Trump eases over the trade deadline

Daily Analysis - 20/02/2019

US stocks lifted after Trump’s remarks

On Tuesday US stocks increased lightly following President Trump’s comments. He repeated once more that he will probably push back the important trade deadline. Equities also got support from the powerful quarterly numbers from Walmart. On Tuesday the U.S President stated that trade discussions with China are performing well, and he added that the deadline is not a "magical date." Both the U.S and China need to make a deal before the March deadline otherwise, additional U.S. taxes on Chinese goods may come into effect. On the other hand, Trump now is willing to push back the deadline. The S&P 500 advanced more than 0.10% to finish at 2,779.73 while the Dow Jones Industrial Average rose about 78.1 points before closing at 25,891.30. The NASDAQ Composite ended 0.2% higher at 7,486.77 while Netflix and the online retailer giant Amazon both grew more than 1%.

Asia stocks close higher

On Wednesday most of the main Asian stocks markets finished the day higher, following remarks from the U.S. President that suggested once more than a strictly guarded trade deadline in March may be pushed back. Mainland Chinese markets ended higher following a rocky session that marked a consolidation between positive and negative area. The Shanghai Composite increased around 0.2% and finished at 2,761.20 while the Shenzhen component climbed more than 0.3% to 8,473.40. The Shenzhen composite also raised about 0.3% to close at 1,448.22.

Oil near year’s top due to OPEC cuts

On Wednesday Oil marked near the 2019 tops, supported up by U.S. sanctions on Iran and Venezuela but also stock cuts directed by producer club OPEC. According to experts, rising U.S. production and fears over an economic slowdown are set to cap prices. International Brent crude futures were at $66.57 per barrel, higher about 13 cents from their last close while the U.S. West Texas Intermediate (WTI) crude oil futures scored a 2019 top of $56.38 per barrel on Wednesday, up about 30 cents, from their last settlement.

Near term sentiment for the two most popular pairs

Near term sentiment, for the two most popular pairs the EUR/USD and GBP/USD, are supporting the bulls for now. That fact helped us to recognize some additional weight on the greenback regardless. Another important driver for the pairs will be May's visit to Brussels later this evening. Now, on the other hand, the weakest performer of the day so far is the kiwi giving back some of its profits versus the greenback without much movement. For now, the Focus remains on US-China trade discussions.

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