 Okay, very good morning to you Anthony Chung here. I'm the head of market analysis and fight trading If you go to my Twitter account, so my handle a WM Chung You'll be able to find the latest macro menu. I've pinned it to the top of my my latest tweets But as you can see it's a lot of stuff I'm talking about this morning is in regards to North America and the potential Tracking of the second or the size of the second wave of the coronavirus in America There's also been developments in Beijing over the weekend Japan as well has seen a pick up over the weekend And so this is definitely what's dominating market psyche at the European Open this week Also, if you are watching this On YouTube and you wanted to get the morning briefings earlier then check out amplify live I'll put a link in the description of this video if you want to have a look and to get that and more other Exclusive content before everyone else does that's the place to go But having a look then at the charts this morning. Let's just discuss then how things are performing at the Commencement of trade and as you can see we've had a gap down in the US equity index futures This has come as I said with focus still on the second wave risk Emerging with the increase in the trajectory of the coronavirus rates in various different areas in America Which we'll have a look at in a moment But as you can see here from the the Dow to the SMP these charts here breaking through quite key Technical levels the the chart somewhat mirroring each other to some extent because if I just remove that horizontal line You can see here in the S&P 500 the gap down and the overnight Opening test that we had on the low on Friday, which is around that s1 level So I just put a support level there and you can see as Europe has come in early We've broken through that level but now pretty similar setup But here you've got Thursday and Friday low the reopening low So on the fourth attempt really and through that s1 on the daily pivots We've had a run down to now just kind of settle At around the s2 but already down about 837 points here this morning in the downs so it's a pretty pretty heavy move in that respect And as you would imagine then that's generally being reflected in the other asset classes The dollar has been rising of late and that's putting a little bit of moderate downside pressure in the major pairs perhaps a little bit of discrepancy between Euradollar left and cable a couple of cable headlines to be aware of you've got the recommencement of top-level talks between European Commission and Boris Johnson Taking place later on today and obviously coming closer towards that looming deadline and a lot of the weekend press suggesting of the UK pursuing its kind of Push to accelerate negotiations or to face the risk of a no deal has been the talk And then elsewhere T-notes up around nine and a half ticks where we're just above the high that we've seen in the Asia Pacific session oil lower as you would imagine kind of tracking in step with the ramifications that a covid pickup would have in a second wave form for global growth potential so not just equities oil also lower and Retesting at the minute around the load it was seen on Friday. The only asset that isn't really Reflecting this general risk of sentiment is gold Don't have too much of an explanation for that to be quite honest with you right now technically we're Below the s1 we've seen a bit of a downfall as Europe has come into the market perhaps then now we've got a fairly strong level of potential Resistance now on any recovery that we might see but of course when the US come in and if things do trade quite heavy The logical response would be that would provide a bit of supportive tone for gold But now any push back up to a wards Really the s1 and then just above around 27 to encapsulate some of that previous high and low from last week's price activity Could be something to watch as well So let's have a look then at this story that's been in development over the weekend and gonna kick off things with a Map here of hotspots in the United States of America and what we're looking out We're looking at here is a map of America by Different states and the color code key is blue where coronavirus cases over a two-way period of declining and red The more deeper darker the red color the more it's rising and as you can see here. There are a number of highly Populated areas which are seeing quite a distinct pickup and in fact more than 20 US states did see a pickup in cases over the weekend Alaska, Arizona, Arkansas, California, Florida, North Carolina, Oklahoma, South Carolina all experienced record increases in coronavirus during the past three days and so Here are some of those key areas of which caused the catalyst for the sell-off on Thursday if you remember Which was really these these big significant areas as far as the economic situation of America is concerned And which is causing some to kind of reprice these assets for then What had to be in a fairly smooth process of reopening the economy was fairly limited new cases has now started to see quite a More steeper curve of infections materializing so here California, Texas, Florida, obviously very much in focus Arizona being another one which has seen a very Steep incline Florida is one of those and we've seen photos on Saturday. I think Miami Beach was just packed the weekend Florida they reported 75,658 COVID-19 cases on Sunday That's up 2.7% from a day earlier can compared with an average of 2.3% over the previous Seven days and so as it was last week, it will remain now and in the coming days Really important to keep a very close eye on these daily Rates that come out now from recollection last week when it gets London time to around the afternoon sort of 2 or 3 o'clock That's when we start to see updates from each daily kind of stamp If you like if you think about it in North American hours, that's first thing in the morning They issue them the previous day's logging of infection rates and really you're looking at the increase of that figure Over then the seven-day kind of average and at the moment that has been going on a steady Incline in some of these key areas and that could be a trigger point then depending on how big those jumps are For another negative run or impact on markets The other thing that's happening is not just in America in Beijing. There's been quite a distinct Pickup in the fact that what was shut at the weekend was the city's largest fruit and vegetable supply center What it's led to is locking down nearby neighboring housing districts as a dozens of people associated with a wholesale market tested positive for the virus now What's always problematic in China is just how densely populated it is and To give you an idea this market in question. It's not like the farmers markets You'll get on a Sunday afternoon in Britain this market covers a hundred and twelve hectares and has 1500 management personnel and over 4,000 tenants so it's huge and just given the nature of this this spread and there's been some talk as well That could cause complications that some of the latest strains of which they've been testing could show that that actually this is This has been brought in as well to some extent with some European movement back into the country Has caused complications and China are not taking any risks They're looking to shut down things as quickly as possible to regain control, but just given the But the development and the potential for this to spread quite quickly This again is kind of in combination with those US figures is what's causing some of the nervousness in markets this morning elsewhere globally Although places like New York and London continue to be fairly contained If anything have seen some of the lowest cases that we've had ever since the onset of the outbreak places like Japan for example have seen a jump over the weekend So it's a little bit of a mix but very much more dominated by the fact that if you think about the UK They're a little bit behind in regards to we're only just about to go into a reopening of say Non-essential retail shops today on June 15th And so these other countries have already kind of are further down that reopening route And so therefore they're kind of further down this kind of second case virus, so that's definitely What's driving sentiment and what will probably dictate proceedings if I'm not just today, but throughout the entire week One thing to be aware of with equity index features down already quite heavy the S&P down over 3% If you go on my Twitter account, I've really shared basically a tweet from new squawk which have put out the Circuit breakers the limit downs for globe x trade So here the 5% if I go to the S&P first, we're trading this morning At 2929 now the the session lows at 2923 and three quarters The 5% stop comes in basically at 2888 so a little bit further to go as yet But worse bearing that in mind if we get to that 5% limit down and then once we go into the The nizy in the open Then here are the respective level one two and three increments with the the levels for both the S&P The Nasdaq and the Dow probably worth having those jotted down on a piece of paper In case things do get quite volatile to the downside later on in the session Other things to be aware of for this week We do have an EU leaders gathering virtually at least at the end of the week culminating on discussions on Friday Well, they'll look to debate the recovery fund to repair the COVID-19 damage that we've seen in the eurozone And the main thing that people are looking at here is this the kind of meat and bones around this 750 billion euro European wide recovery fund this Few weeks ago and as you can see on this chart here I've got the yellow which we've seen as the real distinct pick up in euro dollar Now what that had been before last week's nervousness on the second wave had been a reversal of the risk premium in the flight To quality in the dollar following what we had seen through March And so dollar weakness was promoting some euro strength by default But over delivery from ECB in the QE program a second large unexpected stimulus coming out of Germany And then this kind of Franco-German plan for a rescue fund Then the intensive agreement on the European wide basis had seen the euro really outperform so This week's going to be quite important because now we need to see really the facts and figures of what does this deal consist of And obviously the frugal four Netherlands Austria Denmark and Sweden Will be the ones to watch and they're going to be resistant at the final hurdle to getting this deal over the line And so what would be some susceptible is not just the euro dollar currency given some of the recent market positioning But also southern european bonds So the red line here is looking at what we have seen over the last real six weeks Is generally the tightening of the german The italian german tending a bond yield spread indicative of more I guess confidence about the the future but any fall down Of this european wide Fiscal deal would see then more pressure Coming onto those bonds the respective yields would rise which could blow out those spreads and friday It's going to be quite a a key day for monitoring those for sure Um sticking with europe But with the uk kind of thrown in Boris johnson returns to brexit with the aim of firing up faltering talks So the p.m. Will say that while the uk still wants a free trade agreement with the eu It isn't afraid to walk away at the end of the year without one This is what a lot of the uk press was suggesting at the weekend So as far as the meetings that are happening today prime minister and eu officials holding a teleconference call I would not be expecting any kind of concrete developments to materialize as soon as now I would say it's still pretty much setting out the Root that they're on which is for the uk I think it's still really a little bit early perhaps then Toward the deadline at the end of the month for the transition But what it's looking more likely at this point is that they're not going to press a transition That we're going to push through and some of the reports today have said that if discussions can make progress in july and august And wrap up in september eu leaders could be asked to ratify a deal at their scheduled summit in october So that's the kind of timeline of which the uk government apparently is working to at this point of time which does mean then that There is still A risk of a no deal materializing and you you could see a bit of an increase in the in In some weight for the british pound as we get towards the end of this month As then we've not inaction that request for a transition Just increases the still a base on expectation that some kind of deal might get done But obviously we've removed one of those kind of Obstacles that could have caused a more positive reaction if the uk had agreed to extend by another two years or not All right the other things to be aware of a couple of Interest rate decisions now we do have some uk data coming out throughout the week you get retail sales Unemployment numbers inflation numbers So we get a good economic kind of health check out of the uk and this of course comes after the disastrous kind of april gdp reality That we had and so given that and given the types of language that we've seen from this chap The governor andrew bailey just last week who basically said he's ready to take further action All expectations are that the bank of england will increase their quantitative easing program The expectation From quite a few banks is around 150 billion pounds That would then buy them enough a few months given the pace of purchasing that they're doing at the at the moment Enough enough months further down the road in order to see just how this plays out In terms of the economic recovery at this point and also the significance or not of the secondary wave virus And so rather than doing these kind of short-term gap fills in policy if you like And then that's going to make the market kind of increasingly nervous at every review Probably better they go for something like 150 to just kind of kick the can down the road a couple of months And then and then revise things as they see fit Further down the line. So, yeah bank of england I guess if they don't do that if they don't increase their QE by that type of magnitude Then that's when it could be an interesting event from a trading perspective Because there'll be a lot of people disappointed At that point in time if they don't pull the trigger and increase by that kind of amount Boj they've also got an interest rate decision. However I'm not expecting a great deal here Officials likely to consider the impact of measures taken so far according to people from a little bit of matter reported in Bloomberg this morning So anticipated to leave their main policy kind of levers untouched as it were Quickly having a look at the calendar I've pretty much covered over all of the major things We did have some Chinese data overnight Retail sales industrial output were marginally weaker than expectations in may albeit a slight improvement from the prior month Other interesting data you've got coming out of the states You've got us retail sales coming on Tuesday You get your regular weekly jobless claims still going to be somewhat elevated But albeit on that downward trajectory We've had over recent weeks But that comes alongside the Philly Fed business index we'll get on thursday U. S building permits housing starts will come on wednesday So yeah a few things to to keep an eye out on Throw in the mix as well quadruple witching which we'll get towards the end of the week So if people are still somewhat nervous About the development of the virus particularly in north america I could see quite a volatile End to the week at that point if you throw in the fact of those explorations in options of futures Um, so that's it any questions at all feel free to Leave a comment on the video obviously this morning as far as markets are concerned We are Awaiting now the u.s. Entrance to see where they take this market Just given some of the overnight and european movement that we've had as far as the s&p is concerned From a longer time frame here on a daily continuation, you know, interestingly Last week's sell-off that we had and then the friday volatility We did manage to close above the 200 day moving average But the gap down the reopening of trade just given some of the weekend's news We came back up to test that same level before then pushing down here And now that we've made a concerted move beneath that 200 dma and that resistance point in the april may kind of resistance area Then the next logical target might well be down at that 2903 Which if seen pre-market opening hours, which is also that low on the 22nd of may Then that circuit breaker resides just below the 29 marker 28 88 So yeah could be in for an interesting start to the week for sure And all eyes and ears remain On the updates on the trajectory of the coronavirus in america in several key states All right guys, that's it from me. I'm going to wish you a good day and week ahead and I'll see you tomorrow. Thanks very much