• US will maintain tariffs on European goods
• Poor oil demand forecasts
• Gold rises for 2nd day
European indices finished today's session lower amid concerns about a tariff dispute between the US and Europe. Washington announced it would maintain 15% tariffs on Airbus aircraft and 25% tariffs on other European goods including wine, whisky, olive oil and cheese. On the Brexit front, Britain’ negotiator David Frost said that an agreement between both sides on their future relationship could be reached as soon as September. Dax dropped 0.3%, CAC 40 lost 0.6 %and FTSE100 finished 1.55 %lower.
US indices are trading mixed. The Dow Jones dropped 0.10% weighed down by a 11.4% slump in Cisco Systems Inc (CSCO.US) after the company forecast first-quarter revenue and profit below estimates. Meanwhile S&P 500 is grinding towards its all-time high and Nasdaq rose 0.85%, with Apple (AAPL.US) on track to become the first company to attain a $2 trillion market cap. Investors also welcomed better than expected data from the labour market. Recent weekly jobless claims report showed that number of people filling for unemployment benefits dropped below 1 million for the first time since March.
However uncertainty over whether US lawmakers would reach an agreement on a new coronavirus aid package limited further gains.
President Trump accused congressional Democrats of not wanting to negotiate, while Republicans and Democrats exchanged accusations for refusing to compromise on key issues. At the same time, Fed official Rosengren warned that the US economic recovery will be slow if the pandemic is not contained. Meanwhile, some of the worst infected U.S. states showed signs of improvement, with Texas and California reported falling hospitalizations from the COVID-19.
Precious metals prices rose for the second consecutive session amid a lack of progress in negotiations on a new stimulus package which increased demand for safe haven assets. Gold added 0.7% and silver rose almost 5%.
WTI oil price fell over 1% per barrel and Brent lost 0.9%, after the IEA lowered its oil demand forecast for this year as the pandemic continues to negatively affect air travel. Meanwhile OPEC’s monthly report showed that global oil demand may decline by 9.06 million barrels per day this year, while previously analysts' expected 8.95 million bpd decline.
USDCAD is trading at its lowest level since January. Currency pair is currently testing the February 21 low at 1.32015. Should downbeat moods prevail, support at 1.3106 may come into play. However, if the market sentiment changes then local resistance is located at 1.3322. Source: xStation5The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
