US stocks pause as trade optimism ebbs

Dmitry Lukashov IFC Markets

Dollar strengthens despite falling construction spending

US stock market pulled back on Monday as optimism about possible US-China trade deal by the end of month receded. Washington delayed the raising of tariffs on $200 billion in Chinese goods initially set to increase to $25% from 10% on the March 2 deadline with reports indicating US and China were close to a deal which would end most US tariffs on imports from China in exchange for the latter following up on its own promises to allow in more US exports. The S&P 500 lost 0.4% to 2792.62. Dow Jones industrial dropped 0.8% to 25819.65. The Nasdaqcomposite slid 0.2% to 7577.57. The dollar strengthening continued despite data showing above expected 0.6% drop in construction spending in December: the live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, rose 0.2% to 96.636 and is higher currently. Futures on US stock indexes point to lower openings today.

SP500 tests resistance above MA(200) 03/05/2019 Market Overview IFC Markets chart

DAX 30 slips while other European indices rise

European stocks ended marginally higher on Monday. Both EUR/USD and GBP/USD continued falling with both pairs retreating currently. The Stoxx Europe 600 index added 0.2%. The DAX 30 however slid 0.1% to 11592.66 after 0.8% gain Friday, the biggest advance among European indices. France’s CAC 40 rose 0.4% and UK’s FTSE 100 gained 0.4% to 7134.39.

Shanghai Composite leads Asian indices

Asian stock indices are mixed today with traders impatient for more details on US-China trade talk progress amid reports a formal agreement could be reached at a summit between President Donald Trump and Chinese President Xi Jinping around March 27. Nikkei slid 0.4% to 21726.28 with yen resuming its slide against the dollar. Markets in China are higher as Chinese Premier Li Keqiang announced a growth target in a range of 6% to 6.5%, promising higher spending on technology development: the Shanghai Composite Index is up 0.9% and Hong Kong’s Hang Seng Index is 0.1% higher. Australia’s All Ordinaries Index fell 0.3% erasing most of previous session gain as the Reserve Bank of Australia kept its rate steady at 1.5%. The Australian dollar resumed sliding against the greenback.

Brent down

Brent futures prices are lower today while still supported by OPEC supply cuts. Prices inched higher yesterday: April Brent crude rose 0.9% to $65.67 a barrel on Monday.

Want to get more free analytics? Open Demo Account now to get daily news and analytical materials.

Author

Dmitry Lukashov

IFC Markets

Dimtry Lukashov is the senior analyst of IFC Markets. He started his professional career in the financial market as a trader interested in stocks and obligations.

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.