Market Brief: Mideast Tensions Remain Key Focus
Fawad Razaqzada January 6, 2020 7:20 AM
A summary of news and snapshot of moves ahead of the US session.
- Market update at 12:07 GMT: In FX, GBP and EUR were the strongest while USD and AUD were the weakest among the majors; stocks were lower but off their worst levels; gold and silver were sharply higher, and crude oil was off its best level after gapping higher at the open.
- Today marks the start of the first full week of 2020, with more market participants coming back as the festive period ends. The new year has started with a bang in so far volatility is concerned. This is mainly due to the escalation of tensions between the US and Iran after Tump ordered the assassination of Iranian military commander Qasem Soleimani, who was killed by a drone strike in Iraq on Friday. Iran has promised "severe revenge" for the death of Soleimani and has already pulled back from the 2015 nuclear accord. The markets have reacted with crude oil spiking on concerns over further supply disruptions in the Middle East, while gold has soared past its 2019 high on raised safe-haven demand. Stocks have fallen sharply, although the downside has been limited due to expectations that the raised tensions will have minimal impact on global growth.
View our guide on how to interpret the FX Dashboard
- EUR higher as this morning’s Eurozone data surprised with the latest services PMIs and a survey of investor confidence topping expectations. Eurozone final services PMI came in at 52.8 vs. 52.4 expected and last. German PMI was revised nearly 1 whole point higher to 52.9, while flash PMIs form Italy and Spain both came in higher at 51.1 and 54.9. Sentix Investor Confidence printed 7.6 vs, 0.7 last and 3.0 expected.
- GBP rose as UK’s final services PMI came in at 50.0, one whole point better than the initial estimate of 49.0, which easily beat expectations of 49.1.
- Coming up:
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.