German, EU PMI, UK Retail Sales, AMEX Earnings

calendar 23/10/2020 - 09:05 UTC

After falling in overall value for the first three days of the week, the US dollar noticeably improved on Thursday, with the USDX rising towards the support level held up to ten days earlier.

The Turkish lira (TRY) significantly depreciated against other major currencies, reaching a new high in pairs like the USD/TRY and the EUR/TRY after the Turkish central bank left interest rates unchanged, whereas expectations were that another rate hike would follow the previous 200 bp rate increase as the runaway inflation is weighing on real yields.

While major equity market indices in Europe and the US managed to recover from the intraday low on Thursday, markets were mostly opening flat by Friday morning. One notable exception was the market in China (including Hong Kong), where major indices continued pushing higher with the China A50 index on track to close higher for the third day in a row and at an all-time high.

Bitcoin maintained its position at around the $13,000 mark, making a pause in its advances higher, while Ethereum continued catching up, rising towards a new 7-weeks high.

Relatively few fundamental releases are scheduled for Friday. These will include manufacturing and service sector PMI data from the Eurozone, US and Germany, as well as retail sales statistics from the United Kingdom.


As the US dollar continued to recover from its losses at the start of the week, the EUR/USD pair fell by Friday at times below the 1.18-threshold.

Fundamentals from the US were rather on the positive side, with existing home sales continuing to improve to 6.54 million homes sold in September, while initial jobless claims declined below 800 thousand.

The French Business Climate index was reported lower, only at a level of 93, while overall expectations were that it could remain around the previous reading of 96.

More data can be expected next week, including inflation figures from Germany, Italy and the United States.


Europe 50

European stock market indices seemed overall also track the sentiment seen in other equity markets and initially moved lower only to recover these intraday losses later and close with a small upside on Thursday. Still, it looks like the index will close lower for the second week in a row close to the support level that was in place for now for almost five months.

In this mixed market sentiment multiple car manufacturers’ stock such as Peugeot, Fiat Chrysler and BMW closed higher on Thursday

More earnings from European companies including Air Liquide, Daimler, Renault and Autoliv can be expected on Friday.

Europe 50


Oil prices rebounded, recovering a sizable part of the losses from the previous day and at times with the WTI crude oil contracts trading above $41 per barrel.

Some positive impact was seen according to analysts from the renewed hopes for a new stimulus deal and also improved fundamentals, such as initial jobless claims at just 787 thousand over the course of the past reporting week, which is the lowest level since the start of the pandemic in March.

On Friday the U.S. Baker Hughes Oil Rig Count will be presented. Last week the number of oil rigs in operation was for the first time in a quarter reported at above 200 after the figure stagnated around 180 in the months following the pandemic which saw the price of some oil contracts go below zero.


US 500

Overall market sentiment turned positive on Thursday, in part thanks to comments from the Speaker of the House of Representatives Nancy Pelosi, who said that a new stimulus deal was “just about there”.

Stocks of American Airlines moved higher on Thursday, despite the airline announcing a net loss of $2.4 billion and a revenue drop of 73 per cent compared to the same quarter last year. However, the adjusted earnings per share and the revenue at $3.17 billion were significantly better than anticipated.

On the other side of the spectrum, shares of the networking and enterprise software company Citrix tanked despite better than expected earnings at $1.38 per share (non-GAAP diluted). One issue was the slower than anticipated migration of users to cloud computing services of the company.

Intel was also under pressure after the results indicated a miss on earnings expectations as the company’s data centre segment disappointed compared to the client computing group segment, where earnings could have been driven by the increase in telecommuting due to the ongoing pandemic.

On Friday American Express publishes its quarterly results. Then next week on Monday earnings from Twilio and Alphabet can be expected.

US 500

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