20th April 2020 Overnight Market Wrap

20th April 2020 Overnight Market Wrap

 Key Points

  • U.S. stocks and USD firmer on Friday
  • Drug manufacturer Gilead close to a potential Corona Virus treatment
  • U.S. Fed halves its bond buying program

Bias: Risk on

Commentary

The U.S. share market traded firmer on Friday, buoyed by a potential Corona Virus treatment from Gilead and by talk all over the globe and especially in the U.S. that economies are poised to reopen. European and American equities largely brushed off news of a contraction in the Chinese economy, being largely as expected. With no U.S. data overnight, markets were largely supported by health care stocks and news that Boeing would resume making aircraft.

The USD rose on Friday on news that the U.S. Fed was to half the daily bond buying program. Commodity currencies shadowed oil prices weaker, while the USD/CHF continued to grind lower. The JPY outperformed all currencies on a percentage basis.

Oil prices fell overnight, holding down at the low 18/bbl area with contract rolling and concerns about stockpile storage winning the day. Gold prices were weaker amid the firmer USD.
Bias

Expect a quiet start to the week, with a slight risk on bias after the firmer session in most markets on Friday. The USD should remain supported, but there is some position adjustment risk. Data today sees Japanese and Euro-zone Trade numbers.

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