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Stocks Rebound On Stimulus Hopes

Central Bank Governments
Central Bank Governments

Asian stocks managed to rebound today after yesterday’s sell-off as investors hope for a stimulus from governments and central banks. The yields on U.S. 10-year Treasury rise to 0.70% and crude oil prices rallied over 7%, offering hope that markets had found a floor, at least for now. The Australian government will soon announce measures to stimulate the battered economy by the effects of the coronavirus spread

Nikkei 225 index finished 0.85% higher at 19,867. The Shanghai Composite index closed 1.72% higher at 2993. The Singapore FTSE Straits Times is 2.30% higher at 2847. Hang Seng in Hong Kong was 1.91% higher at 25514. The ASX 200 index finished 3.11% higher at 5939. 

European indices started in positive territory the day. The German DAX is 2.47% higher at 10,885. CAC40 index is 2.59% higher at 4,835, while the FTSE MIB in Milan is 2.40% higher at 18,922. In London, the FTSE 100 is 2.58% higher at 6,125.  

XAUUSD Daily Chart
XAUUSD Daily Chart

In the commodities markets, the oil price rises sharply after the sell-off yesterday in one of the worse days for the black gold. WTI crude oil is 7.00% higher at $33.33 while the Brent oil is 10.04% higher at $36.78 per barrel. The gold price after a spike above the 1700 mark yesterday retreated and as of writing is 1.11% lower at 1661. The gold price’s first resistance seen at $1,703 the recent high, while the support stands at $1,584 the recent low. Silver price is 0.31% lower at $17.04. 

The correction in cryptocurrencies continues for one more day. Bitcoin (BTCUSD) is 0.27% lower at $7,914, hitting the daily low at $7,800 and the daily high at $7,955. Bitcoin’s technical outlook is bearish now as the cryptocurrency broke below the 100-day moving average. First support for BTCUSD stands now at $7,600 the recent low. On the flip side, the first resistance is seen at 9,123 Friday’s high and then at 10,495 the yearly top.

Ethereum is 1.27% lower at 200.09 with capitalization at 22.15 billion. The first resistance for Ethereum stands at $274.18, the February top while the first support stands at $194.64 today’s low. Ripple (XRPUSD) is 1.08 higher at 0.2073. Litecoin (LTCUSD) is 1.74% lower at 49.65. The crypto market capitalization stands now at $226.59 billion.

In the Lookout: Moody’s rating agency cut India’s 2020 growth forecast to 5.3% vs. 5.4% previously. 

China Producer Price Index (YoY) came in at -0.4% below the forecasts of -0.3% in February. China Consumer Price Index (YoY) came in at 5.2% in line with forecasts. 

People’s Bank of China has set the Yuan (USDCNY) reference rate at 6.9389 versus yesterday’s fix at 6.9260. 

Trading Perspective: In the foreign exchange markets, the AUDUSD is 0.21 lower at 0.6570. The U.S. dollar index is 0.70% higher at 95.83. NZDUSD trades 0.24% lower at 0.6321.

USDJPY Rebounds After Yesterday’s Sell-off 

USDJPY is 2.27% higher today as the US dollar recovers some of yesterday’s sharp losses. Investors shift aggressively to Japanese Yen as they are looking for cover to safe-haven assets amid the coronavirus impact and the sharp sell-off in crude oil. Today, investors’ sentiment improved amid speculation of further stimulus from the U.S.A. and Japan. 

On the technical side, the USDJPY momentum is bearish and lower levels might be on the cards. The first resistance for the pair stands at 105.20 the daily high. The next resistance level stands at 106.33 the high from March 6.

On the downside, immediate support for GBPUSD will be met at 104 round figure and more bids might emerge at 102 the daily low.  

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USDJPY Daily Chart
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