• Jump in Covid-19 infections in New York state
• US government is preparing further stimulus package
US indices are trading lower after a volatile start of today’s session. Initially market sentiment improved as the Chicago PMI and CB Consumer Confidence dropped less than expected in March. Investors also welcomed the news that the US government is preparing a fourth stimulus package to help the economy to recover and to stop the spread of the pandemic as the number of infections in the US increased to 175,000. Also Fed announced a temporary lending facility agreement for central banks, aiming to provide an alternative source of US dollars. However stocks fell as the number of new infections in New York state jumped 14% to 75.795. During today’s session Dow Jones dropped 0.55 % ; S&P 500 went down 0.66% and the Nasdaq is trading 0.18 % lower.
The US dollar traded higher today against most of the major currencies besides British pound which surged above $1.24, after falling in the morning due to concerns about the spread of the coronavirus. Fitch lowered UK’s sovereign debt as the amount of debt would increase amid efforts to combat the rapid spread of the pandemic while uncertainty surrounding trade negotiations with the European Union also poses risks.
Oil prices managed to rebound slightly, after US President Donald Trump and Russian President Vladimir Putin agreed to have their top energy officials discuss the current situation on oil markets. However oil prices are still trading under pressure as travel restrictions and city lockdowns around the world could last months and negatively affecting oil demand. US crude went up 0.14% while Brent fell 0.15%.
Market volatility is expected to continue as investors worry about how the coronavirus outbreak will stop and how bad the consequences will be while trying to assess if the stimulus measures announced will be enough to offset the economic impact of the pandemic.
ADP Non-Farm Employment Change and ISM Manufacturing PMI are the main data scheduled to be announced on Wednesday. Oil traders should pay attention to US Crude Oil Inventories numbers. Apart from that, German, Switzerland and Spain will release their Manufacturing PMI figures. Of course Markets’ focus still will be on coronavirus spread and response to it.
EUR/USD is accelerating the downside during today’s trading session. Euro was trading under heavy pressure and the currency pair tested 1.0930 support level. Later in the session Euro managed to rebound and currently EUR/USD is trading near the key support level at 1.10. 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.
