Market Brief, Thursday, 3rd of September, 2020
The major US indices continued their rally which saw them extend their record highs from dovish rhetoric from FOMC members and optimism over a vaccine for Covid-19.
The major Asian equity markets followed suit taking from the strong session in the US with the ASX up 0.8% and the Nikkei up 1.1%. The Japanese index outperformed after Chief Cabinet Secretary Suga confirmed he will be running as party leader. China underperformed with the Hang Seng down 0.4% and the Shanghai Composite down 0.1% from a low liquidity effort.
The ECB’s top official's rhetoric has shifted saying that the EURUSD rate does matter as it will pressure exports and make way for further stimulus which caused an immediate reaction in the currency pair.
The dollar index found support following the dovish rhetoric from the Fed’s members and the ECB’s focus on the EURUSD rate. It is currently trading just under the 93 level with EURUSD trading around the 1.18 level and GBPUSD around the 1.33 level.
WTI and Brent both sold off despite a big drop in yesterday’s inventory report caused by hurricane Laura as there are concerns about demand. WTI is trading around 41.50 and Brent around 44.30.
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