Topsy-turvy evening in markets overnight with virus updates hitting risk sentiment. The S&P500 rallied to a five-month high before retracing and closing 0.9% lower, and the NASDAQ100 reached record high before retracing and closing -2.2% lower. Commodities, Brent crude futures came off 1.9% to $42.95, copper was up 1.1%, iron ore rose by 4.3% to $111.40 (the highest level since August 2019, helped by China’s economic recovery), and gold rose 0.3%
US Dollar Index finished 0.2% lower on the day.
EUR ranged between 1.1300 and 1.1375.
USD/JPY ranged between 106.80 and 107.32.
AUD initially traded from 0.6960 to 0.6993.
NZD similarly traded between 0.6555 and 0.6594.
AUD/NZD traded between 1.0595 and 1.0525.
- AUD/USD is closely correlated to the performance of US equities and is falling in tandem.
- US earnings and Aussie jobs market data will be key for AUD/USD.
AUD/USD, look for the pressure to remain to the downside for now with demand as we approach 0.6900 expected to slow any move while offering likely rest around the recent highs of 0.6990/.7000.
Event Risk Data Today
Australia: June Business Sentiment Survey and Weekly Payroll Data
New Zealand: June REINZ House Sales and Prices.
China: June Trade Balance, market expectations to be slightly down from $62.9bn to $57.4bn in June.
Europe: June ZEW Survey
Germany: June CPI.
UK: May average Earnings & Employment/May GDP & IP
US: June CPI. FOMC’s Brainard (04:00 AEST) and Bullard (04:30 AEST) will speak