US stocks declined yesterday to end the worst-performing quarter ever. The Dow, Nasdaq, and S&P declined by about 1% as the markets worried about the impact of Coronavirus. In total, the three have dropped by more than 20% this year, with the Dow being the worst-performer. The index has been affected by the woes affecting Boeing, whose stock declined by more than 50% this year. It has also been hit by ExxonMobil and Chevron, two energy giants, that have dropped following the 50% fall in crude oil. All other companies in the index except Walmart, Intel, and Cisco dropped in March. Meanwhile, the market is concerned of the carnage brought by the disease. Yesterday, Donald Trump predicted that more than 100k Americans would die from the disease.
The Japanese yen wobbled after the country released weak economic data. The numbers from Tankan showed that the large manufacturer’s index declined to -8 in Q1 after rising by 5 in February. This happened as the number of Coronavirus cases in Japan started to rise. The country also postponed the Olympics to 2021. The small manufacturing index declined to a record -19 in the first quarter. Meanwhile, all small industry CAPEX declined by more than 11% while the outlook from big manufacturing companies declined by 11.
Today, the focus among investors will be on March PMI data, which will be released by Markit. The company will publish the PMI numbers from most countries. For example, the manufacturing PMI from Germany is expected to decline slightly from 45.7 to 45.5. In addition, today being the first Wednesday of the month, we will receive job numbers from ADP. Data from the company is expected to show that more than 150k jobs were lost in March. This will be a record high. Still, investors rarely focus on this number because it often differs from that published by the Labour Department.
EUR/USD
The EUR/USD pair was little changed in overnight trading as the market waited patiently for US jobs numbers and PMI data. The pair is trading at 1.1010, which is slightly higher than yesterday’s low of 1.0928. The pair also broke out below the important channel it was trading in while the price is slightly below the 23.6% Fibonacci Retracement level. The pair will likely see significant actions today, with the key levels to watch being 1.0927 and 1.1085.
AUS200
The AUS200 index edged upwards after Australia and China released better-than-expected PMI data. The index is trading at $5,261.8, which is higher than last month’s low of $4,041. The index is trading above the 14-day and 28-day exponential moving average while the RSI has been rising. Meanwhile, the signal line of the MACD is above the neutral level. This means that the index may continue rising in the coming days.
XAU/USD
The XAU/USD pair declined to a low of 1,568 as the market waited for employment data from the US. This was the lowest level since March 24. On the 30-minute chart, the pair is trading along the 38.2% Fibonacci Retracement level and slightly below the 14-day and 28-day exponential moving averages. The RSI is rising while the ATR is falling. This means that the pair could see significant moves later today.
