, major Indexes ended lower as buyers took their foot of the pedal and locked in some gains. Virus restrictions continue to weigh on sentiment to cap the enthusiasm into the market. The key indexes may play catch up tonight on the European open as the US rallied into the close.
The USD Index continues to come under pressure and holding lower levels as traders see further weakness in the economy. It seems that traders are looking at the data and feel that a lot more stimulus is needed to support jobs and spending as the pandemic continues to strain businesses. The dollar broke back below the 92.600 level and now looks set to test lows around 92.140. The EURUSD sees buyers remaining in control to hold higher levels. Price has now edged back up into resistance around 1.1885 so it will be interesting to see if bulls can breach resistance to trade up through 1.1920 to test towards 1.1965. The GBPUSD continues to be bullish as buyers took price higher. Once some buyers were flushed out with a spike lower to 1.3192, price was able to break cleanly above the 1.3227 area and run higher. Expect to see another higher low hold for further pressure to the upside. The AUDUSD took a hit off the 0.7340 resistance zone to move lower. The action could see further downside if 0.7289 can not hold. This would seem to depend on the stock market sentiment today and whether buyers are happy to add further risk to portfolios. The USDJPY continued lower as the dollar fell. Price pushed back into support around 104.000 so it will be interesting to see whether buyers step in to support price or whether new lows are on the cards.
SPOT GOLD was holding up relatively well under pressure from the rise in the USD until the final hour where support broke to trigger stop losses below 1884. Rallies continue to be met with selling pressure so we do not expect to see any love into gold yet. Crude Oil continues to look constructive for a longer term move up…although it will not be without some swings lower to clean out buyers and reset. The 40.50 lows are set to be a higher low and drag in more buyers on expectations that vaccines will support a sustainable lift in demand. Copper did not perform as well with a spike lower to clean out buyers on the back of stock market weakness coming into the US open. Price did recover the losses and continues to looks supportive for the long term rally.
Cryptocurrencies added to the previous rally to move higher across the board. Bitcoin is on a charge and is set to test all time highs at this rate. Bitcoin is currently trading at $17670.0 up 5.01% while Ethereum is at $482.53 up 4.19% and Ripple is at $0.30131 up 4.76%.
The ASX200 ended up having a rather lackluster session yesterday as price opening stronger but faded into the close to end the day up only 13.9 points to 6498.2. The Energy sector was a stand out winner being up 3.43% and Financials also put in a good effort while the Gold sector ended the day down 4.14%. Rising stocks outnumbered declining ones by 684 to 681 and 278 ended unchanged.
The ASX200 is expected to open flat after the SPI200 swung between gains and losses into the US close.
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ECONOMIC DATA OUT TODAY (AEDT)
AUD RBA Gov Lowe Speaks 9am
AUD MI Leading Index 10:30am
JPY Trade Balance 10:50am
GBP CPI and PPI Data 6pm
EUR CPI Data 9pm
GBP MPC Member Haldane Speaks 9:30pm
CAD CPI Data 12:30am
USD Building Permits and Housing Starts 12:30am
USD Crude Oil Inventories 2:30am
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SPI200 INTRADAY LEVELS TO WATCH
