By Deepta Bolaky
 @DeeptaGOMarkets

Equity Markets

Wall Street rebounded from the dramatic sell-off on Tuesday amid signs that China will intervene to stabilise the offshore Yuan. The People’s Bank of China plans to sell the bill issuance in Hong Kong. It is seen as the most efficient way to absorb liquidity and prevent further deprecation of the offshore Yuan.

Major US equity indices rebounded from its worst day of the year and ended in positive territory lifted by China’s moves.

US sharemarket: Dow Jones Average Industrial +0.5%, S&P 500 +0.3%, and Nasdaq +0.7%.

Source: Bloomberg Terminal

Investors were relieved that China is attempting to stabilise its currency, and it is reported that both countries will meet again in September for another round of negotiations.

Currency Markets

In the currency markets, major currencies remain mixed against the US dollar caught in the risk-off and risk-on sentiment.

Source: Bloomberg Terminal

The Canadian Dollar emerged as the worst G10 currencies against the US dollar on Tuesday. Following a public holiday on Monday, the markets were forced to catch up on Tuesday on heightened trade tensions.

The Japanese Yen which benefitted from haven flows on Monday moved lower against the greenback after risk sentiment improved.

The Aussie dollar managed to crawl a little bit higher on the upbeat trade balance, which came above expectations at $8.04bn. It is currently trading at 67.60 US cents.

Commodities

Oil traders have many factors to digest on both the demand and supply side. Trade wars, global growth concerns and tensions in the Gulf are taking oil prices on a volatile rollercoaster ride. There was news that Iran’s oil was shipped to China in defiance of the US sanctions.

The relief in the markets helped to stabilise the prices of oil. In the short-term, we expect the supply side to remain the supportive factor for oil prices. However, growth concerns will likely continue to overshadow the oil market and cap any upside momentum.

As of writing, WTI and Brent Crude is trading lower in the vicinity of $53 and $58

UKOUSD and USOUSD (Hourly Chart)

Source: GO MT4

Gold remains on the upside bolstered by the volatility and uncertainties in the markets. Even though the momentum improved on Wall Street after China’s express its willingness to curb the Yuan’s depreciation, trade tensions are unlikely going to disappear anytime soon.

As of writing, the XAUUSD pair is currently trading at $1,472.

Source: Bloomberg Terminal

Cryptocurrencies

The mayhem in the financial markets might have driven investors towards digital assets. The crypto market was seen trading higher at the start of the week. Bitcoin, the bellwether of cryptocurrencies rose above the $12,000 mark on Tuesday to finish lower in the range of $11,600 as risk sentiment improved.

BTCUSD (Daily Chart)

Source: GO MT4

Key Upcoming Events Ahead

Thursday, 08 August 2019 Indicative Index Dividends Dividends are in Points
ASX200	WS30	US500	US2000	NDX100	CAC40	STOXX50
3.06	28.519	0.74	0.141	0.052	0	0.833
ESP35	ITA40	FTSE100	DAX30	HK50	JP225	INDIA50
0	0	37.796	0	0	0	2.024