Here is what you need to know on Friday, June 26:
The market mood is mixed after a late rally in Wall Street allowed the dollar to recover despite a record number of coronavirus cases in the US and the Federal Reserve’s warning to lenders. A speech by the ECB’s Lagarde, several US figures, and COVID-19 statistics are eyed.
Coronavirus: Texas Governor Greg Abbott announced that further reopening of the local economy is halted as Intensive Care Units fill up. The Center for Disease Control reported a record number of infections and estimates that the total number of cases is probably around 23 million, ten times the current estimate.
President Donald Trump insisted that the US economy will roar forward and not shut down. He is facing an uphill reelection campaign, trailing in the polls against rival Joe Biden in all swing states.
The Federal Reserve has banned the largest banks from share buybacks in the third quarter and paying dividends in for the second one. The move is meant to keep resilient amid high economic uncertainty. The announcement somewhat weighed on sentiment.
US data: Durable Goods Orders beat expectations with an increase of 15.8% in May, while weekly jobless claims disappointed by staying near 1.5 million. Friday’s economic releases include Personal Spending, which is projected to bounce in May, and Personal Income, which carries expectations for a fall. The final Consumer Sentiment Index from the University of Michigan is also eyed.
See US Personal Income and Spending May Preview: Markets look ahead and behind
Gold prices are off their highs around $1,760 amid the more stable mood but could rise if investors are fearful again ahead of the weekend. Stocks may also fall back if investors fear COVID-19 figures continue rising while markets are closed.
EUR/USD is trading above 1.12 ahead of a speech by Christine Lagarde, President of the European Central Bank. She may discuss the current economic situation and the dealings with the German constitutional court. The ECB meeting minutes published on Thursday reiterated the bank’s willingness to act.
Brexit: Tensions remain elevated after David Frost, Chief UK Negotiator, accused the EU of the impasse in talks while his counterpart in Brussels Michel Barnier expected a breakthrough only in October. Face-to-face talks resume on Monday.
AUD/USD is consolidating below 0.68 as coronavirus cases are moving up in Australia. Prime Minister Scott Morrison described the increase is localized.
Oil prices are on the rise once again and helped the Canadian dollar stabilize.
Major cryptocurrencies have been holding their ground, with Bitcoin trading around $9,200. Action in altcoins is elevated.