Asia Morning: U.S. Stocks Tumble as Stimulus Hopes Fade
Ming Lam October 19, 2020 7:03 PM
No progress is made toward a stimulus deal agreement between the government and Congress...
On Monday, U.S. stocks closed sharply lower. The Dow Jones Industrial Average slumped 410 points (-1.44%) to 28195, the S&P 500 shed 56 points (-1.63%) to 3426, and the Nasdaq 100 tumbled 217 points (-1.84%) 11634.
Nasdaq 100 Index (Daily Chart) : Consolidation
Sources: GAIN Capital, TradingView
Despite House Speaker Nancy Pelosi calling on the government to reconcile remaining disputes on a fiscal stimulus package within 48 hours, no progress was made toward a deal agreement between the government and Congress.
Technology Hardware & Equipment (-2.27%), Energy (-2.1%) and Software & Services (-2.01%) sectors lost the most. Nordstrom (JWN -5.88%), Gartner (IT -4.41%), Ross Stores (ROST -4.37%) and VF (VFC -4.33%) were top losers.
ConocoPhillips (COP -3.17%) said it has agreed to buy U.S. shale oil producer Concho Resources (CXO -2.76%) for $9.7 billion.
Approximately 75% (74% in the prior session) of stocks in the S&P 500 Index were trading above their 200-day moving average and 81% (83% in the prior session) were trading above their 20-day moving average.
European stocks were broadly lower while trading volumes were greatly reduced by a technical glitch at exchange operator Euronext. The Stoxx Europe 600 Index declined 0.18%, Germany's DAX 30 fell 0.42%, France's CAC 40 eased 0.13%, and the U.K.'s FTSE 100 was down 0.59%.
U.S. Treasury prices posted modest losses, as the benchmark 10-year Treasury yield rose to 0.760% from 0.740% Friday.
Spot gold rose $4 (+0.22%) to $1,903 an ounce.
U.S. WTI crude futures (December) declined $0.06 (-0.20%) to $41.06 a barrel.
On the forex front, the U.S. dollar weakened further against other major currencies, though its loss shrank at the end of the session. The ICE Dollar Index lost 0.27% to 93.43.
The British pound was lifted by the European Union's comments that it was ready to intensify talks with Britain toward a trade deal. GBP/USD once breached the key 1.3000 level before closing at 1.2954, up 0.31% on day.
EUR/USD jumped 0.45% to 1.1769, while USD/JPY was little changed at 105.43.
AUD/USD was down for a fourth session as it dropped 0.1% to 0.7071. China's Gross Domestic Products (GDP) grew 4.9% on year in the third quarter, lower than +5.5% expected.
Meanwhile, the Chinese yuan reached a fresh 18-month high against the dollar, with USD/CNH (offshore yuan) falling 0.26% to 6.6787.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.