The virus confuses everyone

By 16/06/2020News
Morning Stock News

Gold   1693,50
(-1,80%)

EURUSD   1,0799
( -4,64%)

DJIA  24115
(-6,58%)

OIL.WTI  25,095
(-32,25%)

DAX   10609
(-12,16%)

The new trading week begins with news about the coronavirus. New outbreaks in China, as well as growing infection in the U.S. have a negative impact on market sentiment. Concerns about the second wave are very high.


EUR/USD

EURUSD

What are investors going to do next? So far we can see that the markets have been going down quite well over the last few weeks. We can consider that it was a necessary correction after a long rally. In summer, the volatility usually goes down. Traders go on vacation and have a rest. But it’s probably going to be a different summer. The S&P500 index is still above 3,000, which gives hope for growth. The DAX closed 0.3% below opening.


Euro

The Euro climbed high enough. The latest macroeconomic data shows that not everything is bad with the economy, but the local decline and slowdown of the economy is temporary. As soon as the situation with the pandemic is changed, production will recover quickly. EUR/USD has a wide enough range, in which it can stay for a long time. In the current situation, the correction to the level of 1.10 is more visible, from which there will be further growth.


Oil

The price of oil reacts very nervously to statements about multiple outbreaks of coronavirus in different countries. After six weeks of growth we should expect a correction. It is very likely that this correction will be fast and deep. On Monday the oil trades at $36.5 per barrel.


What’s waiting for us today?

05.00 Bank of Japan decision on interest rate
11.00 Business sentiment index of ZEW Institute for June.
14.30 Retail sales for May in the USA
16.00 Speech by Fed Chief Powell in Congress


Important Notes on This Publication:

The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 81% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.