Daily Market Report by GulfBrokers 2020-2021

[syamfx2020]

UberEats the parent company of Uber Technologies (UBER) and Grubhub (GRUB) one of the oldest food delivery company in the US continue their merger discussions. According to a recent update from WSJ the Grubhub's CEO Matt Maloney reportedly rejected Uber CEO Dara Khosrowshai's latest offer of 1.9 of its shares for every Grubhub share, saying that price was too low. Uber said it could offer up to 1.925 Uber shares, however, that is still well below the price GrubHub had been seeking.

Uber Eats accounted for 20 per cent of US meal delivery sales in March and Grubhub had 28 per cent. A combined operation would overtake the number one player DoorDash, which had 42 per cent. According to the New York Times, a combination of Uber Eats and Grubhub would equate to about 55% of the U.S. food delivery market share.

UBER (NYSE: UBER)

Uber announced an overall net loss of $2.9 billion and 3,700 layoffs in its first-quarter earnings report. But within Uber Eats, gross bookings increased 54% year-over-year. On Tuesday, May 12 Uber shares increased modestly, up to $34 per share upon initial reports of a possible deal.

GRUBHUB Inc. (NYSE: GRUB)

Grubhub is the second-largest U.S. restaurant delivery provider. The company released a statement Tuesday not acknowledging or denying the talks, but admitting “consolidation could make sense in our industry.” Grubhub stock jumped around 29% on Tuesday after the deal news, causing a temporary halt on trading due to increased volatility.

 

[syamfx2020]

Moderna, Inc. (NASDAQ: MRNA), an American biotechnology company, working on developing a vaccine, announced on Monday that the early results from the vaccine were promising from its first human trial. The company said it is launching a large clinical trial in July to determine whether the vaccine works.

EQUITIES

Global stocks surged on Monday after Moderna Inc. announced positive interim Phase 1 Data for its mRNA Vaccine and Fed’s comments that the US economy is expected to recover steadily towards the second half of the year but the recovery could drag through 2021.

OIL

Oil prices rose slightly on Tuesday amid signs that producers are cutting output as promised just as demand picks up, stoked by more countries easing out of curbs imposed to counter the coronavirus pandemic.

CURRENCIES

EURO dollar climbed to two weeks high of 1.0955 after French President Macron and German Chancellor Merkel agreed on Monday to create a €500 billion Recovery Fund to support the economies hit hardest by the coronavirus pandemic. The dollar index depreciated for the 3rd straight session to trade below 99.5 on Tuesday as the market sentiment receives a boost from emerging news reports about the progress towards developing a vaccine against COVID-19.

GOLD

Gold prices fell on Monday due to early positive results from a vaccine of COVID-19, which raised US equity markets and decreased the demand for safe-haven instruments.

Economic Outlook

During the Asian session, the minutes from RBA’s latest meeting reveal the central bank admitting that Australia’s economy is set to experience an unprecedented contraction in the wake of the coronavirus pandemic, but fiscal and monetary stimulus measures can help offset some of the impacts.

Moving ahead today, the important events to watch:

US Housing starts and building permits – 12.30 GMT

Fed Chair Jerome Powell testimony – 14.00 GMT

Coronavirus Update:

Worldwide coronavirus cases pass 4.8 million, death toll crosses 319,000. The United States is the worst hit with 88,719 deaths and 1.49 million cases. The number of Coronavirus infections in India crossed the 1, 00,000 figure mark on Monday, with over 4,500 new cases being discovered. China reported six confirmed coronavirus cases for May 18, including a new case in Wuhan.

Technical Outlook

GOLD: The yellow metal price slightly recovered from the early losses and currently the pair trading above $1735.

The important levels to watch for today: Support- $1720 and $1708 Resistance- $1745 and $1760.

EUR/USD: The pair currently testing the trend line resistance, any break above this level will open 1.0980 and 1.10.

The important levels to watch for today: Support- 1.0910 and 1.0870 Resistance- 1.0980 and 1.1010.

Quote of the day: If you are going to invest in an internet stock, you must be a long-term investor, Jeff Bezos.

 

[ScottHughes]

Good it's about time we all got back to action. See the markets pump this week

 

[syamfx2020]

On Monday, FedEx (FDX) and Microsoft (MSFT) announced a multi-year collaboration that will combine FedEx’s logistics capabilities with Microsoft’s cloud technology. The shares of FedEx jumped 10.85% on Monday after the announcement. “FedEx has been reimagining the supply chain since our first day of operation, and we are taking it to a new level with today’s announcement,” said FedEx CEO Frederick Smith in a statement. "Together with FedEx, we will apply the power of Azure, Dynamics 365 and their AI capabilities to this urgent need, building new commerce experiences that transform logistics for our mutual customers around the world." Microsoft Chief Executive Satya Nadella said in a statement.

EQUITIES

Asian markets traded mixed on Wednesday following the People's Bank of China's (PBoC) decision to keep its interest rates unchanged at 3.85%. On Tuesday Wall Street ended lower after a report from medical news website Stat cast doubt over positive early results from a Moderna Covid-19 vaccine trial. The Dow Jones retreated 391 points or 1.6% to 24,207. The S&P 500 shed 31 points or 1.1% to 2923. The NASDAQ lost 50 points or 0.5% to 9185.

OIL

Oil prices received some support from the API report. According to the report, the US weekly crude oil stock declined to -4.8 million barrels on May 15 from previous 7.6 million. The weekly oil reports continue to show a decrease in inventories of crude oil stock which will ease fears of storage problems.

CURRENCIES

GBP/USD dropped to the session low of 1.2220 after UK CPI slowed to 0.8% in April 2020, from 1.5% in the previous month and slightly below market expectations of 0.9%. That was the lowest rate since August 2016.

GOLD

The yellow metal surged on Tuesday after US Treasury Secretary Steven Mnuchin warned that if coronavirus lockdown continued for months, then the US economy could face permanent damage.

Economic Outlook

On Tuesday Jerome Powell, Chairman of the Federal Reserve gave a lengthy online testimony before a Senate committee. He said that as the Fed balance sheet goes from $3.8 trillion in September to nearly $7 trillion now and higher in the future, he doesn’t see inflation or financial stability issues coming from the size of Fed holdings.

Moving ahead today, the important events to watch:

Canada core CPI – 12.30 GMT

US Crude Oil Inventories – 14.30 GMT

FOMC minutes – 18.00 GMT

Coronavirus Update:

Japanese Economy Minister Yasutoshi Nishimura said on Wednesday, the government will look at the coronavirus data up until this day before lifting the State of Emergency in the remaining prefectures. So far, more than 16,300 people have tested positive for the coronavirus in Japan and over 770 have died. Russia reported a further 8,764 coronavirus cases Wednesday, pushing its total case tally to 308,705. The death toll rose by 135 to a total 2,972 fatalities.

Technical Outlook

GOLD: The gold price momentum remained bullish from yesterday.

The important levels to watch for today: Support- $1735 and $1720 Resistance- $1760 and $1775.

EUR/USD: The pair currently trading above 1.0950 after the mixed Eurozone inflation report.

The important levels to watch for today: Support- 1.0910 and 1.0870 Resistance- 1.0980 and 1.1010.

Quote of the day: You learn nothing from trading if you think you are right all the time.

 

[JayJones]

Good it's about time we all got back to action. See the markets pump this week

I hope so for sure.

 

[syamfx2020]

Walmart (WMT) reported better than expected first-quarter earnings on Tuesday, as the coronavirus pandemic sends demand higher and driven by e-commerce sales growth and higher traffic in stores. The company said it would be withdrawing its 2020 guidance because of uncertainty during the coronavirus pandemic.

• Earnings per share (EPS) $1.18 vs. $1.12 expected
• Revenue $134.6 billion vs. $132.48 billion expected

Online sales jumped 74%, fuelled by a rush on canned foods, paper towels and other supplies as people sheltered in place.

“Our Omnichannel strategy, enabling customers to shop in seamless, flexible ways, is built for serving the needs of customers during this crisis and in the future,” Walmart CEO, Doug McMillon.

Wal-Mart said on last Tuesday that it would give another round of bonuses to its workers in the United States. The retailer said it had committed more than $935 million in bonuses for its workers so far this year. The bonus will be $300 for full-time hourly associates and $150 for part-time hourly and temporary associates.

Shares of Walmart gained 3.8% in premarket but later the stock closed 2.1% down.

 

[sebking1986]

Thanks for this. EURUSD has been testing the resistance levels all day but seems to be holding firm. Potential triple top formed for a drop next.

 

[syamfx2020]

The dollar index edged up slightly after the US Initial Jobless claims reported 2.438 million, the lowest level since the coronavirus crisis began and Philadelphia's Manufacturing index improved modestly to -43.1 in May from -56.6 in April.

 

[ScottHughes]

Looking for drops on EURUSD so dollar strength is welcome today

 

[syamfx2020]

The pair already dropped 50 pips so far, next support at 1.0920.