Market wrap: US equities trade heavily, GBP/USD worst performer - Westpac

Ross J Burland FXStreet

In a market wrap, analysts at Westpac explained that after Asian equity markets mostly closed higher, sentiment soured in Europe. US bonds were closed for Veterans Day but equities were open and traded heavily, especially tech stocks.

Key Quotes:

"The main focus was concern over weaker demand for iPhones, with Apple sliding, though President Trump tweeted that, “The prospect of Presidential Harassment by the Dems is causing the Stock Market big headaches!”

EUR/USD was one of the worst performers, falling from 1.1325 to 1.1239 – a low since June 2017 – amid concerns the Italian budget impasse could escalate. Tensions remain into today’s deadline on responses to EU’s rejection of the initial budget proposals (not only for Italy) while the Italian government continues to hold staunchly to their proposals.

AUD/USD followed the broad USD moves, slipping from 0.7235 in the Sydney afternoon to 0.7190. NZD/USD was volatile but overall only slightly lower, around 0.6725. AUD/NZDthus fell further, from 1.0720 to 1.0677 – the lowest since June.

GBP/USD was the worst performer, falling from 1.2950 to 1.2828. There were further negative official and media comments over lack of potential for a breakthrough this week, amid increased political tension within May’s minority government. On a strong day for the US dollar, the safe-haven yen held its ground, net flat over the day at 113.80, though spent some time above 114."

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

EUR/USD flirts with weekly lows near 1.1770

EUR/USD now comes under further selling pressure, breaking below the 1.1800 support to challenge the area of weekly throughs near 1.1770 on Thursday. The pair’s decline comes in response to marked gains in the US Dollar amid steady geopolitical tensions. Ealier in the day, the ECB’s Lagarde delivered cautious remarks, although the currency remained apathetic.

GBP/USD threatens the 200-day SMA near 1.3440

GBP/USD rapidly leaves behind Wednesday’s strong advance, coming under heavy pressure and retesting the 1.3440 zone, where the critical 200-day SMA is located. Cable’s deep pullback follows the strong gains in the Greenback, while investors continue to pencil in a potential BoE rate cut in March.

Gold trims gains, slips back to around $5,170

Gold is now facing some downside pressure, hovering around the $5,170 region on Thursday. The yellow metal surrenders part of its earlier gains on the back of the resurgence of the buying interest in the Greenback. In the meantime, geopolitical tensions in the Middle East continue to limit the downside potential for now.