News

Dollar Holds Steady Supported by U.S./China Trade Tensions

USD

The dollar index which measures the greenback against a basket of major currencies finished higher as trade tensions supported the flow to the safe haven. DXY ended a four-day losing streak and closed higher at 94.70. The index fell for nine out of the past eleven trading days as the latest fundamental developments improved investor's risk appetite. However, President Trump is planning to take the trade dispute with China to a new level where he will impose tariffs on $200 billion worth of Chinese goods which would affect investor's risk appetite. Trump administration already imposed tariffs on $50 billion worth of goods and China responded with the same measures. The EURUSD traded at a three-day low of $1.1642. On the other hand, the dollar found support from the weakness of emerging market currencies. The USDTRY traded at a two-week high of 6.83.

Equities

Wall Street halted a four-day winning streak on Thursday, pressured by trade tensions. The Dow Jones Industrial Average fell by 0.5% to end below the 26000 level, at 25986. The SPX500 dropped 0.4% to settle at 2901, and the tech-heavy Nasdaq Composite retreated from a record high of 8133 to end lower at 8088. The global stock market remains vulnerable to developments regarding trade spats, as this matter has been a key market driver since early 2018.

Metals

Gold prices remain caught in a tight trading range awaiting major fundamentals. The gold ounce fell below the $1200 level for the first time in a week. However, the bullion found support at a low of $1197 and bounced up to trade at a high of $1207 ahead of the European trading session. On the other hand, the silver ounce reached a high of $14.68 earlier today, rising from yesterday's low of $14.50.

Oil

Oil prices closed higher for the second consecutive day, supported by the fears of supply disruption and the effect of the US sanctions on Iranian oil exports. The West Texas Intermediate crude futures settled at $70.02 per barrel, and the Brent futures closed higher at $77.48 per barrel. The U.S. energy services firm Baker Hughes will report the U.S. oil rig count later today.

Major Economic Events

GMT Country Event Expectation Previous
09:00 EU CPI (YoY) (Aug) 2.1% 2.1%
09:00 EU Core CPI (YoY) 1.1% 1.1%
09:00 EU Unemployment Rate (Jul) 8.2% 8.3%
14:00 US Michigan Consumer Sentiment (Aug) 95.5 95.3
17:00 US U.S. Baker Hughes Oil Rig Count   860

 
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