Market Watch AU – 2nd February 2024
The AUDUSD was traded lower for the day, down to the lows of 0.65-cents before a turnaround in the US-dollar managed to return the Aussie pair back to 0.6570’s where it opens the Asia session today. The US-dollar fell as US Treasury yields sank, as concerns circulated about the health of the US banking sector once again, as well as a softer release on the weekly jobs data, that showed a higher than expected jobless claim of 224k. The UK Pound gained against the greenback after the BoE left their policy rates on hold, but opened the door to interest rate cuts. For our day ahead, the market will turn to local economic releases of Aust PPI Q4 and Home Loan Values for December, while more importantly for immediate direction, will be the release of the US Non-Farm Payrolls tonight. A higher read on the unemployment rate could add further pressure to the US-dollar and favour to the Aussie as an initial reaction. Day traders will watch for rallies to sell the fade in to 0.6600/25, while the bearish trend will have them monitor the support at 0.6500/10.
Wall Street stocks recovered over the opening session for the month as attention swings to the corporate earnings season after the US Fed cooled the prospect of an earlier rate cut in March. Amazon and Meta stocks rallied in after hours as their earnings beat and Meta announces its first ever dividend. The DJI was up +0.9% for the session, while the S&P500 was up +1.3%, and the Nasdaq was higher by +1.25% for the day. Australian shares are looking to trade higher today carrying over the Wall Street bounce as investors turn to the RBA meeting next week for further incite on interest rate directions.
Gold prices rose on a softer US-dollar and US Treasury yields as investors rejig their expectations for rate cuts to May, from March, after the Fed meeting yesterday. Investors look to the non-farm payrolls for next indications of direction to come.
Copper prices fell on the LME as traders digested the prospects of a US Fed rate cut being pushed out from the highly anticipated March tilt. Dalian Iron ore futures traded lower again, as traders continue to weigh up China demand as they tackle their property sector woes and further requirements for economic stimulus.
Brent Crude prices traded lower again , as cease fire negotiations between Israel and Hamas were quoted, only to be falsified later on. Brent has drifted below $80bbl losing 2% on the day.
Open today 0.65
Yesterday’s Range 0.6508 / 0.6579
Open today 0.61
Yesterday’s Range 0.6080 / 0.6143
Yesterday’s Range 1.0694 / 1.0743
Yesterday’s Range 0.6022 / 0.6083
Yesterday’s Range 4.6831 / 4.7275
Yesterday’s Range 0.5140 / 0.5185
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