Forex Today: Stocks Lower on Virus Fear

Adam Lemon

Risk sentiment takes a hit as coronavirus is seen to be making a new peak globally despite the vaccine.

 

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  • The strong rally in U.S. and Eurozone stock indices saw a strong bearish retracement yesterday. Asian markets are also mostly lower today, with the Japanese Nikkei 225 Index close to 2-month lows.
  • Bitcoin has failed to make a strong recovery from its recent dip and continues to trade below $57k.
  • The Forex market has seen the U.S. dollar bounce back yesterday as risk sentiment soured – typically, this also led to weakness in the Australian dollar. The Japanese yen is the strongest major currency.
  • New data shows that recent days have set a new record for the highest number of confirmed daily new coronavirus cases globally. The situation is especially bad in India, which is seeing explosive growth in infections and an exponential rise in case numbers to new highs, which is putting a severe strain on the Indian health care system. There are fears of mutations arising in India which would be resistant to current vaccines.
  • Global coronavirus deaths increased last week for the fifth week running after falling for months, signifying a rebound in the pandemic in areas where vaccinations are relatively absent.
  • Today will bring monthly policy input from the Bank of Canada, plus British and Canadian CPI (inflation) data releases.
  • Australian retail sales data came in stronger than expected, indicating a healthy economy, at a 1.4% annualized increase. New Zealand inflation data came in at an annualized rate of 0.8%.
  • Total confirmed new coronavirus cases worldwide stand at over 143.5 million with an average case fatality rate of 2.13%.
  • The fastest progression in terms of immunizing a population against the coronavirus in all but the smallest states has been in Israel, which has given at least one shot to 62% of its entire population followed by the U.K. at 49%. For most of the world, a vaccine remains distant. However, the pace of vaccination has finally begun to speed up in the European Union, which now has seven member states (Hungary, Finland, Estonia, Lithuania, Germany, Belgium, and Spain) having immunized more than 20%.
  • The rate of new coronavirus infections appears to now be increasing most quickly in Argentina, Cambodia, Canada, Colombia, Croatia, Cuba, Cyprus, Ecuador, Egypt, Georgia, Germany, Guatemala, Honduras, India, Iran, Iraq, Japan, Kazakhstan, South Korea, Lithuania, Malaysia, Mongolia, Nepal, Netherlands, Oman, Pakistan, Qatar, Saudi Arabia, Trinidad, Tunisia, Turkey, Venezuela, and Uzbekistan.
Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Learn more from Adam in his free lessons at FX Academy

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