Global stocks rise as US authorises new coronavirus treatment
Global stocks rose today as traders reacted to news that the US had authorised a new coronavirus therapy plasma treatment. In a letter on Sunday, the Food and Drug Administration (FDA) said that it was granting emergency approval for the treatment. This treatment entails using plasma from healed patients to treat hospitalised patients. Some of the country’s top physicists have warned that the procedure has not yet been proven on a large scale. In another statement, the Trump administration said that it will allow vaccines to start being administered in the next few months. In Europe, the DAX index, FTSE 100, CAC 40, and Stoxx 50 rose by more than 1%.
The New Zealand dollar was little changed today as traders reacted to the disappointing retail sales from the country. According to the statistics office, the country’s retail sales dropped by 14.6% in the second quarter after dropping by 1.2% in the first quarter. The core retail sales fell by 13.7% in the quarter. This decline was mostly because of the lockdown and the closure of non-essential businesses. All sectors of the retail sector except supermarkets saw weak sales during the quarter. The New Zealand dollar also reacted mildly to the lockdown extension in Auckland by four days.
The US dollar declined slightly as traders started to focus on the upcoming Jackson Hole summit. This is a summit where central bank officials meet to deliberate on the current economic conditions. Jerome Powell, the Fed chair will address the meeting on Thursday. Analysts expect him to press Washington to offer more stimulus to support the economy. The dollar is also reacting to the news about the coronavirus therapy and vaccine that the Trump administration is considering. At the same time, metals like copper, silver, and gold are up by more than 0.5%.
The EUR/USD pair rose by 0.4% today and is trading at 1.1840. The pair has gained in the past 9 consecutive hours. On the hourly chart, the price is above the 50-day and 100-day exponential moving averages. It is also above the dots of the Parabolic SAR while the RSI has moved closer to the overbought level. The price is also slightly above the 50% Fibonacci retracement level. Therefore, it seems like bulls are in control, which means that the price is likely to continue rising as bulls target the 38.2% retracement at 1.1868.
The NZD/USD pair rose to an intraday high of 0.6555. On the hourly chart, the price is above the important resistance level of 0.6547. It has also moved above the 50-day simple moving averages. It is slightly below the 100-day EMA. Also, the moving average convergence and divergence (MACD) indicator has moved above the neutral line. Therefore, by crossing the important resistance level at 0.6547, the pair is likely to continue rising as bulls aim for the next resistance at 0.6577.
The USD/CHF pair declined to an intraday low of 0.9088, which was the lowest level since Friday. On the hourly chart, the price is below the 38.2% Fibonacci retracement level. It is also below the lower side of the Bollinger Bands while the signal and main line of the MACD have moved below the neutral line. Therefore, the pair is likely to continue falling as bears target the next important support at 0.9060.