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EUR/USD Price and Gold Eye the Upcoming US Data

EUR/USD Price and Gold Eye the Upcoming US Data

Equities rally, Gold and oil stabilize, what moves markets today?

The Australian Manufacturing PMI final numbers for September of 55.4 came in lower than expected of 55.5. However, was far better than the prior print at 53.6. Nonetheless, the released data did not have any noticeable effect on the Australian Dollar against major currencies.

Equities

The US stock markets rallied on positive ADP numbers, the data came in stronger than expected however, the coronavirus surge weighed heavily on some sectors like aviation and entertainment as some US airlines prepare to layoff tens of thousands of workers unless they get federal aid.

The US fiscal stimulus deal remained in the negotiations stage as Democrats reduced their demands from $3.4trillion to $2.2 trillion, however, the US administration offer was below the $2.0 trillion thresholds and presented a new “generous” offer of $1.5 trillion with $20 billion extensions in aid for the airline's industry. The ball now is in Democrat’s court.

Europe has started to tighten measures to combat the Coronavirus resurgence. The Czech Republic issued a 30-day state emergency and the UK PM asked people to work from home and said he will not hesitate to impose new restrictions.

Stock Market

Change %

S&P 500

+0.7%

Dow Jones

+1.2%

NASDQ

+0.9%

Japan 225

-0.5%

DAX 30

-0.5%

FTSE 100

-0.5%

CAC 40

-0.4%

Currencies

The US Dollar index retreated further on Thursday eyeing a test of the inverted head and shoulders neckline located at 93.47. A daily close below that level could send the price even lower towards 92.73.

The EUR/USD bearish momentum has slowed down and rallied eyeing a test of 1.1909. That said, a daily close below 1.1713 could send the price even lower to re-test 1.1621. A better than expected non-farm payrolls data on Friday may send the pair even higher.

GBP/USD benefited from a weaker US dollar and rallied above 1.2773 hinting to test 1.3048. Nonetheless, markets pay attention to the EU/UK negotiation’s updates, as the hard Brexit risk is not reflected in the Sterling pound price. The UK has offered some concessions in the fisheries track and now it is up to the EU to decide if they are enough or not.

Commodities

Rising numbers of Coronavirus kept oil price fundamentals weak due to worries of lower fuel demand. The Brent oil remained below $42.50 and indicated a possible downward move towards $39.60, while the US Crude bears could press towards $38.37.

The gold steadied above $1,861 hinting towards $1,921. However, a close below $1,861 could send the precious metal towards $1,796.

Looking Ahead

Eyes will be on the US PCE index numbers with the initial jobless claims at 8:30 PM (GMT). At 9:30 PM comes the Canadian manufacturing PMI final read for September, and at 9:45 and 10:00 PM the US Markit and ISM manufacturing PMI data will be released. By 11:00 PM the Fed member Williams speaks.


This information/research prepared by Mahmoud Alkudsi does not take into account the specific investment objectives, financial situation or particular needs of any particular person. The research analyst primarily responsible for the content of this research report, in part or in whole, certifies that the views about the companies and their securities expressed in this report accurately reflect his/her personal views and consequently any person acting on it does so entirely at their own risk. The research provided does not constitute the views of JME Financial Services (Pty)Ltd nor is it an invitation to invest with JME Financial Services (Pty)Ltd. The research analyst also certifies that no part of his/her compensation was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report. As of the date the report is published, the research analyst and his/her spouse and/or relatives who are financially dependent on the research analyst, do not hold interests in the securities recommended in this report (“interest” includes direct or indirect ownership of securities). The research analyst in not employed by JME Financial Services (Pty)Ltd. You are encouraged to seek advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit that conforms to your specific investment objectives, financial situation or particular financial needs before making a commitment to invest. The laws of the Republic of South Africa shall govern any claim relating to or arising from the contents of the information/ research provided.