EUR/JPY jumps nearly 0.5% as stocks shrug off coronavirus concerns
- Asian stocks rise, pushing EUR/JPY and other yen crosses higher.
- Chinese stocks gain over 3% and the S&P 500 futures add 0.8%.
- Coronavirus cases in the US and across the globe continue to rise, posing risk to risk assets.
EUR/JPY is better bid at press time with stocks in Asia and the US index futures flashing green despite the rising number of coronavirus cases in the US and other parts of the world.
At press time, the pair is trading at 121.45, representing a 0.46% gain on the day, having put in a low of 120.78 during the early Asian trading hours.
Risk-on
The anti-risk yen is being offered across the board amid risk-on action in the Asian stocks. As of writing, China’s Shanghai Composite Index is up over 3% and stocks in Hong Kong and Japan are reporting a 2% and 1% gain, respectively. The futures tied to the S&P 500 are also reporting 0.83% gains.
Stocks are better bid despite reports of the second lockdown in Spain, a record single-day rise in the global coronavirus cases. In addition, the US, the world’s biggest economy, is getting isolated. “Covid19 not under control, reopenings paused or undone, increasingly barred from international travel,” popular analyst and fund manager Jeroen Blokland tweeted on Sunday.
What’s more, the Federal Reserve Bank of St. Louis’ Financial Stress Index has edged higher for the third straight week.
As such, a sudden reversal lower in the equity markets cannot be ruled out. In that case, the anti-risk yen will likely draw bids, sending EUR/JPY and other JPY crosses lower.
Technical levels
Author
Omkar Godbole
FXStreet Contributor
Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.
