How to start the week: analytics and forecasts — 03/08/2020

The climax of the reporting season has passed. IT pulled indexes up, but how long will the drivers last? Depends on the US Senate.

 

Economic calendar

14:00 UTC

The US manufacturing PMI for July is expected to be published. Growth is forecasted to 53.4 points. A reading below will put pressure on the USD.

Assets to trade: USD/CAD, NZD/USD, AUD/USD.

 

Important to know

The market is waiting for a new economic stimulus from the US Senate. Republicans have proposed $1 trillion in support, but Democrats want about $3 trillion.


The head of Hong Kong, Carrie Lam, plans to postpone the elections to the Legislative Council of the city, citing the risk of new outbreaks of COVID-19 diseases. Meanwhile, the pressure is mounting on Democratic candidates accused of violating Hong Kong’s new national security law.


Last week, the US published a preliminary estimate of the GDP growth rate for the II quarter. On an annualized basis, the decline was 32.9%. However, the site did not show a negative reaction.


Goldman Sachs admits that the US dollar will lose its position as a reserve currency. The key factor for this will be inflation, the growth of which is stimulated by the emission of money.


Representatives of Apple, Facebook, Google, and Amazon have spoken to the US Congress as part of an antitrust investigation. Their companies are accused of discouraging competition.

 

A fundamental view

Bitcoin

The Beijing Arbitration Commission believes that Bitcoin will not be completely banned in China. This is evidenced by a study by the organization, according to which bitcoin can be used as a digital product. But exchanging cryptocurrencies for fiat money is still illegal.

Against this background, Bitcoin exceeded the $11,000 price level for the first time in a year. And it is possible that the positive dynamics will continue.

USD/JPY

Not so long ago, Bank of Japan officials began to express concerns about the strengthening of the national currency. Indeed, the yen has renewed four-month highs against the US dollar. Against the background of the general overweight USD, traders can meet the Bank of Japan and start selling the yen.

Johnson & Johnson

The company announced the beginning of a clinical trial of a vaccine against COVID-19. Already in September, the next stage can start – the study of the late phase. Johnson & Johnson’s vaccine is one of 26 products that have entered clinical trials.

Nevertheless, the company’s shares have been declining intensely throughout the last week, but the situation may change dramatically against the background of the latest news.


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