Gold Drubbing, Opec+ Ecb Preview

 | Jun 04, 2020 10:45

  • Dow Jones jumps +500 pts after ADP (NASDAQ:ADP) jobs data impressed
  • Asian / European shares flat on Thursday
  • EUR/USD holds 1.12 before ECB Meeting
  • Oil prices slip (Brent
  • Gold notches biggest daily decline in a month
    • h2 INSPIRATION/h2

    “The market is a device for transferring money from the impatient to the patient.” - Warren Buffet

    h3 MARKETS/h3

    There’s a slight pause going into the ECB meeting. Stocks are taking a breather after another monster rally on Wall Street. It’s fair to say we’re looking a little exuberant with the Dow and S&P500 both up over 10% on the month.

    The euro is holding onto recent highs on the hopes the ECB re-ups its stimulus. Brent and WTI crude are lower on the possibility that the Russian-Saudi agreement on output cuts might not make it over the finishing line. Gold is a little higher having taking a drubbing amidst Wednesday’s unfettered optimism.

    h3 ECB Preview/h3

    Markets are interpreting Lagarde’s suggestion that the Eurozone economic contraction will be “between medium and severe scenarios” as ECB-speak for more bond-buying. Anything less than an extra 500 billion euros added to the PEPP could be a disappointment.

    So long as the ECB can uphold the perception that the policy toolbox isn't empty and the EU Recovery Fund remains on track then there's a lot to like about the euro.

    h3 Opening calls/h3

    S&P 500 to open 15 points lower at 3,107
    Dow Jones to open 113 points lower at 26,156

    h3 CHART/h3