9th June 2020 - S&P 500 now trading back at January 2020 levels, and only 4.5% off the pre-pandemic


Market Headlines

Equity markets remained upbeat with the S&P500 up 1.2% to a fresh three-month high. Government stimulus and recovery expectations remain the main drivers of sentiment. Brent oil futures fell 3.5% to $40.80 after making a fresh three-month high, hurt by Saudi Arabia’s intention to cease production cuts from July, copper rose 1.1% to a three-month high, iron ore rose 5.1% to $105.65 – a 10-month high. US yields were relatively unchanged but selling in the USD continued with USD/JPY trading to a low of 108.23 and the push higher in the AUD/USD continuing to push higher above 0.7000.


Currencies

The US dollar index is off by 0.3%

EUR traded between 1.1270 and 1.1320.

USD/JPY falling from 109.60 to 108.24.

AUD ranged 0.6970 to 0.7022 – a fresh five-month high.

NZD went to a new four-month high at 0.6564.

AUD/NZD slipped further to 1.0681.


Commodities

Brent oil futures fell 3.5% to $40.80 coming off its three-month high, copper up 1.1% highest point in three-month, iron ore hits a 10-month high of $105.65 and gold was up 0.8%.


AUD Thoughts

June has seen a bounce in risk assets while risk assets with positive sentiment of economic reopening coupled with global policy easing. Markets will look to data released later in the week being US Claims and China Credit to gauge if optimism remains intact.


The AUD/USD, has continued to chew through any resting offers with the next level of selling interest expected toward 0.7080/0.7100, while demand between 0.6960/70 should slow any dip.


Event Risk Data Today

NZ: ANZ business confidence for June

Australia: May ANZ job ads are out as well as NAB business confidence survey.

Euro Area: The preliminary read of Q1 GDP expectations to be unchanged from the flash print

US: May NFIB small business optimism survey and JOLTS job openings


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