By Deepta Bolaky
Stocks in the European and US session edged higher on promising vaccine updates and stimulus talks. Amid tougher lockdown restrictions in the US, a stopgap funding measure may be passed to avert a government shutdown. Majority of the major equity indices closed in positive territory while the FTSE index ended relatively flat driven mostly by the Brexit drama.
Source: Bloomberg Terminal
On Wall Street, technology stocks continued its rally pushing the Nasdaq Composite to a new fresh 2020:
In the FX space, major currencies were weaker against the US dollar. Major pairs are trading within familiar levels.
The British Pound remained among the worst G10 performers against the US dollar. The implied volatility in the Pound-dollar jumped to the highest since March as Brexit talks intensified ahead of the year-end deadline.
British Cabinet Minister announced an “agreement in principle” in a joint statement by the co-chairs of the EU-UK Joint Committee amid contradictory headlines:
“The parties have also reached an agreement in principle with respect to the decisions the Joint Committee has to take before 1 January 2021. In particular, this concerns the practical arrangements regarding the EU’s presence in Northern Ireland when UK authorities…”
The GBPUSD pair pared some gains and traded back above the 1.33 level.
On the economic front, GDP figures in the Eurozone and ZEW surveys in Germany came out mixed:
Germany – ZEW surveys
Despite the latest positive news ranging from vaccine updates to the OPEC compromise deal, tougher lockdown restrictions and surging coronavirus cases are weighing on the oil market. Crude oil prices struggled to edge higher on Tuesday but remained in familiar levels.
The API reported a draw in the weekly crude oil stock to 1.141M in December 4 from previous 4.146M. As of writing, WTI Crude oil (Nymex) and Brent Crude (ICE) were trading at around $45.47 and $48.84 respectively. Traders will likely be eyeing the EIA report and updates on the pandemic risks for fresh trading impetus.
The precious metal is holding up to recent gains lifted by encouraging stimulus talks, geopolitical tensions between the US and China and surging coronavirus cases. As of writing, the XAUUSD pair was trading around $1,869.
Source: GO MT4
By Deepta Bolaky
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|Thursday, 10 December 2020
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