Global Fundamental Analysis 27/04/2020

OPENING CALL: The Australian share market is expected to open higher. The SPI200 futures contract expected to open 82 points up.

 

The Federal Reserve said it was eliminating a rule that limits individuals’ withdrawals from savings accounts each month without paying a fee, in an effort to ease consumers’ access to cash.

 

The U.S. death toll from the coronavirus exceeds 50,000, accounting for more than a quarter of the world’s deaths.

 

Overnight Summary

 
 

EACH MARKET IN FOCUS

 

Australian Market

 

US Market

U.S. stocks climbed at the end of a week when shares were battered by a collapse in oil prices and fresh signs of a severe economic downturn.
Major indexes opened slightly higher, waffled between small gains and losses for much of the morning and gathered momentum in afternoon trading, closing near session highs.

The Dow Jones Industrial Average rose 260.01 points, or 1.1%, to 23775.27. The S&P 500 ticked up 38.94 points, or 1.4%, to 2836.74, and the tech-heavy Nasdaq Composite added 139.77 points, or 1.6%, to 8634.52.  All three indexes suffered losses for the week, reversing course after two consecutive weeks of eye-popping gains. The Dow fell 1.9% for the week, after its biggest two-week rally since the 1930s.

The economic toll of lockdowns imposed to stymie the coronavirus has become increasingly apparent, with jobless claims shooting higher in the U.S. and gauges of business activity sinking world-wide.

 

Commodities

Gold futures gave up earlier gains to finish lower, but posted their fourth weekly gain in five weeks as investors weighed demand for the haven metal against a backdrop of muted trading in U.S. government bond yields, a more stable consumer sentiment reading and mixed trading in the stock market.

Gold for June delivery on Comex fell by $9.80, or 0.6%, to settle at $1,735.60 an ounce. For the week, the yellow metal saw a roughly 2.2% gain, which marked its fourth
weekly rise in five weeks, according to FactSet data. Prices settled Thursday at their highest since April 14.

 

Oil Futures

U.S. benchmark oil prices ended 2.7% higher at $16.94 a barrel for a fourth straight increase on rising hopes that production is falling quickly and a coronavirus-driven drop in global demand is starting to be reversed.
Many analysts caution, however, that demand-destroying stay-at-home orders remain the norm, and warn oil storage is overflowing.

Despite the four-day streak of gains, prices ended the week 32% lower, the biggest weekly decline on record, due to Monday’s collapse in WTI to a negative price of $37.63 a barrel.

 

Forex

The U.S. dollar weakened 0.3% against the euro and 0.2% against the yen, and the WSJ Dollar Index fell slightly.
U.S. durable goods orders fell 14.4%, worse than expected and the biggest decline since 2014, while a measure of consumer sentiment fell sharply.
President Trump signs a $484 billion coronavirus relief package while the EU summit fails to work out details on the recovery fund.

 

European Markets

European sharemarkets closed weaker on Friday on disappointment about stimulus plans. Reuters reports: “Late on Thursday, EU leaders approved an immediate rescue package of about 500 billion euros but left the divisive details of a bigger fund until the summer.

They rallied around a larger common budget for 2021-27 with a recovery programme and tasked the European Commission to present detailed proposals by May 6. The panEuropean STOXX 600 fell by 1.1%. The German Dax index lost 1.7%. The UK FTSE index closed weaker by 1.3%. In London trade, shares of Rio Tinto fell by 0.9% and BHP shares closed lower by 1.3%.

 

Asian Markets




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