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OVERNIGHT MARKET SNAPSHOT FOR FRIDAY 8/01/21 (as at 8am AEDT)
- SPI200 (Mar) overnight futures up 21 pts to 6672
- SP500 up 55.65 pts to 3803.79
- NASDAQ up 326.69 pts to 13,067.48
- Dow Jones up 211.73 pts to 31,041.13
- FTSE100 up 15.10 pts to 6856.96
- DAX30 up 76.27 pts to 13,968.24
- GOLD futures US session (Feb) up $6.90 to $1915.50 an ounce
- COPPER futures US session (Comex Mar) up $0.0568 to $3.7073 a pound
- OIL futures US Session (Nymex Feb) up $0.31 to $50.94 a barrel
- CRB Index up 0.21 pts to 172.31
- AUDUSD trading at 0.7770
- EURUSD trading at 1.2276
- GBPUSD trading at 1.3564
- USDJPY trading at 103.8200
- USD Index US Session (ICE Mar) up 0.261 to 89.763
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US indexes continued to push higher in another strong session as the Democrats take control of the senate and pave the way for further stimulus. Trump is in hot water after the ‘Trump Mob’ stormed the US Capitol as many are calling for his removal from office and to invoke the 25th Amendment. The Democrat win may give the market some support on expectations for more infrastructure spending and a more aggressive stimulus package to support the US through the current pandemic induced downturn. Unemployment data out prior to Payrolls tonight, showed that the numbers of individuals filing for benefits for the first time remains high as layoffs announced by US companies surged 18.9% in December. This may set up for some volatility in the US session tonight if payrolls come out a lot weaker than expected. The DOW closed up 0.69% while the broader SP500 ended up 1.48% and the Nasdaq closed up 2.56% for the session. In Europe, major Indexes added to the previous sessions gains as commodity linked stocks helped to support the markets. The German DAX closed at new all time highs while the FTSE is on the way higher as bulls finally broke the index up and out of its trading range. Buyers were supported by the expectations of a bigger US stimulus package and more political certainty in the US.
The USD Index found some buyers down around the 89.300 zone to provide support although continues to hold below the 90.000 zone resistance. The move up may be due to some traders squaring up short positions ahead of the US employment data out tonight. If the numbers come out weaker than expected, expect the selling pressure to continue especially with the building expectation for a bigger aid package. Also helping the Dollar was a rally in long dated bonds which suggests a stronger recovery is expected and hence a stronger Dollar in the long term. The EURUSD took the opportunity to squeeze out some buyers and pushed lower which added to the Dollar strength. Price remains in an uptrend though until we see a clear break down below the 1.2240 area. The GBPUSD is coming under pressure as price holds lower levels. Short term buyers continue to provide support around 1.3542 which may be a target for a stop hunt soon and trigger a break of the level and move much lower. The AUDUSD also saw some heat come out of the action and could not break into new highs. Price pushed below the 0.7765/70 zone to clear out some buyers but, like the Euro, remains in an uptrend. If the US starts to gain some upward momentum, we expect to see a decent unwind of long positions. We will be watching to see if support holds at 0.7734 today ahead of US employment data. The USDJPY rallied to resistance around 103.900 before easing into the close. A rally through 90.000 on the USD Index will see the USDJPY break up through resistance. If the dollar is contained into payrolls tonight then expect 103.900 to hold and recent buyers square up positions to pressure the pair lower.
SPOT GOLD saw some chop after the previous sessions move lower to the 1900 zone. Bulls are putting up a fight and banking on another dip in the USD. If US inflation expectations grow then we expect to see Gold take another hit as the need for any safe haven buying disappears. Crude Oil continued to edge higher as the outlook for global growth looks better on the Biden confirmation. Oil pushed up through the 51 level but buyers were hampered by a rally into the dollar. If the 50.50 zone holds in the near term expect to see continuation higher. Copper rallied on the US open and managed to consolidate the gains into the close. Price may be extended in the near term although we expect that the more certainty in the global outlook will continue to provide support.
Cryptocurrencies put in another good session but not without a little chop to clear out some late buyers as many will be anticipating some profit taking. Bitcoin is currently trading at $39748 up 9.80% while Ethereum is at $1243.81 up 5.15% and Ripple surged higher and is at $0.33096 up 25.39%.
The ASX200 had a strong open yesterday and never looked back as the index ended the session up 104.9 points to 6712. It was a big day for the Energy sector along with Resources, Metals and Mining and Materials which all ended up over 4%. Rising stocks outnumbered declining ones by 710 to 615 and 355 ended unchanged.
The ASX200 is expected to open up 20 points after the SPI200 held on to the day sessions gains and the US showed enthusiasm for a Democrat led Congress.
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ECONOMIC DATA OUT TODAY (AEDT)
EUR German Industrial Production and Trade Balance 6pm
EUR French Industrial Production and Trade Balance 6:45pm
EUR Unemployment Rate 9pm
CAD Employment Change and Unemployment Rate 12:30am
USD Non-Farm Employment Change and Unemployment Rate 12:30am
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SPI200 INTRADAY LEVELS TO WATCH
