News

Europe Roundup: Euro plunges against dollar as China virus cases soar, European shares falter, Gold rises, Oil prices fall on bearish demand forecasts-February 13th,2020

Market Roundup

• French Unemployment Rate (Q4) 8.1%,8.5% forecast, 8.5%  previous

• German Jan CPI (MoM)  -0.6%,-0.6% forecast, -0.6% previous

• German Jan CPI (YoY)  1.7%,1.7% forecast, 1.7% previous

• German Jan HICP (MoM) -0.8%,-0.8% forecast, -0.8% previous

• German Jan HICP (YoY) 1.6%,1.6% forecast, 1.6% previous

• UK Feb Thomson Reuters IPSOS PCSI 51.6, 52.6 previous    

• Italy Feb Thomson Reuters IPSOS PCSI 38.40, 42.89 previous    

• Germany Feb Thomson Reuters IPSOS PCSI 54.27 , 53.60 previous  
 
• Russia Feb Thomon Reuters IPSOS PCSI 38.11, 37.90 previous

Looking Ahead – Economic Data (GMT)    

• Russia    Central Bank reserves (USD) 562.3B previous

• US Continuing Jobless Claims1,745K forecast, 1,751K previous

• US Jan Core CPI (MoM)  0.2%,0.1% previous

• US Jan Core CPI (YoY)  2.2% forecast,2.3% previous

• US Jan Core CPI Index 265.83 previous
    
• US Initial Jobless Claims  210K forecast, 202K previous

• US Jobless Claims 4-Week Avg 211.75K previous

• US Jan Real Earnings (MoM) 0.1% forecast, -0.1% previous
              
Looking Ahead – Events, Other Releases (GMT)    

• No significant events

Fxbeat

EUR/USD: The euro declined against the U.S. dollar on Thursday, as single currency under pressure   after a jump in coronavirus cases and deaths reported under a new diagnostic method in China hammered investors’ hopes that the outbreak might soon peak.The death toll from the outbreak in China had reached 1,367 as of the end of Wednesday, up 254 from the previous day. The euro dropped 0.41% against the greenback to $1.0855, the lowest level since May 2017. Immediate resistance can be seen at 1.0899 (5 DMA), an upside break can trigger rise towards 1.0955 (11 DMA).On the downside, immediate support is seen at 1.0851 (Lower BB), a break below could take the pair towards 1.0800 (Psychological level).

GBP/USD: The pound extended gains on Thursday after the resignation of British finance minister Sajid Javid, as investors bet that his replacement would pave the way for a more expansionary budget next month.Javid turned down the role of finance minister in Prime Minister Boris Johnson’s new cabinet as he was asked to replace all his advisers. The pound rose to Thursday's high of $1.3028, up 0.5% on the day. It also extended its rally against the euro, up 0.6% on the day to 83.37 pence  , its highest since Dec. 16. Immediate resistance can be seen at 1.2991 (11 DMA), an upside break can trigger rise towards 1.3037 (30 DMA).On the downside, immediate support is seen at 1.2898 (100 DMA), a break below could take the pair towards 1.2867 (Lower BB).

USD/CHF: The dollar was little changed against the Swiss franc on Thursday, as investors were cautious after a sharp jump in the death toll and infections from a coronavirus epidemic in China. Though broad risk-off sentiment was the main theme in London trading, traders were looking to take positions in riskier currencies as the jump in new cases was a result of a new approach in diagnosis, aimed at bringing forward the detection timeline and lowering the overall mortality rate. At (GMT 12:36), Greenback gained 0.3% versus the Swiss franc to 0.9772. Immediate resistance can be seen at 0.9795 (Higher BB), an upside break can trigger rise towards 0.9800 (Psychological level).On the downside, immediate support is seen at 0.9742 (9 DMA), a break below could take the pair towards 0.9709 (21 DMA).

USD/JPY: The dollar declined against the Japanese yen on Thursday, as yen gained as investors sought safe havens after China’s Hubei province, the epicentre of the coronavirus outbreak, reported a sharp increase in the number of new cases. Using a new method of diagnosis, the province reported on Thursday 14,840 new cases of the virus as of Feb. 12, up from 1,638 new cases on Tuesday. The number of deaths in the province rose by 242, a daily record, to 1,310. Strong resistance can be seen at 110.02 (7th Feb high), an upside break can trigger rise towards 110.58 (Higher BB).On the downside, immediate support is seen at 109.52 (21 DMA), a break below could take the pair towards 109.00 (Psychological level). 

Equities Recap

European shares pulled back from record highs on Thursday as a surge in new coronavirus cases in China surprised investors who were hoping that the outbreak had peaked.

At (GMT 12:50),UK's benchmark FTSE 100 was last trading lower at 1.68 percent, Germany's Dax was down by 0.64 percent, France’s CAC was down by 0.81 percent.

Commodities Recap

Gold prices rose on Thursday as investors sold equities and sought the safety of bullion after a sharp jump in the death toll and infections from a coronavirus epidemic in China.

Spot gold was up 0.4% at $1,571.23 per ounce by 0056 GMT. U.S. gold futures edged higher by 0.2% to $1,574.90.

Oil prices fell on Thursday after OPEC and IEA reports cut back demand forecasts for this year on the back of the coronavirus outbreak in China, the world’s biggest oil importer.

Brent crude   lost 65 cents to $55.14 a barrel by 0930 GMT while U.S. West Texas Intermediate (WTI)   was down 39 cents at $50.78.    

Treasuries Recap

JP: Japanese government bond (JGB) prices tracked losses in U.S. Treasury bonds lower on Thursday, shrugging off a fall in risk assets in response to a sharp rise in number of coronavirus cases. Benchmark 10-year JGB futures dropped 0.06 point to 152.55, with trading volume of 27,637 lots by late-afternoon trade. The 10-year cash JGB yield rose one basis point to minus 0.035%. The 20-year and the 30-year yields also gained one basis point each to 0.255% and 0.385%, respectively, while and the 40-year yield rose 1.5 basis points to 0.415%.

EUR: Italy led a rally in euro zone bond markets on Thursday, with 10-year Italian bond yields hitting four-month lows on growing confidence the ECB will keep monetary policy easy for longer to protect the economy from the fallout of coronavirus. Italy’s 10-year bond yield tumbled over six basis points to around 0.86%, narrowing the gap over safer German Bund yields to around 125 basis points — levels last seen in May 2018, just before a political crisis in Italy sparked a sharp sell off in its debt. Greece’s 10-year bond yield, which fell below 1% for the first time on Wednesday, extended falls to a fresh record low of 0.925%. Germany’s benchmark 10-year Bund yield was down 3 bps at -0.40%.
 


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