Daily Market Report by GulfBrokers 2020-2021

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Hydrogen truck maker Nikola Corp. surged 104% in its third day of trading on the NASDAQ after a reverse merger with VectoIQ Acquisition Corp. The stock bounded higher on Monday after Trevor Milton, the founder of Nikola Corporation tweeted that reservations for Nikola’s zero-emission truck, dubbed the Badger, would kick off later this month. Nikola Motor now is valued at $1.6 billion based on the Monday closing price of $73.27, which put the company’s market cap at $26 billion. The company was founded in 2016 and the vehicle maker has secured truck orders for a combined 14,000 units so far.

EQUITIES

Global stocks trading mixed on Tuesday amid concerns over geopolitical tensions including renewed trade tensions between the US and China, North Korea issued a warning to cut communication ties with South Korea after finding the movement of unacceptable material through the border and weak German data.

OIL

Crude oil prices drifted lower on Tuesday after Saudi Arabia said on Monday that those extra reductions will last just one month as planned, wouldn’t continue with additional, deeper curbs after June.

CURRENCIES

EUR/USD slightly recovered from early losses, at the time of writing the currency pair trading above 1.1260. During the European session, the pair dropped to a session low of 1.1240 after weaker-than-expected German trade data showed both exports and imports collapsed in April due to the coronavirus pandemic. Meantime, Japanese yen trading strong against other benchmark currencies after the Japanese government said, Japan’s Foreign Minister Motegi and UK Trade Minister Truss agreed to work on a swift agreement on an economic partnership to secure business continuity for both nations.

GOLD

Gold price surged the second consecutive session on Tuesday. The yellow metal price boosted by rise in geopolitical tensions and the investors anticipates the U.S. Federal Reserve will maintain its dovish stance at its policy-setting meeting this week.

Economic Outlook

The global economy is expected to shrink by about 5.2% in 2020 as a result of the coronavirus pandemic, making it one of the four most severe downturns in 150 years, the World Bank said Monday.

The Eurozone economy shrank by 3.6 per cent on quarter in the first three months of 2020, compared with preliminary estimates of a 3.8 per cent contraction. While monthly German exports shrunk by a more-than-forecast 24%, imports to the nation slumped by 16.5%, the Federal Statistical Office said Tuesday.

Coronavirus Update:

Coronavirus cases have crossed 7.1-million mark worldwide with 408,240 deaths. The United States continues to remain the worst-hit country with positive cases toll at 2,026,493 including 113,055 deaths. The total number of coronavirus cases in India has jumped to 267,046, while 7,473 people have died from the disease so far. Russia reported 8,595 new cases of the novel coronavirus on Tuesday, bringing the number of infections nationwide to 485,253.

Technical Outlook

EUR/USD:
The pair trading above 1.1270 on Tuesday. Any breaks below 1.1230/40 will open doors to 1.1190 support zone and on the upper-side the immediate resistance around 1.1320.

euraud


The important levels to watch for today: Support- 1.1240 and 1.1190 Resistance- 1.1285 and 1.1320.

AUD/USD: AUDUSD retreats from the resistance, after touching a 6- month high of 0.7040. The pair currently trading below 0.6950, any break below 0.6930 levels to pave the way for further weakness to 0.6900 and 0.6850.

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The important levels to watch for today: Support- 0.6900 and 0.6850 Resistance- 0.6960 and 0.7000.

Quote of the day: One of the many funny things about the stock market is that every time one person buys, another sells, and both think they are astute-William Feather.

Read more- https://gulfbrokers.com/en/daily-market-report-101
 
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Investors and traders will closely monitor the Fed statement later today that might add some volatility to the market. The Federal Open Market Committee (FOMC) will release FOMC Economic Projections and policy statement at 18.00 GMT followed by a Fed Chair Jerome Powell's press conference half an hour later. The Fed is expected to leave interest rates unchanged at the end of a two-day meeting.

EQUITIES

Asian markets traded mostly higher on Wednesday as investors await the outcome of the U.S. Federal Open Market Committee (FOMC) meeting. Hong Kong stocks ended the session higher, with the benchmark Hang Seng Index rising 1.1% to settle at 25057.22, the highest closing level in nearly three months. On Tuesday, Wall Street ended mostly lower but the NASDAQ climbed to a new record high by passing the vaunted 10,000-point mark for the first time.

OIL

Crude Oil prices dropped to the session low after the API reported US crude inventories unexpectedly rose 8.4 million barrels in the week to June 5th and the commodity also under pressure after the comments from Saudi Arabia that it won’t extend voluntary cuts in production.

CURRENCIES

Commodity currencies like the Australian dollar and New Zealand dollar recovered from the previous session losses and trading close to the week high. Overall the momentum remained bullish during the Asian session. The US dollar trading lower ahead of FED meeting as policymakers of the Fed are expected to unveil their first economic projections for this year after the pandemic hit the US economy.

GOLD

The yellow metal price trading steady above $1720 during the European trading session, the price boosted by geopolitical risks and a weak US dollar.

Economic Outlook

During the Asian session, the economic data revealed that the annual inflation rate in China fell to 2.4% in May from 3.3% in April and less than the market consensus of 2.7%. While China's producer prices also declined by 3.7% in May, posting the steepest deflation rate since March 2016.

Moving ahead today, the important events to watch:

  • US CPI and Core CPI – 12.30 GMT

  • US crude oil inventories report – 14.30 GMT

  • FOMC rate decision and economic projections – 18.00 GMT

  • FOMC press conference – 18.30 GMT
Coronavirus Update:

The number of confirmed cases of coronavirus around the world surpassed 7 million, of which more than 405 thousand died and over 3 million recovered. The US currently has the highest number of COVID-19 patients around the globe, reporting over 2 million cases so far.

Technical Outlook

EUR/USD:
The pair is back above 1.1350 and if the upside momentum continues the next important level to watch 1.1464.

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The important levels to watch for today: Support- 1.1320 and 1.1240 Resistance- 1.1380 and 1.1470.

AUD/USD: The currency pair recovered from the previous session low of 0.6900 and currently trading below 0.7000 levels.

audusd


The important levels to watch for today: Support- 0.6900 and 0.6850 Resistance- 0.7010 and 0.7050.


Quote of the day: An investor without investment objectives is like a traveller without a destination.

Read more- https://gulfbrokers.com/en/daily-market-report-102
 
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The e-commerce pet-care retailer Chewy Inc. (NYSE: CHWY) reported better-than-expected revenue for the first quarter. Chewy sales boosted recently after a decrease in shopping trips to the physical stores as many consumers opt for home delivery in this pandemic. According to the research from commercial café, more than 27% of Americans would order pet food online to ensure the needs of their pets are met, while only about 16% did so prior to the outbreak.

  • Earnings per share (EPS) $0.12 vs. $0.16 expected
  • Revenue $1.62 billion vs. $1.53 billion expected
“We had a strong start to 2020 with first-quarter net sales increasing 46 per cent year-over-year and gross margins expanding 50 basis points. We also achieved a significant milestone by delivering our first-ever quarter of positive adjusted EBITDA,” stated Sumit Singh, CEO of Chewy. “We are proud to be the e-tailer of choice for millions of new and existing pet parents during this unprecedented time.”

The company said it ended the quarter with 15 million active customers, up from 11.3 million the year prior. The other good news is, so far this year ratings in the Google Play Store have grown in number for Chewy's app by more than 39%. The company expecting revenue for this year to range from $6.55 billion to $6.65 billion, While Wall Street is expecting revenue to come in at $6.41 billion.

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The chewy stock closed 5.6% higher on Tuesday. The company shares have climbed 75% since the beginning of the year and the stock hit a 52-week high earlier Tuesday.

Read more- https://gulfbrokers.com/en/chewy-posted-strong-revenue-as-online-pet-food-demand-increases
 
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Tesla’s stock price climbed above $1,000 on Wednesday, bringing the market capitalization to $188 billion. The stock boosted after the company revealed an internal memo that signalled increased production of its electric Semi trucks. “It’s time to go all out and bring the Tesla Semi to volume production,” said CEO Elon Musk in the memo. “It’s been in limited production so far, which has allowed us to improve many aspects of the design. Production of the battery and powertrain would take place at Giga Nevada, with most of the other work probably occurring in other states,” he added.

EQUITIES

Global shares fell on Thursday after the Fed has eliminated the scenario of a V-shaped recovery for the US economy and sees the American economy is expected to shrink 6.5% this year. On Wednesday, in Wall Street, the Dow closed 1.04% lower and the S&P 500 lost 0.53%. Meanwhile, the NASDAQ added 0.67% to a fresh record helped by gains in Microsoft and Apple.

OIL

Crude Oil prices retreated from the previous high after another record build-up in U.S. crude inventories. The EIA inventories for the week ended on June 5 increased past -1.738M forecast to +5.72M barrels.

CURRENCIES

The US dollar rebounded from three months low on Thursday; the gloomy outlook from the US Federal Reserve boosted the safe-haven currency. The Japanese yen trading at its strongest level after the Japanese Lower House of Parliament approved an emergency budget worth nearly US$300 billion, bringing total stimulus measures to over 40% of GDP.

GOLD

The yellow metal prices trading slightly lower after reached a more than one-week high on Thursday. The gold price rose more than 1% on the previous session after the US Federal Reserve signalled its interest rates to remain there for the next few years.

Economic Outlook

On Wednesday, the Fed committed to using its full range of tools to support the U.S. economy in this challenging time. The central bank maintained the Federal Funds Rate at 0%-0.25% and the policymakers also anticipate no rate change till 2022.

Moving ahead today, the important events to watch:

US initial jobless claims report – 12.30 GMT

US Producer Price Index – 12.30 GMT


Coronavirus Update:

The number of confirmed cases of coronavirus around the world surpassed 7.24million, of which more than 415000 died and over 3 million recovered. Brazil, with 7, 72,416 cases, is the second country to have reported the maximum number of infections after the US followed by Russia (4, 93,023) and the United Kingdom (2, 91,588). Pakistan has registered its highest single-day spike of coronavirus cases with over 5,000 infections in the last 24 hours

Technical Outlook

EUR/USD:
The pair recovered from the early Asian session losses and currently trading above 1.1380.

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The important levels to watch for today: Support- 1.1320 and 1.1240 Resistance- 1.1420 and 1.1470.

GOLD: The gold price trading steady above $1730 during the European session and the next immediate resistance to watch $1745.

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The important levels to watch for today: Support- $1726 and $1718 Resistance- $1745 and $1765.

Quote of the day: Never invest in a company without understanding its finances. The biggest losses in stocks come from companies with poor balance sheets- Peter Lynch.

Read more- https://gulfbrokers.com/en/daily-market-report-103
 
The luxury jewellery maker Tiffany & Co (NYSE: TIF) released its first-quarter 2020 results on June 9. The company worldwide net sales declined 45% due to the retail stores closed across the global markets over COVID-19 lockdowns. The New York-based company shut down two of their stores during the quarter and it currently operates a total of 324 locations.
  • Earnings per share (EPS) $0.53 vs. $0.35 expected
  • Revenue $555.5 million vs. $701 million expected

“While the first quarter was very challenging with sales and earnings significantly impacted by COVID-19, the impact of which we expect to negatively affect our full-year sales and earnings relative to 2019, I am confident Tiffany’s best days remain in front of us because there is evidence that the strategic decisions we took to focus on our Mainland China domestic business, global e-commerce, and new product innovation are paying off - even against the backdrop of a global pandemic.” Tiffany’s CEO Alessandro Bogliolo said.

Worldwide sales numbers in the first quarter:

  • In America, sales were down 45% in the first quarter to $225 million.
  • In the Asia-Pacific region, sales tumbled 46% to $174 million.
  • In Europe, total net sales dropped 40% to $61 million.
  • In Japan, total net sales plunged 40% to $86 million.
Meantime, CEO Alessandro Bogliolo said, “our business performance in mainland China, which was the first market impacted by the virus, is indicative that a robust recovery is underway”. The easing of the lockdown helped the sales in China jumped 30% year on year in April and surged 90% in May after the sales tumbled 85% in February and fell 15% in March.

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Tiffany stock dropped 2% on Wednesday. The stock has a market capitalization of $14.80 billion. The $TIF has 50 days moving average of $126.21 and the 200-day moving average of $130.30. The stock has climbed 34% in the last 12 months.

Read more- https://gulfbrokers.com/en/tiffany-sales-down-45-due-to-store-closures
 
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The dovish comments from Federal Reserve and growing fears of a second wave of coronavirus infections sent the global markets tumbling Thursday, pulling the Dow Jones Industrial Average down more than 1,800 points, its worst day since March. The S&P 500 posted its worst loss since March after three consecutive days of losses.

EQUITIES

Asian markets fell on Friday after an overnight plunge on Wall Street, the Hang Seng index dropped 2.16%, and the Shanghai Composite down more than 1%, the Nikkei 225 slipped 2.05% while the Topix index fell 2.24%. On Thursday, in Wall Street the Dow collapsed 6.9 per cent, the S&P 500 dived 5.9 per cent and the NASDAQ tanked 5.3 per cent from a record high.

OIL

Crude Oil prices fell for a second consecutive trading session due to worries about weak global energy demand and fears mount about the second wave of US virus infections.

CURRENCIES

Commodity currencies like the Australian dollar and New Zealand dollar slightly recovered from the previous session losses. South Korean Won Appreciates against the dollar after the Bank of Korea said today that it will continue to deliver more stimulus into the economy hit hard by the COVID-19 crisis.

GOLD

The gold prices trading steady on Friday over concerns of the second wave of coronavirus infections. The yellow metal currently supported by $1726/$1730 and on the other side $1740/$1748.

Economic Outlook

On the data front, UK’s April month GDP dropped well below -18.4% forecast to -20.4% and manufacturing production plunged at a record 28.5 per cent year-on-year in April of 2020, following a 9.7 per cent drop in March. On Thursday, during the North American session, the US Unemployment Claims reported for last week decreased to 1.542M from the expected 1.550M.

On Thursday, Treasury Secretary Steven Mnuchin said the administration is weighing a second round of stimulus payments for Americans as part of an economic relief package Congress is likely to consider next month.

Coronavirus Update:

The number of confirmed cases of coronavirus around the world surpassed 7.5 million, of which more than 4, 23,086 died and 3,835,183 recovered. The US reported the highest deaths (1, 13,803), followed by the UK (41,364), Brazil (40,919), and Italy (34,167). The US remains the worst-affected country worldwide, passing 2 million infections on Thursday. Spikes have been recorded in several states, including Arizona, which is confirming more than 1,000 cases daily India reported 10,956 coronavirus cases in the past 24 hours, the highest single-day increase so far. The total number of reported coronavirus infections now stands at 297,535 with 8,498 deaths.

Technical Outlook

EUR/USD:
During the European session the pair rebounded to above 1.1330 after it slipped to 1.1290 in the previous session.

cruse


The important levels to watch for today: Support- 1.1280 and 1.1240 Resistance- 1.1360 and 1.1420.

AUD/USD: The currency pair slightly rebounded and trading below 0.69 after the biggest daily fall since the market turmoil of March.

audusd


The important levels to watch for today: Support- 0.6850 and 0.68 Resistance- 0.6930 and 0.6960.

Quote of the day: Keeping your ear to the ground in the markets is a sound investment - Amah Lambert.

Read more- https://gulfbrokers.com/en/daily-market-report-104
 
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