Equities volatile, trying to erase Friday’s losses

Stocks were volatile today but managed to erase a large bearish gap on Sunday evening as investors bought the dip.

However, the US session often brings selling into rallies and this has happened today as well. Thus, indices were trading flattish on the day, but well off the daily lows (although off daily highs as well).

Sentiment improved earlier in the day after China reported that Beijing saw only 9 new cases suggesting that the latest breakout in the capital had been contained while South Korea saw the smallest daily increase in about a month, prompting renewed optimism that everything is once again under control.

April’s collapse was the largest since July 2010’s expiration of the first-time homebuyers credit, and May saw the plunge continue, falling 9.7% MoM (against expectations of a 5.6% MoM decline). The median existing-home price for all housing types in May was $284,600, up 2.3% from May 2019 (278,200 USD), as prices increased in every region. May’s national price increase marks 99 straight months of year-over-year gains.

The US dollar dropped today and failed to continue in its last week’s rally, with the EURUSD pair climbing 0.8% to trade at around 1.1260. Commodity-linked currencies were trading 1% higher today.

Oil was also higher and the WTI benchmark seems to be settling above the 40 USD level, which could be a positive sign for other markets.