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ICM: Dollar Extends Gains amid Rising European Risk

ICM Capital

ICM, the leading London-based FX and CFDs provider, reported that the dollar advanced against major peers on Thursday, supported by the rising risks from Italy's budget and a Brexit deal. Wall Street finished sharply lower on global growth concerns.

The dollar index which measures the greenback against a basket of major currencies closed higher for the third consecutive day. DXY settled near a two-month high at 95.99.

The Euro tumbled to a ten-day low against the United States dollar following the comments of the European Commission concerning the Italian budget draft. The Commission said that the planned government spending was too high, the deficit would rise, and the public debt would not be in line with the European Union rules. The Italian 10-year bond yields rose to 3.74% the highest since 2014, and the gap between the German and Italian 10-year bond yields widened to the largest in more than five years. As per ICM trading platform, the EURUSD traded at a low of $1.1449, and the EURJPY fell to a six-week low of 128.32.

The British Pound dropped to a two-week low against the United States dollar as Prime Minister Theresa May rejected the EU's proposal regarding the Irish borders. The meeting in Brussels failed to yield a Brexit deal, but the Chief European negotiator Michel Barnier said that they have a 90% chance of an agreement. As per ICM trading platform, the GBPUSD traded at a low of $1.3015, and the GBPJPY traded at a five-week low of 145.81.

Major U.S. indices finished the session lower with the Dow Jones losing more than 300 points on global growth concerns. The Chinese stocks traded at a four-year low to signal a possible slowdown in the global growth. As per ICM trading platform, the Dow Jones Industrial Average fell 1.3% to 25379, the S&P500 lost 1.4% to 2768, and the tech-heavy Nasdaq Composite Index dropped 2.1% to 7485.

Gold prices rebounded from a three-day low of $1219 to settle higher at $1226. The slide in the U.S. stocks boosted the demand for the precious metal as investors rushed to the safe haven amid rising risks and market uncertainty. The silver ounce bounced from a one-week low of $14.45 to trade at $14.66 during the Asian session.

Oil prices finished lower for the second consecutive day amid rising fears of a global economic slowdown. As per ICM trading platform, the West Texas Intermediate crude futures traded at a one-month low of $68.50 per barrel, and the Brent futures traded at a three-week low of $78.73 per barrel. The energy services firm Baker Hughes will report the U.S. oil rig count later today.

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Source: https://www.icm.com/en/market_news/Company-2018-10-19
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