European markets have opened with a softer tone on Thursday. There are some nerves before the release of what are likely to be very high US weekly jobless claims.

The FTSE 100 is off some 200 points in early trade. Investors in the UK are waiting for an interest rate decision from the Bank of England and more stimulus measures from the Treasury.

US jobless insurance claims are expected to skyrocket this week. Many businesses will have had to make layoffs to survive the impact of travel restrictions and stay-at-home orders. The consensus estimates is for a whopping 1.5 million weekly jobless claims. If we see a number above 2 million, markets will start clamouring for the next government or central bank bailout.

Wall Street completed its first consecutive daily gain on Wednesday. It's a small bullish milestone for the new bear market. The approval and then passing of the US stimulus bill has been the main driver for optimism. The $2 trillion (9% of US GDP) plan has gotten investors' seal of approval.

The S&P 500 rose 1.15% having come off gains over 5% at the end of the session. The Senate has now passed the $2 trillion spending bill, and it will be sent to the House of Representatives for approval on Friday.

Today's jobless figures will give us a first taste of whether $2 trillion is even enough.

Investors' thirst for cash has been quenched for the time being so the dollar continues to head lower. The dollar will likely resume its uptrend if global markets start to sell off again.

News that Prince Charles had contracted COVID-19 might have contributed to the volatility in Sterling on Wednesday afternoon. Under a constitutional monarchy, the health of senior Royals adds an extra complication to Britain's fight against the coronavirus. The pound has been recovering from 3-decade lows. A united front from the Bank of England and UK Treasury will go some way to it holding onto the gains.

We're not looking for the Bank of England to cut interest rates below the new record 0.1%. Negative interest rates now would probably just smack of desperation. There's also a widespread view that the negative rates experiment in the Eurozone has failed. Some level of coordination with the UK Treasury is likely with Chancellor Rishi Sunak expected to announce plans to support the self-employed.

Having reclaimed $1600 per oz in a massive two-day rally, gold is back below that key level on Thursday. Oil continues to languish near its lows.


Opening calls

S&P 500 to open 42 points lower at 2433

This information has been prepared by London Capital Group Ltd (LCG). The material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. LCG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. Spread betting and CFD trading carry a high level of risk to your capital and can result in losses that exceed your initial deposit. They may not be suitable for everyone, so please ensure that you fully understand the risks involved.

Analysis feed

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Forex Analysis

Editors’ Picks

EUR/USD extends slump after NFP shows massive job loss

EUR/USD is trading below 1.08, down on the day. The Non-Farm Payrolls report has shown a loss of 701,000 jobs, worse than expected. The ISM Non-Manufacturing PMI surprised to the upside with 52.5 points. 


GBP/USD drops below 1.23 amid sour mood, after UK data

GBP/USD has dropped below 1.23 as the market mood sours. Final UK Services PMI dropped to 34.5 points, worse than expected.  


NFP Quick Analysis: 701K jobs lost only be tip of the iceberg, why King Dollar is ready for coronation

The US lost 701,000 jobs in March, the worst in 11 years. The Non-Farm Payrolls figures are lagging the fast-moving events. Wage growth is also skewed and should be ignored. The safe-haven dollar has room to rise. 

Read more

WTI trades in three-week’s highs near $26.50 a barrel

WTI is jumping from multi-year lows following the US President Trump’s tweet of yesterday (Thursday) suggesting a Saudi-Russian deal was on the pipeline.

Oil News

Gold remains confined in a range, moves little post-NFP

Gold extended its sideways consolidative price action around the $1615 region and had a rather muted reaction to the US monthly employment details

Gold News

Forex Majors