Global Stocks Bounce back, Gold Shines through Chaos
Most Asian shares recovered during early trade despite Wall Street suffering heavy losses overnight. In Europe, stocks continue to march higher on positive global cues which could support Wall Street later in the afternoon.
The brutal selloff that engulfed global stocks this week took a pause on Friday as risk sentiment slightly improved across financial markets.
Most Asian shares recovered during early trade despite Wall Street suffering heavy losses overnight. In Europe, stocks continue to march higher on positive global cues which could support Wall Street later in the afternoon. Although positive trade data from China and reports of U.S. President Donald Trump meeting Chinese President Xi Jinping at the G20 summit next month has rekindled risk appetite, stock markets are not out of the woods yet.
Concerns revolving around escalating trade tensions, prospects of rising interest rates and global growth concerns remain a drag on global equity markets. With caution likely to heighten ahead of the earning’s seasons, the current stock market rebound could prove to be a mere dead-cat bounce.
Dollar Index wobbles above 95.00
It is thought-provoking how the Dollar has weakened to a monthly low against its major peers despite trade disputes and global growth fears promoting risk aversion.
President Trump’s repeated criticism of the Federal Reserve coupled with soft U.S. inflation data remains key drivers behind the Dollar’s depreciation. Although the Greenback still maintains its status as a safe-haven currency in times of uncertainty, further losses could be experienced in the short term. The potential downside is based on a technical breakdown below the 95.00 support level on the daily timeframe. A solid weekly close under this level has the potential to instill bears with enough confidence to attack 94.60 and 94.35, respectively.