Global Fundamental Analysis 31/07/2020

Global Fundamental Analysis 31/07/2020, FP Markets

OPENING CALL: The Australian share market is to open lower. 

The Dow industrials and S&P 500 finished lower, but Nasdaq booked a Gain. The yield on the 10-year U.S. Treasury note settled at 0.540%, compared with 0.578% Wednesday. The WSJ Dollar Index was recently down 0.23% at 88.28. Crude-oil prices settled below $40 for the first time in three weeks. Gold prices marked their first loss in 10 sessions.

 

Overnight Summary

EACH MARKET IN FOCUS

Australian Market

Australia’s S&P/ASX 200 index closed 0.7% higher at 6051.1 as traders focused on the prospect of extended support from central banks rather than a record number of new local Covid-19 cases. Despite the announcement of 723 new cases, the benchmark S&P/ASX 200 held on to most of the gains made on momentum from the U.S.

US Market

U.S. stocks fell on one of the busiest days of the corporate earnings season, while new data laid bare the extent of the economic damage wrought by the coronavirus pandemic.

Major indexes opened sharply lower, and the Dow Jones Industrial Average fell nearly 550 points before paring its losses to trade down about 226 points, or 0.8%.

Commodities

Gold futures ended lower for the first time in 10 sessions, retreating from a record settlement just a day earlier.

August gold fell $11.10, or 0.6%, to settle at $1,942.30 an ounce. Prices for the contract settled at a record at $1,953.40 Wednesday.

Oil Futures

U.S. benchmark oil prices ended below $40 a barrel for the first time in at least three weeks.

September West Texas Intermediate oil declined by $1.35, or 3.3%, to settle at $39.92 a barrel on the New York Mercantile Exchange. That marked the first settlement below $40 for a front-month contract since July 9.

Forex

Major currencies were mixed against the US dollar in European and US trade. The Euro rose from lows near US$1.1718 to highs near US$1.1845 and was near US$1.1843 at the US close. The Aussie dollar fell from highs near US71.95 cents to lows near US71.22 cents and was near US71.83 cents at the US close. The Japanese yen rose from 105.26 yen per US dollar to near JPY104.69 at the US close.

European Markets

European sharemarkets fell sharply on Thursday with the pan-European STOXX 600 down by 2.2%. The German Dax index fell by 3.5% after Germany’s economy (GDP) contracted by 10.1% (survey:-9%) in the June quarter – the most since 1970. Shares of automakers Volkswagen (-6.1%) and Renault (-9.3%) fell after reporting the first half-year losses. The UK FTSE index fell 2.3% with Lloyds Bank shares down 7.6% after posting a pre-tax loss. In London trade, shares in Rio Tinto lost 2.6% and BHP shares fell by 2.5%.

Asian Markets

Earlier in the day in Asia, the Nikkei Stock Average reversed early gains to close 0.3% lower at 22339.23, weighed by utility and airline stocks.

Mainland China’s major stock market benchmarks reversed early gains to finish lower. The Shanghai Composite Index closed 0.2% lower at 3286.82, while the smaller Shenzhen Composite Index shed 0.4% and the ChiNext Price Index, an indicator for the performance of startups and emerging industries, lost the most, falling 0.9%.

  • Global Fundamental Analysis 31/07/2020, FP Markets
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