News & Analysis

Overnight on Wall Street: Tuesday 22 September 2020

September 22, 2020

By Deepta Bolaky
 @DeeptaGOMarkets

Equity Markets

Global equities fell on Monday – European stocks tanked and dropped the most in three months following the renewed fears of a second wave of coronavirus in the European Union and the United Kingdom. Major European stocks dropped by more than 3% yesterday.


Source: Bloomberg

Wall Street also struggled to edge higher following the broad-based selling off in the stock market. The US shares were further underpinned by the political risks ahead of the US election. The new disagreement is about the replacement of Ruth Bader Ginsburg as Democrats are arguing that justices should not be approved in an election year:

  • The Dow Jones Industrial Average erased 510 points or 1.8% to 27,148.
  • S&P 500 fell by 38 points or 1.2% to 3,281.
  • Nasdaq Composite dropped by 14 points or 0.1% to 10,779.

Currency Markets

In the FX space, major currencies were weaker than the US dollar. Amid the renewed concerns over the pandemic and the sell-off in the stock markets, the US dollar gathered strength on the back of its safe-haven status. Other safe-haven currencies like the Japanese Yen and Swiss franc held better against the greenback compared to commodity-related currencies.


Source: Bloomberg

On the economic front, it was a relatively muted calendar with central banks speeches and the Chicago Fed National Activity Index. The index shows slower but still above-average growth in August – the index declined to +0.79 in August from +2.54 in July.


Commodities

Crude oil prices were seen trading lower following the renewed strength in the US dollar. As of writing, WTI Crude oil (Nymex) and Brent Crude (ICE) were trading around $39.67 and $41.44 respectively. Given the ongoing uncertainty on the demand outlook and renewed fears about the pandemic, traders are to monitor the weekly oil reports for fresh trading impetus.

Gold

Despite the risk-off sentiment prevailing in the financial markets on Monday, the gold price which was finding support around familiar levels around $1,950 fell sharply. The XAUUSD pair dropped below the $1,920 level dragged by a stronger US dollar. As of writing, the pair is currently trading at $1,917.

By Deepta Bolaky
 @DeeptaGOMarkets

Key upcoming events

  • RBA’s Debelle Speech (Australia)
  • BoE’s Governor Bailey Speech and CBI Industrial Trends Survey – Orders (UK)
  • Existing Home Sales and Fed’s Chair Powell Speech (US)
  • Consumer Confidence (Eurozone)
Wednesday, 23 September 2020 
Indicative Index Dividends
Dividends are in Points
ASX200 WS30 US500 US2000 NDX100 CAC40 STOXX50
0 0 0.236 0.022 0 0 0
ESP35 ITA40 FTSE100 DAX30 HK50 JP225 INDIA50
0 0 0 0 0 0 0


Disclaimer:  The articles are from GO Markets analysts,  based on their independent analysis or personal experiences. Views or opinions or trading styles expressed are of their own;  should not be taken as either representative of or shared by GO Markets.  Advice (if any),  are of a ‘general’ nature and not based on your personal objectives, financial situation or needs.  You should therefore consider how appropriate the advice (if any) is to your objectives, financial situation and needs, before acting on the advice.  If the advice relates to acquiring a particular financial product, you should obtain and consider the Product Disclosure Statement (PDS) and Financial Services Guide (FSG) for that product before making any decisions.

Next:
Previous:

Let's Get Started with GO Open a Live Account Try a Free Demo