Market Update - 16th June 2020 - AUD Holds Grounds As Equities Bounce Back, Nuclear Is Having A Renaissance
AUD Consolidating:
The AUD has held its ground around 0.69 vs. the Greenback and has done similar across the board maintaining 0.54 vs the GBP and 0.60 vs. the EURO. What's even more impressive is it's done this despite a pretty severe equity sell off in the U.S on Friday night. I've suggested a few times over the past month or so that the AUD may well test 0.7000 in the short to medium term and it's looking more and more likely with restrictions slowly lifting across the country. Additionally interstate and some international travel may become a possibility in the not too distant future which will further support the economy.
Iron Ore Prices:
On top of that, Brazil is battling a large Covid19 pandemic and demand for Australian iron ore has increased along with the Iron Ore price with the shuttering of mines owned by Vale and others across Brazil. All of this suggests further bullish momentum for the AUD with the proviso that we don't see another cataclysmic meltdown in stock prices (which always remains a possibility).
Stocks Today:
In the U.S overnight stocks rallied, which sets us up for a better day on the ASX today - ASX Futures are set to open around 2.5% higher this morning.
Uranium - a sector I've had a close eye on over the past few years has performed well as a result of Covid19 mine closures and no demand destruction. Additionally Uranium & Nuclear Energy is encountering somewhat of a renaissance as policy makers (including AOC in the U.S) open the door to Nuclear Energy as a solution to carbon emissions. The price of uranium, which fuels nuclear reactors, is up over 35% this year and is the best performing commodity.
AUD EXCHANGE RATES:
AUD/USD – 0.6907
AUD/GBP – 0.5467
AUD/EUR – 0.6093
AUD/NZD – 1.0661
AUD/JPY – 74.206
OTHER MARKETS:
All Ords (XAO) – 5,873
Gold – A$2,490/oz
Silver – A$25.11/oz
Oil – US$37.46 barrel
DATA RELEASES TODAY:
GBP - Claimant Count Change at 4.00pm
USD - Core Retail Sales m/m at 10.30pm
USD - Fed Chair Powell Testifies at midnight
Senior FX Manager
Compass Markets
Contact Patrick for a quote on 0431 278 632.
*Above rates are indicative wholesale rates and intended as a guide only. Commentary above is my opinion and should not be construed as financial advice. I recommend you seek professional advice before doing anything of a financial nature.