Fed Chair in focus

September 22, 2020

A relatively quiet day for markets with a small amount of data scheduled for release.

Currencies were hammered overnight as uncertainty surrounding a virus vaccine saw traders flock to the USD. The EURUSD opened the week at $1.18411 and climbed to a high of $1.18706 early. The sell-off began shortly afterwards and continued into late trading, with the euro crashing to a low of $1.17307. It has come off those lows and is now trading at $1.17663. The GBPUSD followed the same pattern as the euro after opening at $1.29212. The pound edged up to highs of $1.29667 mid-session before falling over the next several hours to a low of $1.27737. It has regained some of those losses and is now trading at $1.28165.

Uncertainty wreaked havoc on indices, with the Dow and Dax both getting belted. The Dow began the week at 27,681.56 and ticked up to a high of 27,778.81 early. Things turned ugly from that point, with the Dow plummeting to lows of 26,702.43 late in the day. The dying hours of Monday saw a bounce back and that momentum has continued in early Tuesday trading, with the Dow now sitting at 27,208.30. The Dax had a forgettable start to the week when it opened at 13,144.00. The German index nudged up to a high of 13,150.71 early before the rot set in. A sell-off ensued and continued throughout most of the session, with the Dax tumbling to lows of 12,490.93. It has come off those lows and is now trading at 12,632.30.

The day ahead sees focus shift to the US and the testimony given by Fed Chair Jerome Powell. Jerome Powell is set to testify before the House Financial Services Committee regarding the CARES Act, which is the Coronavirus Aid, Relief and Economy Security package that the US government deployed at the height of the virus outbreak.

Other data published today includes:

China – CB Leading Index

Europe – Consumer Confidence

US – Existing Home Sales, Richmond Manufacturing Index

UK – CBI Industrial Order Expectations, BoE Governor Andrew Bailey speaks

 

Disclaimer: The information in this website is of a general nature only and the advice has been prepared without taking account of your objectives, financial situation or needs. Accordingly, before acting on the advice, you should consider the appropriateness of the advice having regard to your objectives, financial situation and needs. We recommend you seek independent advice if necessary.