investors assessed the potential terms of the next stimulus package and the
easing of coronavirus infections, while digesting the results of major US
companies. The Federal Reserve’s Chairman Jerome Powell also dominated the
attention of the markets.
In Europe, the
Stoxx Europe 600 index gained 0.5%, at the end of a session in which it
fluctuated between gains and losses. The German DAX index closed at the
waterline, the French CAC index lost 0.2% and the British FTSE 100 index rose
narratives of the U.S. Federal Reserve’s (Fed) Chairman after a rather
walkthrough-room meeting yesterday have not impressed the markets much. It was
too casual by pandemic time standards and prompted assets that had been rising
in price madly for several days in a row, like gold, silver or some currencies,
only to repeat their previous highs this time. That was followed by a slamming
wave of profit taking, which triggered some downside pullbacks. For example,
just a little bit below $1954/toz in gold spot contracts for now after testing
$1980/toz last night.
Futures for the U.S. Dollar Index (DXU0), which tracks the Greenback weighted
average position against a basket of six other currencies, are already four %
down since the beginning of July. Now they are located more than ten % lower
than its highest values in March, at the peak of the quarantine-related
safe-haven demand for the U.S. currency. After such a long trip, some currency
pairs may take a kind of time-out for the nearest couple of trading sessions,
ahead of the proposed announcement of the U.S.
prices have stabilised over the last week of July within the range of $43.2-44
per barrel of Brent crude. Oil prices are balanced by several counteractive
output is rising in countries that are not linked to the OPEC+ deal, namely the
United States. The number of oil rigs is rising in the U.S. for the first time
since March. According to the recent data published by Backer Hughes, crude
output rose by 0.1 million barrels per day to 11.1 million bpd. Rising
production curbs prices from a further climb.
emerged signs of U.S.
volatility in precious metals went into overdrive this morning as gold spot
contracts skyrocketed first to the short-lived stratospheric highs above
$1980/toz in early Asian hours and then nuzzled into the mud of a fleeting low
at $1907/toz in the European morning. Afterwards they managed to recover by $15
higher again in several minutes and touched $1935/toz before the noon. The
range of jumps reached as much as 15% for silver futures, which managed to draw
alternately $26.15 and $22.25, and $24 again on intraday charts.
banks keep the "money printers" running. the spot gold contracts
traded as high as $1,944 per troy ounce in early hours today. The yellow metal
prices have already surpassed the previous historical record set in September
2011, and the upward pressure is still not easing after the European noon.
Yen, another safe haven asset, which is suffering after huge amounts of
quantitative easing (QE), as everybody realises that it is just another name
for the "money printing press", has strengthened significantly over
the past couple of days against the Dollar.
Gold prices jumped brilliantly on Thursday trying to break through the $1900/toz psychological landmark. All precious metals, including platinum, silver and even palladium managed to show new highs of the year even before the downward spurt of a quick technical correction on U.S. stock indexes. Gold futures followed by the spot and CFD contracts continued to besiege the $1,900 fortress on Friday morning, probably forcing the market crowd to not collect their profits yet.
was mostly of risk aversion. The news that the United States Congress delayed
the presentation of a new stimulus package on the economy ended up motivating
this market sentiment.
tensions between the US and China have penalized Europe. The Stoxx Europe 600
index fell 0.9%, DAX fell 0.5%, CAC 40 lost 1.3% and FTSE 100 fell 1%. In the
United States, markets managed to resist losses and ended up closing the day in
the debt market fell again yesterday. The U.S.
Markets continue to react in a predominantly positive way to the information coming from news feeds using a clearly risk-on approach. Such a conclusion seems to be confirmed at the moment, not so much by some new summer records for the U.S. S&P500 broad market index, where the fresh upward movements are still accompanied by pullbacks almost every day, but more by the fact that safe-haven potential of the U.S. Dollar is seemingly being ignored.
For example, Pfizer and BioNTech yesterday announced a new agreement with the U.S. Government that already placed an initial $1.
the markets had a greater appetite for risk. European Union leaders have agreed
on a recovery plan. Good prospects for an Oxford vaccine are also enlivening
Europe 600 index rose 0.3%, after European officials reached a historic
agreement on the terms of the recovery plan. In the United States, the Dow
Jones appreciated 0.60% while the S&P500 grew 0.17% and the Nasdaq fall 0.81%.
Treasurys and European bonds showed a moderate reaction on Tuesday to the deal
on the European Union recovery fund.