DAILY MARKET REPORT - Wednesday, July 01, 2020

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European stocks and EUR/USD trading lower on Wednesday despite the release of the upbeat economic data. Germany Manufacturing PMI climbed higher to 45.2 in June of 2020 from a preliminary of 44.6 and 36.6 in the previous month and the German jobless rate ticked lower to 6.4% in June. While German retail Sales expanded at a monthly 3.8% during May, the biggest increase since February.

EQUITIES

Asian markets opened slightly higher on Wednesday. On Tuesday, Wall Street ended higher, the S&P 500 finished at 3,100.29, around 20 per cent for the quarter, the biggest gain since 1998. The stock markets in Hong Kong are closed for a holiday.

OIL

Crude oil prices rose on Wednesday after the API data showed crude inventories in the United States fell much more than expected. The American Petroleum Institute reported a larger-than-expected crude oil stock draw from previous 1.749M to -8.156M on June 26.

CURRENCIES

The commodity currencies like the Australian dollar and New Zealand dollar gained on Wednesday after Oil price jumped more than 1% and stronger than expected China's Caixin Manufacturing PMI.

GOLD

Spot gold climbed near an eight-year peak on Wednesday, as a spike in coronavirus cases in all over the world has cast a shadow on hopes for a quicker global economic recovery, driving inflows into safe-haven assets. The yellow metal gained more than 12% in the second quarter of 2020, its best quarter since end-March of 2016.

Economic Outlook

On Wednesday during the Asian session, a quarterly Bank of Japan survey showed Japanese manufacturers’ sentiment plunged to its lowest level in more than a decade, the manufacturers’ sentiment worsened to -34 in June — its lowest level since June 2009, as compared with -8 in March.

On the data front, on Tuesday, The US Consumer Confidence Index increased in June, after virtually no change in May. The index rose by 12.2 points to 98.1. Meantime, Jerome Powell, Chairman of the Federal Reserve, also testified on Capitol Hill, warning that without controlling the disease, the output will not return to pre-pandemic levels.

Moving ahead today, the important events to watch:

US ADP employment report - 12.15 GMT

US Manufacturing PMI - 13.45 GMT

US ISM Manufacturing PMI - 14.00 GMT

US Crude oil inventories - 14.30 GMT

US FOMC minutes - 18.00 GMT

Coronavirus Update:

The number of people infected with COVID-19 across the world crossed 10.45 million, of which around 505 thousand have died. The number of confirmed cases grew by 163,865 in the past 24 hours and the number of fatalities increased by 3,946. The biggest number of coronavirus cases was reported from the United States (2,537,636), Brazil (1,344,143), Russia (647,849), and India (566,840).

Technical Outlook

XAU/USD:
The yellow metal trading steady above $1780 on Wednesday and overall the momentum remained bullish throughout the day.

audusd


The important levels to watch for today: Support- 1780 and 1766 Resistance- 1792 and 1800.

GBP/USD: The currency pair surged to fresh week-high of 1.2410 and tested the trend line and at the time of writing the pair trading below 1.2400.

euraud


The important levels to watch for today: Support- 1.2360 and 1.2330 Resistance- 1.2440 and 1.2480.


Quote of the day: In the short run, a market is a voting machine but in the long run it is weighing machine- Benjamin Graham.

Read more- https://gulfbrokers.com/en/daily-market-report-117
 
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