Forex news from the European trading session - 11 May 2020
Headlines:
- China premier Li Keqiang: Will strive to achieve economic, social development targets
- German chancellor Merkel: Court ruling on ECB has 'great importance'
- South Korea delays reopening of schools by one week - report
- European equities see early gains wither, dollar firms
- Boris Johnson reportedly faces Cabinet backlash on latest coronavirus strategy
- SNB total sight deposits w.e. 8 May CHF 669.1 bn vs CHF 663.8 bn prior
- China April M2 money supply +11.1% vs +10.3% y/y expected
- UK's Raab: Changes to lockdown measures to take effect on Wednesday
- SNB announces expansion of its virus refinancing facility
- Lessons from the spanish flu
- ECB's Schnabel: We are fully committed to countering diverging spreads
- ECB's Schnabel: ECB stands ready to adjust size and duration of PEPP
- New Zealand to further ease coronavirus restrictions later this week
- Germany reports 357 new coronavirus cases, but infection rate a concern
- US to warn that China is working to steal American research on coronavirus vaccines
- Japan considers lifting the state of emergency in most prefectures this month
Markets:
- USD leads, NZD lags on the day
- European equities lower; E-minis down 0.8%
- US 10-year yields up by 0.6 bps to 0.689%
- Gold down 0.1% to $1,701.30
- WTI down 2.8% to $24.05
- Bitcoin down 10.4% to $8,963
There weren't much key headlines on the session but risk was a main mover as we saw sentiment sour during the session to start the new week.
European stocks started with mild gains but that quickly turned around as risk shifted to being more pessimistic, with US futures also turning around 0.5% gains to 0.8% losses now.
In turn, that kept a bid on the dollar on the session as the greenback rose across the board - even against the yen as well. USD/JPY worked its way from 106.90 to 107.30 levels.
Cable was a big mover - falling by over 100 pips to near 1.2300 - while AUD/USD erased gains on a rejection of its 100-day moving average again, declining from 0.6550 to 0.6470.
There aren't any big headlines driving the moves as developments over the weekend were mixed amid the UK and NZ easing lockdown restrictions, South Korea delaying the reopening of schools after a renewed spike in cases, and US-China tensions continuing to brew.
Elsewhere, Germany also saw a spike in its virus infection rate above the key threshold of 1.00 while Japan is looking to lift its state of emergency in most prefectures later this week.
In other markets, Bitcoin saw a massive decline over the weekend despite news of halving but is recouping losses to near $9,000 now.
Looking ahead, risk remains the key driver and perhaps investors still aren't too sure about running further upside at this stage amid ongoing concerns globally.
The key technical levels in the S&P 500 are ones to be mindful about this week in my view.
