Equities
Asian stock
markets rose on Monday however, eyes are focused on the US presidential debate the
Coronavirus updates. The Covid-19 sharp rise worldwide and the restrictive
measures taken in the UK and elsewhere in Europe weighed significantly on the
global economic recovery hopes.
The house
speaker Nancy Pelosi was optimistic about agreeing on the relief package.
Democrats were asking for a $3.4 trillion deal, while Republicans offered only
$1.3 trillion. Both sides could meet halfway and agree on a $2.2 trillion
package.
Change % | |
+1.0% | |
+0.8% | |
+1.6% | |
+0.5% | |
-0.8% | |
+0.4% | |
-0.2% |
Currencies
The US dollar
rose against a basket of currencies and hit an over nine-week high at 94.78. The
main reason behind this rally was the risk-off sentiment in the market driven
by the surge of Coronavirus cases, as such some traders seemed to close their
short positions on the US dollar. The US Dollar index may continue its rally towards 95.50.
On the other
hand, the EUR/USD outlook remains negative while below 1.1713. A daily close below 1.1621 could send the
pair even lower towards 1.1459.
GBP/USD remained last week under pressure due to a strong US dollar and the
uncertainty of achieving a free trade deal. The EU/UK will resume negotiations
this week. The technical outlook of Cable remains negative while below 1.2773.
Commodities
The oil price
remained under pressure due to lower demand’s expectations and higher supply with
Libya rejoins market exporters and putting oil on track to end the month in the
red for the first time in six months. Brent oil provided last week a bearish signal
after closing below $42.50, therefore the technical outlook remains neutral and
a close below $39.60 changes the outlook to negative. On the Other hand, the US Crude could
fall towards $38.37 while the technical outlook changes to negative if closes
below $36.32.
Gold lost 4.5% of its value last week and closed below $1,861 changing the
technical outlook to negative, the precious metal could fall towards
$1,796.
Looking Ahead
Markets will tune
in the ECB president Lagarde’s speech on Monday at 5:45 PM (UAE time) and Fed
member Mester’s speech at 10:00 PM.