US Greenback Might Resume Rise as Covid-19 Darkens Earnings Outlook

US DOLLAR, AUSTRALIAN DOLLAR, S&P 500, COVID-19, EARNINGS – TALKING POINTS:

• US Greenback broadly decrease as sentiment improves throughout world markets
• S&P 500 futures counsel a risk-on tilt will prevail within the hours forward
• Q1 earnings studies could bitter the temper with Covid-19 influence weighed

The safe-haven US Greenback traded broadly decrease in Asia Pacific commerce, retracing a number of the prior day’s outsized good points because the broader monetary markets digested after one other bout of liquidation. Commodity-linked currencies rose alongside different cyclical belongings, with the Australian Greenback main the way in which. The New Zealand Greenback was not far behind and the Canadian Greenback managed good points regardless of one other drop in crude oil costs.

The chipper temper has bled into pace-setting S&P 500 futures, which now level assertively greater to counsel {that a} risk-on tilt could persist within the hours forward. The financial calendar doesn’t appear to supply something potent sufficient to derail momentum. The earnings docket could stir volatility nonetheless, as Q1 studies from bellwether corporations like Delta Air Traces, CSX and Alcoa cross the wires.

The ahead steering on supply could also be of best curiosity as merchants attempt to set up a baseline for the severity of disruption attributable to the coronavirus outbreak. Explicit dour prognoses could additional amplify already swelling world recession fears, souring sentiment anew. With about 15 p.c of S&P 500 corporations having reported up to now, precise outcomes have trailed analysts’ forecasts by near 9 p.c.

USD, JPY DOWN WITH BONDS AS AUD AND NZD RISE WITH STOCKS

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— Written by Ilya Spivak, Forex Strategist for DailyFX.com

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