• US Jobless Claims lowest since March
• US will maintain tariffs on European goods
• Poor oil demand forecasts
• Gold rises for 2nd day
• 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.
Economic calendar for Friday does not seem to be particularly interesting. GDP figures from the Eurozone will be the key release of the European session while US retail sales and industrial production data will be on watch during US trading hours. Apart from that, Michigan Consumer Sentiment index is expected to show a slight 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: xStation5
