American stocks are set to decline after the CDC confirmed coronavirus transmission in the US. The Dow and Nasdaq futures declined by 325 and 107 points respectively. This is the fifth day of straight declines in US stocks. Microsoft warned that it would miss its targets for the year. In Japan, many companies like Panasonic have asked their employees to work from home. As a result, there are high chances that the world will experience a recession this year.
The US dollar was unchanged in overnight trading as the market continued to worry about coronavirus. The market also reacted to positive data from the US. Numbers showed that new home sales rose by 764k in January. This was 7.9% higher than the previous 708k. This was the fastest growth rate in seven months. The number showed that the US economy was strong. We will receive the second reading of Q4 GDP data later today. We will also receive the durable goods orders numbers, corporate profits, jobless claims and personal expenditure data later today.
The New Zealand dollar declined slightly after the statistics office released relatively weak data. In January, the country exported goods worth more than $4.7 billion. This was lower than the $5.5 billion that was exported in December. The country imported goods worth more than $5 billion, which was lower than the previous $5.12 billion. This led to a $340 million trade deficit in the month. The consumer confidence declined to -19.4 in January. New Zealand is exposed to China’s weakness because it exports and imports most of its goods to the country.
The EUR/USD pair rose to an intraday high of 1.0913, which was the highest level since February 13. The pair has been on an upward trend since February 20. The price is above the 14-day and 28-day exponential moving averages. It is also above the support shown below in pink. The average directional index is above 25 while the momentum indicator is above 100. The pair will likely continue moving higher.
The XBR/USD pair dropped to an intraday low of 51.93. This is the lowest it has been since January 2019. The price is below the 14-day and 28-day exponential moving average while the RSI has dropped to the oversold level on the four-hour chart. The signal line of the MACD is below the centreline. The pair may continue to decline on coronavirus news.
The NZD/USD pair declined to an intraday low of 0.6282. This was the lowest level it has been since September last year. The pair is below the short and medium-term moving averages. The signal and histogram of the MACD have declined below the centreline. The Bears Power is below the centreline. The pair may continue to drop on negative news.