U.S. stocks climbed after better-than-estimated jobs data indicated an economic rebound from the sharpest contraction on record. Treasuries and the dollar fell.
The S&P 500 extended its weekly gain as a government report showed payrolls rose by 4.8 million in June after an upwardly revised 2.7 million gain in the prior month. The unemployment rate fell to 11.1%. Economic-sensitive companies such as retailers and airlines jumped. Tesla Inc. surged after reporting deliveries that beat the average analyst estimate.
Stocks were slightly lower Tuesday morning, with the final session of the month and quarter under way.
The S&P 500 and Dow were on track to post gains of less than 1% for the month of June. The Nasdaq Composite outperformed amid a broad tech rally, with the index pacing toward a monthly advance of more than 4%.
But all three major indices headed toward double-digit percentage gains for the second quarter, following a surge off March's lows. The Nasdaq tracked toward a 28% second-quarter gain. The Dow and S&P 500 were set to post gains of more than 16% and 18%, respectively.
The USD/CAD pair refreshed daily tops during the early North American session, with bulls now eyeing a sustained move beyond the 1.3700 round-figure mark. The pair managed to reverse an early dip to the 1.3650-45 region and has now moved back into the positive territory. After spending a major part of Monday's trading session in the red, the US dollar staged a goodish intraday bounce and was seen as one of the key factors behind the USD/CAD pair's uptick of around 50 pips. Investors remain concerned a surge in the number of coronavirus cases could trigger renewed lockdown measures. This, in turn, dampened prospects for a sharp V-shaped global economic recovery and continued weighing on investors' sentiment. The prevalent cautious mood extended some support to the greenback's relative safe-haven status. The USD got an additional boost following the release of stronger-than-expected Pending Home Sales data, which surpassed even the most optimistic estimates and recorded a strong growth of 44.3% MoM in May.
Yesterday, USDCAD initially climbed from 1.3620 up to 1.3666 before falling back to 1.3609. The move lower quickly reversed with climb to 1.3670 – near 1 month highs before a late rally in equity markets sent USDCAD down to 1.3630. Overnight, equities and commodities were under pressure with flows benefitting the USD and JPY. The U.S. is reporting its highest daily average of Covid-19 cases and reports suggest that some states will be closing bars and restaurants. USDCAD has broken thorough the 1.3666 – 1.3686 resistance zone in place since June 1 which saw the USDCAD rate plunge from 1.3800 down to 1.3560. The high so far this morning has been 1.3715 with pull-back limited to 1.3693 thus far.
Stocks were mostly lower Thursday morning as investors digested a slew of new economic data reports, including new weekly jobless claims and May durable goods orders.
New unemployment claims came in at 1.48 million for the week ending June 20, marking the fourteenth straight week that claims held above one million. Consensus economists had expected new claims to total 1.32 million. Since mid-March, new jobless claims totaled more than 47 million.
The USD/CAD pair built on the previous day's modest recovery move from 1.5-week lows and gained some follow-through traction for the second consecutive session on Wednesday. The global risk sentiment took a turn for the worse and benefitted the US dollar's relative safe-haven assets. This coupled with a modest pullback in crude oil prices further undermined the commodity-linked currency, the loonie, and provided an additional boost to the pair. The pair was last seen trading near session tops, with bulls now eyeing a move beyond the 1.3600 round-figure mark. The mentioned level coincides with a short-term descending trend-line extending from last week's swing high, which if cleared might be seen as a fresh trigger for bulls.
Stock extended gains Tuesday morning, following global equities higher as hopes for a coronavirus vaccine rose and U.S.-China trade fears dissipated.
French drugmaker Sanofi (SNY, SNYNF) said on Tuesday that it anticipates it will receive approval for its potential Covid-19 vaccine it is creating with GlaxoSmithKline in the first half of 2021, which if successful would then be available in the second half of next year. While there are currently no vaccines to prevent the coronavirus, a host of pharmaceutical companies have entered the race to try and develop medicines to prevent and treat the virus.
Late Monday evening, stock futures declined sharply but then turned positive after White House trade adviser Peter Navarro said during a Fox News interview that any trade deal with China was "over," then walked back the remark.
The USD/CAD pair started the new week in a calm manner near 1.3600 but lost its traction during the European trading hours reaching a low of 1.3541 and it continued to drop to 1.3531 into the North American session. The USD is currently down 0.33% on the day. The lack of significant macroeconomic data releases on Monday seems to be forcing the US Dollar Index (DXY) to make a technical correction. The DXY rose for the second straight time last week and gained 0.59%. On Monday, the index is down 0.3% at 97.37, allowing the bearish momentum to remain intact. On the other hand, boosted by OPEC's pledge to improve compliance with output cuts, crude oil prices pushed higher with the barrel of WTI posting its highest weekly close in more than three months. At the moment, the WTI is trading just above $40, up around 1% on the day.
Yesterday, USDCAD initially dropped from 1.3580 down to 1.3522 before climbing to hold a 1.3590 – 1.3615 range for much of the NA session. The pairing has been anchored near 1.3550 – 1.3600 for much of the week after the initial move from 1.3686 down to 1.3505 at the start of the week. Equity markets were strong overnight while oil prices climbed over 3% to re-test the June high / high dating back to early March. That prompted USDCAD to decline from session highs at 1.3615 down to session lows at 1.3547. Over the past few hours, equity market gains have been halved while oil prices have also retreated after failing to break the June high @ $40.60. Fed stimulus measures / cheap money and surging Covid-19 cases in the U.S. (notably California, Arizona, Texas, and Florida) and South America continue to influence market direction. Canadian retail sales data was also worse than expected and USDCAD has since climbed back to 1.3594. The USD and JPY have been the best performing currencies since the NA open – both recovering overnight losses. The GBP is the worst performing currency having fallen to levels not seen since mid-March and October of 2019.
Applications for unemployment benefits in the U.S. fell less than forecast last week, showing only gradual improvement from the worst of the pandemic-related layoffs even as states re-open more of their economies.
Initial jobless claims for regular state programs totaled 1.51 million in the week ended June 13, down slightly from an upwardly revised 1.57 million in the prior week, Labor Department figures showed Thursday. The 58,000 weekly drop was the smallest since claims began to retreat in early April. The median estimate in a Bloomberg survey of economists called for 1.29 million initial claims in the latest week.
U.S. equities dropped as investors weighed the latest data and reports about fresh outbreaks of the coronavirus in China and America. Treasuries extended their advance.
The USD/CAD pair is trading in a relatively tight range on Wednesday and struggles to determine its next short-term direction. The data published by Statistics Canada showed on Wednesday that inflation in Canada, as measured by the Consumer Price Index (CPI), edged lower to -0.4% on a yearly basis in May from -0.2% in April. Moreover, the annual core CPI fell to 0.7% and missed the market expectation of 1.4%. Nevertheless, these figures had little to no impact on the CAD's performance. On the other hand, the US Census Bureau announced Housing Starts and Building Permits increased by 4.3% and 14.4%, respectively, in May. The US Dollar Index ignored this data and continues to post modest daily gains near 97.10. Later in the day, Jerome Powell, Chairman of the Federal Reserve System, will be testifying before the Senate on the second day of the semi-annual monetary policy report. Meanwhile, crude oil is also staying relatively quiet on Wednesday, failing to provide a directional clue to the commodity-related CAD. The US Energy Information Administration's weekly crude oil stock report could be the next catalyst for the WTI.
Stocks opened sharply higher Tuesday morning followed a report that the Trump administration was poised to unveil a $1 trillion proposal for U.S. infrastructure work, in a move to help boost the domestic economy. A record jump in retail sales in May also helped fuel the early rally.
The advance came after the Federal Reserve announced it was expanding its own stimulus program for the virus-stricken economy. The Fed said it would begin purchasing individual corporate bonds as part of its emergency lending program, expanding the Fed's previously announced Secondary Market Corporate Credit Facility, which had until Monday only included purchases of exchange-traded funds.
U.S. stocks began the week on a down note and Treasuries rallied on signs that a second wave of the pandemic is emerging. The dollar turned mixed against most other major currencies. The benchmark S&P 500 Index dropped as much as 2.5% before cutting the decline in half. Energy, financial and industrial stocks led the losses. Investors sought the safety of havens, pushing the yield on 10-year Treasuries down by two basis points. Oil futures slumped to around $35 a barrel in New York as BP Plc warned the pandemic will hurt long-term energy demand. After a fierce rally sent global equities close to their pre-pandemic levels, sentiment in markets has turned negative. Economic data across the board suggests that the global economy is still weak and there's no sign that international travel is returning to normal anytime soon. More than 20 U.S. states are seeing a pick-up in virus cases, and spreading cases in Beijing have also raised concern of a resurgence of the pandemic. In China, a string of top-tier data all showed that factory output, consumer spending and investment continued to improve in May, but there are few signs of a broad-based rebound needed to spur a V-shaped recovery. Despite the risk-off mood in markets, gold prices slumped, with prices approaching $1,700 an ounce in London.
After falling to fresh 3 month lows near 1.3320 after Wednesday's U.S. Fed interest rate policy announcement, massive risk aversion flows propelled USDCAD up to 1.3650 yesterday. The USD and JPY were broadly bid as the DJIA lost over 1,800 pts / 7% giving up the entirety of this month's gains in a single session. Oil prices also plunged 10% taking WTI crude to a 2 week low. Overnight, equities continued lower initially before broadly recovering. That sent the USD and JPY broadly lower. After hitting a two-week high of 1.3666, USDCAD dropped to 1.3527 during the London session. The pairing bounced to 1.3594 in early North American trade before falling back to 1.3540. North American equity indices are giving up some of the earlier gains and flows are benefitting the USD and JPY once again. USDCAD has since climbed back to 1.3600.
U.S. stocks tumbled the most in a month as the torrid surge in equities came to a screeching halt amid economic jitters. Treasuries rose.
The S&P 500 careened toward a third day of losses following one of the fastest rallies on record, with 480 shares dropping. Airlines, cruise operators and travel companies that surged in recent weeks bore the brunt of the selling. Energy, financial and industrial shares led declines on Thursday.
While much of the equity selling owed to the frantic pace of the recent rally, sentiment did sour as signs mounted that a possible second wave of the pandemic could be taking hold in some states. U.S. jobless claims remained high, underscoring the longer-term challenges caused by the pandemic. The report came out a day after the Federal Reserve provided a dour outlook for the economy.
The USD/CAD pair jumped around 65-70 pips during the early North American session and refreshed session tops, around the 1.3435-40 region in the last hour. The pair showed some resilience at lower levels and quickly reversed an early dip back closer to multi-month lows, around mid-1.3400s set earlier this week. The early downtick remained cushioned amid a weaker tone surrounding crude oil prices, which tend to undermine demand for the commodity-linked currency, the loonie. Bulls, however, seemed reluctant on the back of a sustained USD selling bias, which remained unabated following the release of softer-than-expected US consumer inflation figures for May. Meanwhile, the latest leg of a sudden spike could be solely attributed to some repositioning trade ahead of the FOMC. The Fed is scheduled to announce its monetary policy decision today at 10am and is widely expected to leave interest rates unchanged at the end of a two-day meeting. Hence, the key focus will be on the accompanying policy statement and the latest set of inflation/economic growth projections, so-called 'dot-plot'. This will be followed by the Fed Chair Jerome Powell's comments at the post-meeting press conference. Investors will closely scrutinize Powell's remarks for clues about the central bank's future policy path, which will drive the near-term sentiment surrounding the USD and provide a fresh directional impetus for the USD/CAD pair.
U.S. stocks and European equities slid on concern that the blistering rally in risk assets has overshot the economic recovery. Treasuries advanced with gold and the yen.
Declines in the U.S. market ran from oil drillers to cruise lines. The dollar rose against its major peers for the first time in nine days. Financial shares led losses in the Stoxx Europe 600 Index, while a gauge of European junk-grade credit risk increased the most since April.
After a record-breaking rally that added $21 trillion to global stock markets, valuations look now stretched and technical indicators suggest a pullback is overdue. The World Bank warned the economy will contract the most since World War II this year, reducing incomes and sending millions of people into poverty in emerging and developing nations.
U.S. stocks rose as easing lockdowns bolstered economic optimism. Oil slumped. The S&P 500 extended a rally from this year's low to more than 40% and is on track to erase this year's losses. The Dow Jones Industrial Average outpaced major benchmarks. Treasuries rebounded, while the dollar headed for its longest losing run in almost a decade. Traders were cautiously optimistic as many parts of the country came out of the shutdowns that brought the world's largest economy to a standstill. Stan Druckenmiller, who last month warned about owning stocks, said on Monday that he now believes he was "far too cautious" during the current market rally. To Citigroup's strategists including Tobias Levkovich, positioning may be overly extended, and investors may not be factoring all the potential risks. The dollar fell back to the level before the coronavirus crisis sparked a rush to haven assets. Where it goes from here mostly depends on the Federal Reserve, which will probably welcome all signs of recovery in its statement at the conclusion of this week's meeting. But policy makers may be wary of an unruly increase in borrowing costs that could add to strains on businesses and households, and raise the price tag of the government's rescue efforts.
Yesterday, USDCAD was flat trading within a 1.3468 – 1.3541 range. Overnight, positive risk sentiment continued sending the USD and JPY broadly lower – both currencies trading near 3 month lows vs the other majors. The AUDUSD rate climbed towards its 2020 high. USDCAD broke below its 200 day moving average @ 1.3463 – the first time the tech level has been broken since Feb. 21st. After the initial fall from 1.3800 this week, support just above this MA had stalled the down-trend the past few days. Both Canadian and U.S. jobs data were better than expected sending equity markets broadly higher as the market becomes ever more confident with the re-opening of the economy. The initial reaction sent USDCAD from 1.3440 down to 1.3394 before moving higher to 1.3465. A subsequent decline to 1.3391 was short-lived sending USDCAD back up to 1.3446. After falling towards a 3 month low, the broad USD index has climbed back to trade near session highs.
Stocks slumped in Europe and U.S. futures fell as concern a recent rally had gone too far too fast overshadowed new stimulus measures and encouraging economic data.
Contracts on the S&P 500 and Nasdaq 100 dropped, a day after the tech-heavy index rose briefly above its record-high close. The dollar edged higher as weekly jobless claims fell to 1.88 million, reflecting a slowing -- though far from a halt -- in job losses. The Stoxx 600 stayed lower in the wake of the European Central Bank decision to add 600 billion euros to its pandemic purchase program, more than expected, and extended it to at least June 2021.