DAILY MARKET REPORT - Thursday, Aug 20, 2020

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On the US-China front, China’s Commerce Ministry confirmed that it plans to hold trade talks with the US in the coming days. meanwhile, US Navy sailing in the Taiwan Strait is "extremely dangerous" and it is "not in line with the fundamental interests of China and the United States," the Chinese military noted.

EQUITIES

Global stocks trading lower on Thursday after the US Federal Reserve's latest meeting minutes highlighted doubts about the recovery of the world's largest economy. On Wednesday, Apple stock made history, the iPhone maker became the first US company to be valued at US$2 trillion. Its market value doubles in two years and its shares are currently priced at $462.83.

OIL

Crude Oil prices trading lower on Thursday after the OPEC+ warned that a second extended wave of coronavirus infections could hamper the oil market recovery. While the EIA US crude inventories came in at -1.632M – lower than the expected -2.67M barrels.

CURRENCIES

In The currency market, the EUR/USD fell back to near 1.18 area after weaker – than- expected Eurozone inflation numbers and the strong dollar move.

GOLD

The gold price plunged more than 3% on Wednesday after the FOMC minutes revealed that policymakers expressed little support regarding capping bond yields and the Fed remains genuinely concerned about the US economic recovery.

Economic Outlook

According to the latest FOMC minutes, the members agreed at their latest meeting in late July that the ongoing situation surrounding the coronavirus pandemic could weigh heavily on economic activity, employment, and inflation in the near term and was posing considerable risks to the economic outlook over the medium term. The readout on Fed discussions provides hints to further action that the U.S. central bank could take in September. No change in interest rate policy is expected until end-2021.

On the next US stimulus package front, on Wednesday, a senior Trump administration official said that a smaller coronavirus relief bill, to the tune of about $ 500 billion, could be approved, as opposed to a package of between $ 1 trillion and $ 3 trillion, as was previously expected, since Congress had been unable to reach any agreement.

Moving ahead today, the important events to watch:

Eurozone ECB Monetary Policy Meeting Accounts – 11.30 GMT

US Jobless claims – 12.30 GMT

US Philadelphia Fed Manufacturing Survey – 12.30 GMT

Coronavirus update:

The number of people infected with the coronavirus across the world crossed 22.4 million, of which at least 788 thousand people have died and 14.3 million have recovered, according to data released by the Johns Hopkins University. The United States reported 46,436 new coronavirus cases and 1,356 new virus-related deaths on Wednesday, according to Johns Hopkins University. Germany's number of confirmed coronavirus infections increased by 1,707 to 228,621 in the past 24 hours. The new cases mark Germany's highest daily toll since April when the pandemic was at its peak.

Technical Outlook

XAU/USD:
The gold price trading below $1930 during the European session after the yellow metal broke the $1940 support zone.

euraud


The important levels to watch for today: Support- 1920 and 1900 Resistance- 1940 and 1960.

Dollar Index: Dollar rebounded from the 27 - months low, at the time of writing the pair trading above 93. The next upside to watching 93.40 then 94.00.

cruse


The important levels to watch for today: Support- 92.50 and 92 Resistance- 93.40 and 94.00

Quote of the day: Whether we are talking about socks or stocks, I like buying quality merchandise when it is marked down- Warren Buffet.

Read more- https://gulfbrokers.com/en/daily-market-report-150
 
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