Daily Market Updates 03.08.2020
Monday 03.08.2020
Asian Session
Asian stocks were mixed with US equities, amid resurgence of coronavirus cases, along with the US-China tensions. Stocks in Japan and China advanced even higher after a private survey showed China’s manufacturing activity expanding by more than expected in July, while mainland-listed tech stocks surged on expectations that Beijing will respond supportively to U.S. moves on Chinese-owned software companies. Equities declined in Hong Kong and tension between the two biggest economies in the world is another threat to risk appetite.
| Asian Stock | Closed |
| Nikkei | -2.82% |
| Hong Kong HSI | -0.47% |
| China Shanghai SSE | +0.71% |
| KOSPI – South Korea | -0.77% |
US Stocks
After the busy previous week on corporate earnings of big tech companies’ investors now eyeing on Washington and the economy. Dow Jones, SP500 and Nasdaq on futures index have little changed as of yesterday’s midnight. The S&P 500 gained 5.5% in July, while the Dow and the Nasdaq Composite rose 2.3% and 6.8%, respectively. US equities rose on Friday, but the three major indexes closed the week mixed, with the Dow dipping slightly while the S&P 500 SPX, +0.76% and Nasdaq COMP, +1.48% made gains. This week, Wall Street will see quarterly earnings reports from 130 members of the S&P 500.
| US Stocks | Closed |
| DOW | +0.39% |
| S&P500 | +0.76% |
| NASDAQ | +1.48% |
Major Currencies
Euro confirmed the overbought condition on last Friday closing, as dollar got stronger against euro and the pair closed to 1.177 from 1.19 intra-day highs. According to Refinitiv, about 1.36 million new US jobs are expected, well below the 4.8 million added in June, and the unemployment rate is expected to fall to 10.7% from 11.1% and may support dollar. Other provisions, such as another round of $1,200 stimulus checks, have broader support from both political parties. Further down, 1.1625 and 1.1540 are observed. USD/JPY is seen navigating within the 105.00/107.00 range within this week, suggested FX Strategists at UOB Group. Despite dollar bounce Dollar/Yen upticks lacks and the daily RSI remains bearish ahead of the US ISM data. In the short term a bearish momentum is expected with a resistance level be at 106.4. A shooting star candlestick pattern observed in pound/dollar on Friday closing indicating that pound may drop back to 1.29 price range after the sharp advance during last week and July with over 5.5% gains. A combination of factors such as no deal Brexit, coronavirus woes and dollar pullback lead pound lower. Bulls stay hopeful over the Tory government’s ability to offer more stimulus, positive trade talks with the US and Japan.
Gold Market
Gold prices eased from the early day record high level of $1,988 per ounce during the pre-European session today. The precious metal keeps the higher high formation intact, although its repeated failures to reach $2,000 per ounce after each run-up. According to CME investors have decreased their open interest in gold futures by 26.1k, indicating that further upside is limited and some correction to the downside it is expected in the short term so there is a potential of a postponement to touch the psychological $2,000 per ounce.
Oil Market
Oil closed even lower close to $40 per barrel as OPEC and its allies’ producers commenced supplying more crude Oil globally where many countries are still struggling to contain the coronavirus. More specifically OPEC will supply about 1.5 million barrels during this month, which is more than in July and Russia has already started lifting its output. West Texas Intermediate (WTI) for September delivery fell by 0.6% to $40.04 per barrel after rising 2.6% in July. Brent for October settlement slipped 0.3% to $43.37 per barrel after gaining 0.6% on Friday.
European Stocks
European equities were expected to open higher today as they did ahead of one more week of corporate earnings, while the US lawmakers attempt to provide a new coronavirus aid package. Stoxx600 closed lower on Friday by 0.89%. All eyes turn today to HIS Markit Manufacturing PMI for the eurozone.
On the data front 03-08-2020
| Time (GMT+3) | Event | Impact |
| 09:30 am | CHF Consumer Price Index (YoY)(Jul) | Medium |
| 10:15 am | EUR Spain-Italy Markit Manufacturing PMI(Jul) | Medium |
| 11:30 am | GBP Markit Manufacturing PMI(Jul) | Medium |
| 17:00 pm | USD ISM Manufacturing PMI(Jul) | High |
