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Market News 【TOP 1 Morning】Two bad news surprise gold prices! U.S. stocks continue to hit new high

【TOP 1 Morning】Two bad news surprise gold prices! U.S. stocks continue to hit new high

The new crown epidemic in many countries in the world continues to worsen. OPEC+ will gradually increase oil supply in the summer. The two crude oil futures both closed down; the dollar rose slightly because inflation data stimulated bond yields; both the S&P 500 and the Dow hit record closing highs , The weekly line rose for the third consecutive week.

TOPONE Markets Analyst
2021-04-12
883

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Forex: USD rose slightly

U.S. dollar rose slightly against a basket of currencies on Friday, regaining some ground lost this week, as inflation indicators in the United States and China rose more than expected, pushing up bond yields.


The U.S. dollar index, which measures the U.S. dollar against a basket of six currencies, rose 0.10% to 92.163.


After hitting a two-month low in early London trading, the pound against the U.S. dollar reduced its losses during the day, with little change at the end of the session. The British pound against the euro is set to record its biggest weekly decline since September 2020, as it suffered a profit after its strong performance in the first quarter. The Australian dollar fell 0.9% at one point, and then the decline narrowed.


Simon Harvey, a foreign exchange analyst at the brokerage firm Monex Europe, said, “After a week of declines, we see the U.S. dollar consolidate across the board today, as inflation data released by China and the United States have brought the U.S. Treasury yield curve back to life.”


Gold: Gold price fell by more than 1%

Affected by the soaring US Treasury yields and the rebound of the US dollar, the price of gold fell by more than 1% on Friday, but the price of gold still managed to record its first weekly rise in three weeks.


Spot gold closed at US$1,743.88 per ounce, down US$11.96 or 0.68%. The highest intraday hit US$1,57.39 per ounce and the lowest US$1,730.97 per ounce. This week, spot gold closed up 14.57 US dollars or 0.84%.


COMEX June gold futures closed down 0.8%, at 1,744.80 US dollars per ounce, a cumulative increase of about 1.0% this week.


"Although in general, the gold market is bullish in the short term and is expected to exceed 1760-65 US dollars, the cautious attitude towards the new 10-year and 30-year (national debt) auctions and the CPI report next week will support the yield. As a result, the rise of gold is suppressed," said Tai Wong, BMO's head of base metals and precious metal derivatives trading. "Currently, yields are driving most markets, directly affecting the U.S. dollar and the stock market, and these three have different effects on gold."


The dollar and benchmark U.S. Treasury bond yields rebounded from two-week lows, reducing the attractiveness of gold.


Crude oil: crude oil futures closed down


The two major crude oil futures both closed down on Friday. As of press time, US WTI crude oil futures for May closed down 28 cents, or 0.47%, to $59.32 per barrel; Brent June crude oil futures closed down 28 cents, or 0.39%, to $62.95 per barrel.


Stephen Innes, chief global market strategist at Axi, said that as investors weigh these factors, oil prices are expected to trade in the $60-$70 range. The sudden calm in the oil market and the decline in volatility attracted passive investors because the monthly spread of the spot premium widened rapidly.


Energy Aspects analyst Virendra Chauhan said: "A large amount of destocking is underway to bring the market in the process of rebalancing." He added that the physical market still needs to rebound before oil prices and inter-month spreads can rebound.


US stocks: S&P and Dow hit new highs

The US stock market S&P 500 Index and the Dow Jones Industrial Index both set record closing highs on Friday. The weekly gains for the third consecutive week were partly due to the boost brought by growth stocks. The corporate quarterly earnings season will kick off next week.


The Dow Jones Industrial Average rose 297.03 points, or 0.89%, to 33,800.6 points; the S&P 500 index rose 31.63 points, or 0.77%, to 4,128.8 points; the Nasdaq index rose 70.88 points, or 0.51%, to 13,900.19 points.


This week, the S&P index rose 2.71%, the Dow rose 1.96%, and the Nasdaq index rose 3.12%.


Banking stocks will start next week for the first quarter earnings season. Goldman Sachs Group GS.N, JP Morgan Chase JPM.N and Wells Fargo Bank WFC.N will release earnings reports on Wednesday. According to Refinitiv IBES data, analysts expect the profits of S&P 500 index companies to increase by 25% over the same period last year, which will be the strongest first-quarter performance since 2018.


Today’s focus is on:

16:00 China's new RMB loans (March)

23:300 US consumer inflation expectations (March)



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