Market News & Analysis

Trade war fears continue – stocks and oil hit, Gold jumps.

May 24, 2019 | Market Update

Today’s High-impact economic news:

GBP 18:30 UK Retail Sales

USD 22:30 Core Durable Goods Orders – Durable Goods Orders


Well, the trade war looks like becoming a new Brexit, not long ago it looked like the U.S. and China we’re both close to an agreement. Fast forward to now and that seems like a distant memory. Huawei has become a main focus and fear selling has spread to many tech companies that could be impacted by the trade war or have any connection. The U.S. has started new tariffs and China has threatened retaliation, a key target being at U.S agriculture, specifically soybeans. 

The markets are now waking to the idea that this might be a long drawn out process and global growth could also be impacted a longer-term trade war. Stocks are showing the worry, we’ve seen strong falls this week in the U.S. China and Europe. Oil traders have also joined in with growth fears worrying future demand. 

“The trade landscape looks bleaker than ever,” said Adam Crisafulli, executive director at J.P. Morgan, in a note. “Anyone bullish on the SPX has to be conducting a lot of soul searching at the moment.”

Another bad day for global shares, futures gave the indication mid-Asian session with U.S and European index futures dropping. Asian shares ended the session sharply lower. European indices all ended deep in the red, the DAX losing 1.78%. U.S. shares fell for a 2nd session the Dow losing 1.11% and the Nasdaq lost 1.58%.

Oil was hammered on growth fears which are now connected directly to trade war fears. Crude lost 5.7% overnight! Gold rebounded on a flight to safety and fight back to the USD from the main risk majors. Gold closed just over $10 higher. The EUR and AUD and GBP all rebounded to the USD, the EUR and GBP fought back from new lows to end the session in the positive. The Yen remained in demand closing higher to the majors, the USD hammered losing 75 pips to the JPY.

The ASX200 CFD has started the session flat, downward pressure remains. Risk currencies have started Friday’s session with a mini fightback to the USD the EUR and GBP tracking higher. 

Crude’s hammering in yesterday’s session.

Good trading from EightCap

Sources – CNBC – All times AEST

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