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Is Lyft dip an April fool’s joke?

Forex 4 minutes to read
MO
Michael O’Neill

FX Trader, Loonieviews.net

Summary:  Lyft's IPO today was about as profitable as a slow puncture and the freshly-minted shares took a hammering. Elsewhere, US dollar strength leaves oil traders in a quandary.

Need a lift? Lyft (Lyft: Nasdaq) shares certainly do. The ride-hailing company’s shares have been on a wild ride since Friday, its first day of trading. As of 14:15 GMT, Lyft’s shares are trading nearly 2% below its IPO price of $72.00.

FX traders tend to jump on bandwagons, and equity traders are no different. Better than expected China Manufacturing PMI stoked stock market rallies in Asia and Europe, which made for an attractive bandwagon for Wall Street. The Dow Jones Industrial Average opened with triple-digit gains, followed by an 0.82% pop in the Nasdaq and a 0.72% jump in the S&P 500. Official China data is somewhat sketchy which raises questions about the sustainability of today’s rally, especially in the absence of fresh news on the progress of the US/China trade talks. 

US ISM manufacturing PMI didn’t disappoint. March data rose 55.3 compared to forecasts for an unchanged result from February. Construction spending also beat estimates. 

The news underpinned the US dollar, and EURUSD dropped from 1.1246 to 1.1211. The single currency saw additional selling pressure after the European Central Bank annual report repeated that inflation is muted and growth is weaker than expected. USDJPY popped to 111.17 from 110.84 getting an added boost as 10-year US Treasury yields climbed to 2.478% from 2.444%. GBPUSD has slipped from its peak following the US data, but Brexit headlines are the only driver that counts. The US data knocked AUDUSD and NZDUSD from their overnight highs. The US data knocked AUDUSD and NZDUSD from their overnight highs.

 USDCAD traders are torn between buying because of broad US dollar strength and selling due to surging oil prices. WTI oil punched above $61.00/barrel in New York and touched $61.12/b before easing back to $60.90.
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Chart: Commodity bloc currencies 15 minuteview. Source: Saxo Bank

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