News

America’s Roundup: U.S. dollar reaches six-week high on weaker euro, Swiss franc and yen, Wall Street gains, Silver scales 8-year peak, Oil settles up more than 2% as U.S. inventories fall-February 2nd,2021

Market Roundup

• French 12-Month BTF Auction -0.642%,0.621% previous

• French 3-Month BTF Auction -0.631%,-0.624% previous

• French 6-Month BTF Auction -0.627%, -0.624% previous

• Canada Jan Manufacturing PMI 54.4,57.9 previous

• US Jan Manufacturing PMI 59.2, 59.1 previous

• US Jan ISM Manufacturing Prices 82.1 , 77.0 forecast, 77.6 previous

• US Jan ISM Manufacturing Employment 52.6, 51.7 previous

• US Jan ISM Manufacturing PMI 58.7, 60.0 forecast, 60.5 previous

• US Dec Construction Spending (MoM) 1.0%, 0.9% forecast, 0.9% previous

• US Jan ISM Manufacturing New Orders Index 61.1, 67.5 previous

• US 3-Month Bill Auction 0.065%,0 .080% previous

• US 6-Month Bill Auction 0.070% , 0.085% previous

Looking Ahead – Economic (GMT)

• 23:50 Japan Monetary Base (YoY) 18.3% previous

•03:30 Australia Jan RBA Interest Rate Decision

Looking Ahead – Economic events and other releases (GMT)

•01:30 Australia RBA Governor Lowe Speaks

•03:30 Australia RBA Rate Statement

Fx Beat

EUR/USD: The euro weakened against dollar on Monday as soft German retail sales data weighed on euro. German retail sales plunged more than expected in December as a decision to tighten lockdowns to curb the spread of COVID-19 choked consumer spending in Europe’s largest economy at the end of the year, data showed on Monday. The Federal Statistics Office said retail sales fell by an unprecedented 9.6% on the month in real terms after a downwardly revised increase of 1.1% in November. Immediate resistance can be seen at 1.2116 (5 EMA), an upside break can trigger rise towards 1.2204 (23.6%fib).On the downside, immediate support is seen at 1.2059 (38.2%fib), a break below could take the pair towards 1.2000 (Psychological level).

GBP/USD: Sterling declined on Monday as dollar gained amid views that the United States has an advantage in growing its economy and vaccinating its population against COVID-19. The moves came on evidence pointing toward a stronger recovery from the coronavirus pandemic for the United States than for other countries. The dollar’s gains on Monday came as crude oil and silver, both dollar-denominated commodities, rose 2% and 7%, respectively. Immediate resistance can be seen at 1.3758 (23.6%fib), an upside break can trigger rise towards 1.3800 (Psychological level).On the downside, immediate support is seen at 1.3644 (38.2%fib), a break below could take the pair towards 1.3600(Psychological level).

USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Monday as the greenback broadly climbed, with the currency giving back some gains it made after stronger than expected GDP data on Friday. The U.S. dollar rose against a basket of major currencies, bolstered by pressure on the Swiss franc , which fell out of recent trading ranges against the greenback. The price of oil, one of Canada’s major exports, was buoyed by falling inventories and hopes of a swifter global economic recovery, although halting vaccine rollouts and renewed travel restrictions capped gains. U.S. crude prices were up 1.1% at $52.76 a barrel. Immediate resistance can be seen at 1.2872(23.6%fib), an upside break can trigger rise towards 1.2954 (21st Dec high).On the downside, immediate support is seen at 1.2820(38.2%fib), a break below could take the pair towards 1.2775 (50%fib).

USD/JPY: The dollar strengthened against the Japanese yen on Monday, on the view that the United States has an advantage in growing its economy and vaccinating its population against COVID-19.On the data front, U.S. manufacturing activity slowed slightly in January, with the Institute for Supply Management (ISM) reporting its manufacturing sector activity index fell to a reading of 58.7 from 60.5 in December. ISM’s measure of prices paid by factories for raw materials and other inputs jumped to its highest level in nearly 10 years, strengthening expectations inflation will perk up this year. Strong resistance can be seen at 104.95 (38.2%fib), an upside break can trigger rise towards 105.41 (23.6%fib).On the downside, immediate support is seen at 104.56 (50%fib), a break below could take the pair towards 104.49 (5 EMA).

Equities Recap

European shares jumped on Monday, bouncing from their worst weekly decline since October powered by a rise in shares of miners after an ongoing retail frenzy shifted its attention to silver.

UK’s benchmark FTSE 100 closed up by 0.92 percent, Germany’s Dax ended up by 1.41 percent, France’s CAC finished the day up by 1.16 percent.

Wall Street’s main indexes climbed on Monday following a steep sell-off last week, as a shift in the retail trading frenzy to silver drove up mining stocks and investors monitored progress in talks over economic stimulus.

Dow Jones ended up by 0.76 percent, S&P 500 closed up by 1.61 percent, Nasdaq settled up by 2.55 percent.

Treasuries Recap

U.S. Treasury yields slipped on Monday, pushed down by expectations of lower borrowing to fund economic stimulus measures and data that showed factory activity slowed last month.

The benchmark 10-year yield was last down 2.5 basis points at 1.0689%.

Commodities Recap

Silver stretched its rally to a third session on Monday, jumping as much as 11.2% to a near eight-year high as retail investors switched focus to the metal from GameStop Corp and other stocks hyped up in social media.

As of 2:27 p.m. EST (1927 GMT), spot silver was up 6.6% at $28.78 an ounce, easing back slightly after hitting its highest since February 2013 at $30.03.

Oil prices settled more than 2% higher on Monday, buoyed by falling U.S. crude inventories and rising winter fuel demand due to one of the worst snowstorms to hit the U.S. Northeast in years.

Brent crude settled up $1.31 cents, or 2.4%, at $56.35 a barrel. U.S. crude gained $1.35 cents, or 2.6%, to settle at $53.55. Both benchmarks gained nearly 8% in January.


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