Forex Today: Stocks, gold to end Q2 on a high note, shrugging off reemerging COVID-19 cases


Here is what you need to know on Tuesday, June 30:

The second quarter, which has been seeing a substantial rebound in markets, is drawing to an end on a positive note, despite the resurgence of COVID-19 in the US and elsewhere. US consumer confidence, the Fed Chair's testimony, eurozone inflation, Canadian GDP, and coronavirus figures are eyed.

Risk on: US stock futures are pointing to gains and the US dollar is losing some ground on the last day of the second quarter. Investors are encouraged by official Chinese Purchasing Managers' Indexes which have exceeded expectations and topped 50 points in June – pointing to a rebound and future growth. 

One of the critical upside drivers has been central bank support. Jerome Powell, Chairman of the Federal Reserve, will testify alongside Treasury Secretary Steven Mnuchin. Powell's prepared remarks have been released and there he stresses that uncertainty is uncertain and hinges on the virus.

See Powell's Testimony Preview: Can he invigorate the risk trade?

While he is encouraged by the sooner-than-expected recovery, he stresses it will take time to return to pre-pandemic levels and pledged to support the economy. Mary Daly, his colleague from the San Francisco Fed, said she penciled in slow growth and amid high uncertainty.

Investors are somewhat encouraged by upbeat US Pending Home Sales, which leaped by 44.3% in May. Ahead of the testimony, the Conference Board's Consumer Confidence gauge for June is set to show another bounce. 

See Consumer Confidence Preivvew: Modest improvement coronavirus: Arizona and Los Angeles County have announced new restrictions as COVID-19 cases continue surging, especially in the Sun Belt. Some states are re-closing and others – as far as New Jersey which successfully depressed the disease – are halting the reopening. 

New York may delay indoor dining in a decision due out shortly. Monday's figures were marginally better than beforehand – perhaps due to the "weekend effect." New data will be closely watched.

Masks: Several states are demanding wearing face masks and Goldman Sachs says it could substitute lockdowns and boost Gross Domestic Product by as much as 5%. Vice President Mike Pence has been calling for wearing them while President Donald Trump has yet to do so. 

US politics: Trump is under scrutiny regarding his role around intelligence reports suggesting Russia paid mercenaries to kill US personnel in Afghanistan. The president is trailing rival Joe Biden by around 9% ahead of November's elections. 

Sino-American tensions: China has passed the controversial Hong Kong law, and set to become effective on Wednesday. Washington is considering imposing defense exports on the city-state. In the meantime, a new flu virus with "pandemic potential" has the potential to jump from pigs to humans. 

EUR/USD has been hovering around 1.12 as a turbulent quarter nears an end. Christine Lagarde, President of the European Central Bank, pledged to continue supporting the economy and called on governments to play their part. Preliminary inflation figures for June are set to show an increase, following upbeat statistics from Germany and Spain.

See Eurozone Inflation Preview: EUR/USD has room to rise if Core CPI tops 1% amid positive bias

GBP/USD has been struggling below 1.23 as the UK is set to reimpose Leicester, a mid-sized city, under lockdown following a breakout of COVID-19. Final GDP figures for the first quarter have shown a drop of 2.2% in output, worse than initially estimated and that is also weighing on sterling. The rest of the nation is on course to continue its gradual reopening. Brexit talks resumed on Monday, this time face-to-face, and a breakthrough is still awaited.

Prime Minister Boris Johnson is scheduled to deliver a speech later on Tuesday, laying out plans for infrastructure spending and other expenditure worth around £5 billion. Skeptics say some of the details have already been published. 

AUD/USD is attempting to recover despite an increase in coronavirus cases in the land down under. Queensland is set to keep its border with Victoria closed as the southern states are also set to slap a lockdown on parts of Melbourne. Australia's reopening plans are in doubt. 

USD/CAD is trading below 1.37 as oil prices are consolidating their gains, with WTI hovering just below $40. ahead of Canada's GDP  figures for April, the first look into the second quarter, which is forecast to show a double-digit plunge. 

Gold prices are on course to close the quarter with the strongest increase in years, hovering around $1,770. Central bank support may continue pushing it higher.

See Gold, silver & crude oil price forecast [Video]

Cryptocurrencies have stabilized with Bitcoin clinging to the $9,100 level.

End-of-quarter flows may trigger elevated volatility later on Tuesday. 

More Why the dollar is king in the US coronavirus comeback? Discover what to watch out for!

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

FXStreet Trading Signals now available!

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

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD bounces after upbeat COVID-19 cure news

EUR/USD is trading above 1.13, rebounding from the lows. Gilead reported that its drug Remdesevir substantially reduces mortality among COVID-19 patients. The news boosted stocks and weighed on the dollar. US coronavirus statistics are due out.

EUR/USD News

GBP/USD recaptures 1.26 as the market mood improves

GBP/USD is trading above 1.26 as the market mood improves and the safe-haven dollar retreats. Investors are shrugging off Brexit concerns and focusing on hopes to cure coronavirus. US COVID-19 statistics are due out.

GBP/USD News

XAU/USD consolidates daily gains above $1,800

After advancing to its highest level since September of 2011 at $1,818 on Wednesday, the XAU/USD pair staged a correction and briefly dropped below $1,800 on Thursday.

Gold News

Cryptocurrencies: War for dominance hit the bedrock of the market

Bitcoin tried to regain market share and activated sales in the Altcoin segment. BTC/USD, ETH/USD and XRP/USD are looking for supports and a rebound to push them to new elative highs. The current compression on the XRP/USD chart could trigger an exploding movement.

Read more

WTI once again breaks $40 per barrel after trading lower in early EU trade

There has been quite the bounce in WTI since the EU session after some strong selling pressure during Thursday and overnight. Once again on Friday's session, the price has taken the USD 40 per barrel handle. 

Oil News

Forex MAJORS

Cryptocurrencies

Signatures