Daily Market Report by GulfBrokers 2020-2021

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Other than $NFLX, the FAANG stocks all reported Q2 financial results on Thursday, after the market close. Most surprisingly all four big giants reported better-than-expected earnings.

Apple (NASDAQ: AAPL) “Apple’s record June quarter was driven by double-digit growth in both Products and Services and growth in each of our geographic segments.” Tim Cook, Apple CEO said.

  • Earnings per share (EPS) $2.58 vs. $2.07 expected
  • Revenue $59.7 billion vs. $52.3 billion expected
Facebook (NASDAQ: FB) "We're glad to be able to provide small businesses the tools they need to grow and be successful online during these challenging times," said Mark Zuckerberg, Facebook founder and CEO.

  • Earnings per share (EPS) $1.80 vs. $1.39 expected
  • Revenue $18.7 billion vs. $17.4 billion expected
Amazon.com (NASDAQ: AMZN) “This was another highly unusual quarter, and I couldn’t be more proud of and grateful to our employees around the globe,” Jeff Bezos said, Amazon CEO.

  • Earnings per share (EPS) $10.30 vs. $1.46 expected
  • Revenue $88.91 billion vs. $81.56 billion expected
Alphabet (NASDAQ: GOOGL) “We’re all grappling with a pandemic and uncertain economy,” Alphabet CEO, Sundar Pichai said.

  • Earnings per share (EPS) $10.13 vs. $8.21 expected
  • Revenue $38.30 billion vs. $37.37 billion expected
EQUITIES

Global stocks trading mixed on Friday while US Nasdaq futures surged higher boosted by better-than-expected tech earnings.

OIL

Crude oil price slightly rebounded on Friday, during the previous session Oil prices fell to 3- weeks low.

CURRENCIES

The dollar index extended losses and hit the lowest since May of 2018. Meanwhile, EURUSD extended gains to 1.19 and the GBPUSD surged to 1.3142 during the European session.

GOLD

Gold price recovered from the previous session lows and during the European session, the yellow metal climbed back to near the all-time high of $1980 supported by negative US GDP numbers.

Economic Outlook

On Thursday, the US reported the second-quarter GDP numbers, the world’s largest economy contracted by a record 32.9% YoY, slowing down from -5% YoY in the previous period.

The important earnings to watch today: Exxon Mobil (NYSE: XOM) -Pinterest Inc. (NYSE: PINS) and Caterpillar Inc. (NYSE: CAT)

Coronavirus update:

The number of people infected with the coronavirus across the world surpassed 17.3 million, of which at least 673 thousand people have, according to data released by the Johns Hopkins University.

Technical Outlook

XAU/USD: The yellow metal price trading below the all-time high of $1980, any break above the next important level to watch $2000.

audusd


The important levels to watch for today: Support- 1940 and 1920 Resistance- 1982 and 2000.

EUR/USD: The currency pair slightly retreated from the fresh high of 1.1905 and at the time writing, the pair trading below 1.1850

cruse


The important levels to watch for today: Support- 1.1800 and 1.1740 Resistance- 1.1910 and 1.1950.

Quote of the day: Never stop investing, never stop improving, and never stop doing something new- Bob Parsons.


Read more- https://gulfbrokers.com/en/daily-market-report-136
 
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In recent months, the Coronavirus pandemic, and the U.S – China trade tensions have hit the United States extremely hard and this has resulted in a 5% contraction in the first quarter of 2020. As per the International Monetary Fund (IMF) expected the official data showed on Thursday that the US economy suffered its worst period ever in Q2, with GDP falling a historic 32.9%, slowing down from -5% in the previous period. Meanwhile, the US has already spent $3 trillion propping up the economy since the pandemic struck in March and which helped the economic recovery from mid-April to June was faster than many economists had expected.

“The pandemic represents a rare but narrow window of opportunity to reflect, reimagine and reset out the world” – Klaus Schwab, founder and executive chairman, World Economic Forum.

Reasons for USD sell-off and What next?

Recent dollar weakening suggests it is the market taking a view that the US economy could be about to come under further pressure. The greenback still struggling to find an upside momentum as concerns over the mounting number of infections, uncertainty around the next round of stimulus package and escalating tensions between the US and China.

Moving ahead the investors and traders eagerly waiting for the next round of stimulus, the US is preparing further support for the economy, including allocating $1,200 stimulus payments to Americans. On the last FOMC meeting, The Fed Chairman Powell hinted that the economy would need additional support measures to cope with the outbreak of the economic crisis. “The path forward for the economy is extraordinarily uncertain and will depend in large part on our success in keeping the virus in check,” Powell said.

US Dollar Technical Outlook

euraud


The US dollar index, a measure of the USD’s value against a weighted basket of foreign currencies. The index has broken down below 93.50 and at the time writing, the pair trading above 93 after found buyers near the key support at 92.50. This level on Dollar Index is very crucial and would be significant if it were to be breached. Any break below 92.50 the next support at the 92/91.80 level and on the upper side the Immediate resistance can be found at 93.50 and then 94.


When will the US economy recover?

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Yet since then, the US has suffered a surge in new coronavirus cases, the country is still struggling to contain infection rates and deaths from COVID-19. According to the latest figures published by Johns Hopkins University, In the US, there have been 4,601,526 confirmed cases and 154,002 deaths. On the other hand, the tensions between US-China continue to escalate following the closure of China’s Houston, Texas consulate. In retaliation, China has ordered the U.S. consulate in Chengdu to cease operations.

So, until a vaccine or effective treatment for Covid-19 is available the recovery of the world’s largest economy will not really get underway till the mid of 2021. However, the use of the potential vaccine can only be expected in early 2021. On last week, American biotechnology company Moderna's COVID-19 vaccine candidate moves into late-stage trial after securing an additional $472 million from the U.S. government to support.



"The economic costs of the crisis are being borne disproportionately by the poor and vulnerable, bringing into stark relief deep inequities that have long afflicted the US," the IMF said.


Read more - https://gulfbrokers.com/en/3-trillion-is-not-enough
 
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China’s manufacturing sector showed a further rebound in July to its strongest level since January 2011. On Monday, during the Asian session, the private survey showed The Caixin China Manufacturing PMI rose to 52.8 in July 2020 from 51.2 in the previous month, beating market consensus of 51.3. “Flare-ups of the epidemic in some regions did not hurt the improving trend of the manufacturing economy,” said Wang Zhe, senior economist at Caixin Insight Group.

EQUITIES

Global stocks started this week on a mixed note, while European stocks trading near to the session highs after the latest European zone Manufacturing PMI was revised higher to 51.8 in July 2020.

OIL

Crude oil price trading lower on Monday as investors continue to worry about a spike in coronavirus cases and its effects on the global economic recovery.

CURRENCIES

US Dollar index slightly rebounded from the crucial support zone 92.50 and the index dropped more than 4% in July, its largest monthly decline since September 2010. The British pound trading below the short-term support zone of 1.3050 on Monday after the UK Manufacturing PMI reported lower to 53.3 in July 2020, from the preliminary estimate of 53.6.

GOLD

Gold price started this week on a bullish note, during the Asian session the yellow metal price climbed to a fresh all-time high of $1984 supported by geopolitical tensions between the US and China.

Economic Outlook

Moving Ahead, this week Investors will likely keep a look at the important economic releases which includes the ISM manufacturing data on Monday, the Bank of England (BoE) rate decision on Thursday and the US jobs data on Friday.

On the US-China front, the US Secretary of State Mike Pompeo said Sunday that President Donald Trump will take action "in the coming days" against Chinese-owned software that he believes pose a national security risk.

Coronavirus update:

The number of people infected with the coronavirus across the world surpassed 18 million, of which at least 689 thousand people have, according to data released by the Johns Hopkins University. The US, Brazil, India, and Russia are currently the worst-hit countries in the world. The World Health Organisation said that it expects the Covid-19 pandemic to be of “lengthy duration” and that it remains “a public health emergency of international concern.”

Technical Outlook

XAU/USD:
The yellow metal prices slightly retreated from the fresh session highs, at the time of writing the gold price trading below $1970.

audusd


The important levels to watch for today: Support- 1963 and 1940 Resistance- 1984 and 1995.

EUR/USD: The currency pair trading below the previous week low on Monday after dollar found short term buyers near 92.50

cruse


The important levels to watch for today: Support- 1.1710 and 1.1670 Resistance- 1.1780 and 1.1830.

Quote of the day: It’s the old story again; Gold is being bought as a safe haven asset- Michael Widmer.

Read more - https://gulfbrokers.com/en/daily-market-report-137
 
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The Nasdaq climbed to a record high on Monday boosted by hopes for a fresh US fiscal stimulus package and tech shares rally. The Nasdaq Composite surged more than 1.5% to 10,902.80, beating its previous record high close on July 20. Microsoft jumped 5.6% on Monday after it confirmed that it is in talks to buy the US arm of TikTok. The Trump administration gave the company 45 days to make a deal before TikTok's US operations could be banned.

EQUITIES

On Monday Wall Street and European markets ended higher supported by strong manufacturing data from Germany, China, and the US. On the earnings calendar, American International Group AIG (NYSE: AIG) announced better-than-expected Q2 earnings on Monday. While the company revenue misses Wall Street estimates.

OIL

Crude oil price trading unchanged on Tuesday as Investors fears about oversupply in oil markets after OPEC+ decided to ramp up production starting this month.

CURRENCIES

In the currency market, both Euro and Pound rebounded from the psychological levels of 1.1700 and 1.3000. At the time writing both pairs trading around 1.1770 and 1.3050. Meanwhile, the Australian dollar trading steady on Tuesday after RBA hinted that a recovery from the COVID-19 crisis is now underway in most of Australia.

GOLD

Gold price trading sideways on Monday after hitting a fresh all-time high on Monday. If the price break above yesterday’s high the next crucial level to watch $2000.

Economic Outlook

On the data front, the Reserve Bank of Australia kept its cash rate unchanged at a record low of 0.25%. RBA Governor Philip Lowe said the accommodative policy would be maintained if it is required. Meanwhile, during the European session, the ECB Chief Economist Philip Lane said the central bank is committed to providing the support needed to boost the economic recovery.

Moving ahead to the North American session, the investors will closely monitor the fresh updates about the US fiscal stimulus package. The Republicans want the package not to exceed more than $ 1 trillion while Democrats want to offer a $3 trillion package.

Coronavirus update:

The number of people infected with the coronavirus across the world surpassed 18.2 million, of which at least 693 thousand people have, according to data released by the Johns Hopkins University. On Monday, the US saw a spike of 46,321 new coronavirus cases in the last 24 hours, taking its total to 4,711,323. Mexico reported 4,767 new confirmed coronavirus cases and 266 additional fatalities, bringing the total in the country to 443,813 cases and 48,012 deaths.

Technical Outlook

Dollar Index:
The greenback failed to break 94 levels on Monday and retreated to below 93.50 on Tuesday.

audusd


The important levels to watch for today: Support- 93 and 92.50 Resistance- 94 and 94.60.

EUR/USD: The currency pair recovered from early session lows and at the time writing the pair hovers near 1.1800(psychological level).

cruse


The important levels to watch for today: Support- 1.1760 and 1.1700 Resistance- 1.1810 and 1.1840.

Quote of the day: Invest only if you would be comfortable owning a stock even if you had no way of knowing its daily share price- Benjamin Graham.

Read more - https://gulfbrokers.com/en/daily-market-report-138
 
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The gold price hit an all-time high of $2038 on Wednesday during the European session. The recent upside rally supported by a weaker dollar, escalating tensions between the US and China and a large explosion in the Lebanese capital, Beirut. The safe-haven metal surged more than 30% this year boosted by lower interest rates and rising coronavirus cases.

EQUITIES

European and US stock futures trading higher on Wednesday supported by strong Eurozone and China PMI data and on hopes of further stimulus from the United States. On the other hand, the Wall Street Journal reported Tuesday that high-level talks between US and Chinese officials will be held Aug. 15 to discuss China's compliance with the trade deal signed in January.

OIL

Crude oil price Climbed to a fresh session high on Wednesday after a massive blast at Lebanon’s main port rocked Beirut and overnight, the API data showed a massive draw in crude oil inventories of 8.6 million barrels last week.

CURRENCIES

In the currency market, the US dollar edges lower against a basket of six major rivals. The Australian dollar climbed to 0.7200 during the European session supported by strong service PMI numbers and Gold price rally.

GOLD

The yellow metal price trading steady above $2030 on Wednesday and overall, the movement remained bullish throughout the Asian session.

Economic Outlook

On the data front, New Zealand unemployment rate declined to 4.0% in the second quarter. This number was better than the 5.8% increase that analysts were expecting. The participation rate dropped to 69.70% from the previous 70.50% while the employment change declined by 0.4% in the quarter.

On Monday, US President Donald Trump said he was weighing executive action as Congress and the White House struggle to break the impasse over another emergency relief package to counter the coronavirus' impact on U.S. families and the economy. Meanwhile, Treasury Secretary Steven Mnuchin said the goal is to strike a deal on legislation by the end of the week.

Moving ahead today, the important events to watch:

US ADP employment report – 12.15 GMT

US ISM non-manufacturing PMI – 14.00 GMT

US crude oil inventories – 14.30 GMT

Coronavirus update:

The number of people infected with the coronavirus across the world surpassed 18.5 million, of which at least 700 thousand people have died, according to data released by the Johns Hopkins University. Spain reported more 5,760 new coronavirus infections on Tuesday, and the regions of Iscar and Pedrajas have been put back into lockdown due to a surge in coronavirus cases.

Technical Outlook

Dollar Index
: The greenback extends losses ahead of US ADP numbers, at the time of writing the index trading below 93.50 support zone.

cruse


The important levels to watch for today: Support- 93 and 92.50 Resistance- 93.50 and 94.00.

AUD/USD: The commodity currency hovers near 0.72 during the European session and any break above this level the next level to watch 0.7225(Previous month high). On the downside, the immediate support at 0.7150.

audusd


The important levels to watch for today: Support- 0.7150 and 0.7100 Resistance- 0.7200 and 0.7230.

Quote of the day: As a trader, you often walk on the blade. Be careful and don’t step off- Marc Rich

Read more - https://gulfbrokers.com/en/daily-market-report-139
 
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The Bank of England kept interest rates at 0.1% and to keep its asset purchasing facility at £745bn for August. The Central bank said the unemployment will jump, with the rate at 7.5% at the end of 2020, before gradually declining from the start of next year and inflation is expected to fall further below the 2% target. The Bank has also revised downwards its estimates of growth going forward with UK economy predicted to grow by 9% in 2021, and 3.5% in 2022, this compares with previous growth estimates of 15% and 3% respectively.

EQUITIES


Wall Street ended higher on Wednesday after White House negotiators said they aim to reach a deal on a new corona-virus relief package by the end of the week. On the earnings calendar, Moderna Inc. (MRNA) reported a loss of $116.7 million in its second-quarter on Wednesday. While the company revenue jumped a 406% year-over-year, from $66.4 million last quarter compared with $13.1 million during the same quarter a year ago.

OIL

Crude oil prices slightly retreated from the previous session highs. On Wednesday, the EIA reported the U.S. stockpiles of crude fell 7.4 million barrels last week following an even larger decline the week before that.

CURRENCIES

In the currency market, the British pound surged to fresh 5-month high boosted by strong construction PMI numbers and BOE comments. Meanwhile, the Australian dollar edged lower after Australia's Prime Minister Scott Morrison has said that COVID-19 will cost the nation at least A$7 billion.

GOLD

Gold price climbed new all-time high on Wednesday as investors have been rushing towards safe-haven assets due to geopolitical tensions, US-China trade tensions and global economic uncertainty.

Economic Outlook

On the data front, UK Construction surged to 58.1 in July 2020 from 55.3 in the previous month, beating the market expectations of 57.0.

On Wednesday, the US announced the latest ADP employment numbers, which indicated that private sector employment grew by only 167K jobs in July, while analysts had expected an increase of 1.5M.

On the US-China front, “With parent companies based in China, apps like TikTok, WeChat, and others are significant threats to the personal data of American citizens, not to mention tools for CCP content censorship,” Mike Pompeo said at a press conference on Wednesday.

Coronavirus update:

Coronavirus has infected over 16.4 million people worldwide and claimed 6,53,353 lives. The United States recorded 52,810 new Covid-19 cases and 1,388 virus-related fatalities on Wednesday, according to Johns Hopkins University data. Mexico overtook Britain to become the third hardest-hit country in virus deaths - after Brazil and the US - with more than 46,600 fatal cases.


Technical Outlook

XAU/USD:
The yellow metal price hovers near the record high of 2055 on Thursday, any break above this level the next important resistance to watch 2070.

audusd


The important levels to watch for today: Support- 2028 and 2010 Resistance- 2055 and 2070.

EUR/USD: The currency pair slightly retreated and trading around 1.1850 during the European session after hitting a fresh session high of 1.1915.

cruse


The important levels to watch for today: Support- 1.1830 and 1.1780 Resistance- 1.1880 and 1.1915.


Quote of the day: We don’t have to be smarter than the rest; we need to be more disciplined than the rest – Warren Buffet.

Read more- https://gulfbrokers.com/en/daily-market-report-140
 

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