Market Commentary – September 24, 2020

Kevin Jock

24th September 2020

It was a bullish day for the European majors while the index in Europe were rising. There is a sharp pickup in manufacturing sector activity in September, with the Manufacturing PMI in Eurozone hitting 53.7, a 25-month high. There is a continued slide in the EURUSD, falling back to around 1.16.


Figure 1 (Source: IS Prime): EURUSD Intraday


The Crude Oil Inventories fell by 1.6 million barrels in the week to Sept. 18 to 494.4 million barrels, compared with the expected 2.5 million-barrel drop. Data showed that the crude oil inventories has done nothing to impact price. It remains bullish despite the lower-than-expected drawdown.

Federal Reserve Chairman Powell Testifies and Treasury Sec Mnuchin Speaks. Both Mnuchin and Powell state that there is little more the Federal Reserve or the administration can do to provide support through existing programs. They suggest lawmakers to do their part to authorized new spending.

From the economic data in the US, it can be seen that the service sector activity are recovering slowly in September but at slightly weaker pace.

The Nasdaq dropped by 3.02%, S&P dropped by 2.37% and Dow decreased by 1.92%.

Headliner to Review

    • Flash Manufacturing PMI in Europe increased from 51.7 to 53.7 while the Flash Services PMI declined from 50.5 to 47.6.
    • Flash Manufacturing PMI in UK dropped from 55.2 to 54.3 while Flash Services PMI dropped from 58.8 to 55.1
    • German Flash Manufacturing PMI increased from 52.2 to 56.6 while German Flash Services PMI decreased from 52.5 to 49.1
    • French Flash Services PMI declined from 51.5 to 47.5 while French Flash Manufacturing PMI increased from 49.8 to 50.9

      Economy in Europe barely grow in September. The economy in eurozone got a hit in September due to the new rise in coronavirus cases. The purchasing manager index (PMI) are as below:

  • U.S. business activity increases at slightly weaker pace in September from the PMI figures:

    • US Flash Manufacturing PMI increased from 53.1 to 53.5
    • Flash Services PMI dropped from 55.0 to 54.6

Headliner to Watch

  • Federal Reserve Chairman Powell and Treasury Secretary Mnuchin are in focus.

  • US Unemployment Claims will be released. It is expected that the figures will decrease from 860k to 845k.

  • Bank of England Gov Bailey Governor Andrew Bailey will speak tonight.

  • It can be expected that the number of new COVID-19 cases in Europe will have an impact across EU.

Any opinions, news, research, analysis, prices, or other information contained on this website is provided as general market commentary, and does not constitute investment advice.

Antony Tan
Ben Li
Kevin Jock