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Good news of the coronavirus vaccine

21 Jul, 2020

Market expects the fiscal stimulus of the US

Data and news released yesterday:

The coronavirus pneumonia was diagnosed in 3,956,463 cases on July 21st and 143,718 cases died. Compared with the data at 6:30 the previous day, 68,344 new confirmed cases and 485 new deaths were recorded in the United States.

In addition to accelerating the research and development of vaccines and treatments, we should also provide fair access to vaccines to people who may not be able to afford them.

Trump: the routine press conference on the coronavirus situation will be resumed in the afternoon of July 21, and the press conference will be used to convey "positive news" to the public, including progress in vaccines and treatment.

The U.S. stock market fluctuated. The market weighed the prospect of developing a  coronavirus vaccine and introducing more fiscal stimulus measures in the United States.

The coronavirus pneumonia vaccine research has made early positive progress in Pfizer Inc and German pharmaceutical companies.

The British Foreign Secretary Rabb announced in parliament yesterday that the British side would immediately and indefinitely suspend the extradition agreement with Hong Kong and prohibit the export of relevant weapons to Hong Kong.

The president of the European Commission, Frederick von der lain: European citizens have been waiting for a strong recovery plan. After four days of intense negotiations, it is time to seek a constructive compromise in the European Commission.

 

Market Volatility:

The U.S. dollar index fell 0.21% to 95.79, hitting a six-week lowest position earlier in the session. U.S. Treasury Secretary Mnuchin said on Monday, President Trump had agreed to an action to seek another $1 trillion economic assistance plan.

The euro rose 0.18% to close to 1.1448; in the early trading hours of Europe, the euro reached a four month high of about 1.1467 due to the expectation that EU leaders would start a meeting.

The GBP rose 0.74% to close to 1.2661; the market said that the portfolio funds had established a long position at 1.2641 with a target of 1.3100.

The USD/JPY rose 0.23% to around 107.27, rising to about 107.53 at one time. The Asian market analysis shows that importers have demand for the US dollar.

The spot gold rose to $1820.53 / ounce and broke the highest position record since September 2011, and silver rose by more than 3%, reaching a new highest position of $19.919/ ounce since September 2016.

The WTI August crude oil futures rose by 0.22 U.S. dollars, or 0.50%, at the settlement price of $40.81/ barrel; Brent September crude oil futures rose by $0.14, or 0.30%, to settle at 42.81 US dollars / barrel.

 

Future forecast of CWG:

In the Asian session of the trading day, Japan's national consumer price index was released in June, with the focus on the Australian Federal Reserve's monetary policy meeting minutes; the data in the European market session was light; and in the US session, Canada announced retail sales in May. In addition, the market should keep an eye on the outcome of the EU summit.

Institutional Analysis: UBS analysis said. The euro is likely to be boosted by the EU summit agreement and a weak dollar. As the economy rebounds from the trough, the euro will strengthen against the US dollar in the second half of the year; the recent general weakness of the US dollar will continue until the end of the year, and the demand for safe haven of the US dollar will continue to decline as the economy recovers. Moreover, the attractiveness of U.S. yields has been weakened by the Fed's interest rate cut, and the uncertainty of the US election could be negative for the dollar before the November election. The euro is expected to rise to 1.17 against the dollar by the end of the year.

 

Financial calendar:

Economic data:

07:30 national consumer price index of Japan in June

20: 30 may retail sales in Canada

At 02:30 the next day, New York crude oil was last traded in August futures exchange

at 04:30 the next day, API crude oil inventory from USA till July 17

Central Bank News:

09:30 minutes of monetary policy meeting released by RBA

10: 30 RBA Chairman John Lowe delivered a brief speech on "recent situation of Australia and global economy"

 

CWG financial knowledge:

Chicago Fed National Activity Index: Published by the Chicago Federal Reserve, the Chicago Federal Reserve National activity index is a national economic activity index which is weighted and averaged by 85 national economic activity indicators. If this value is 0, it means that the national economic expansion is the normal average over the years; if it is less than 0, it means that the economic expansion is lower than the average growth rate; if it is greater than 0, it means that the economic growth rate is greater than the average growth rate. If the published data is higher than expected, it will benefit the US dollar, otherwise it will be negative for the US dollar.