Asia Morning: U.S. Stocks Pause Rally

Market sentiment is dampened by news reports that Johnson & Johnson and Eli Lilly are respectively halting trials on their COVID-19 treatments...

Trading floor 2

On Tuesday, U.S. stocks paused their recent rally. The Dow Jones Industrial Average declined 157 points (-0.55%) to 28679, the S&P 500 slipped 22 points (-0.63%) to 3511, and the Nasdaq 100 dipped 4 points to 12083.

Dow Jones Industrial Average (Daily Chart): Watch Record Close at 29550

Sources: GAIN Capital, TradingView

Market sentiment was dampened by news reports that Johnson & Johnson (JNJ -2.60%) and Eli Lilly (LLY -2.85%) were respectively halting trials on their COVID-19 treatments.

Banks (-2.72%), Insurance (-2.47%) and Technology Hardware & Equipment (-2.35%) sectors lost the most. Cruise-ship stocks -- Royal Caribbean Cruises (RCL -13.20%), Norwegian Cruise Line (NCLH -8.24%) and Carnival (CCL -7.76%) -- were top losers.

JPMorgan Chase (JPM -1.62%) and Citigroup (C -4.73%) declined after reporting third-quarter earnings. 

U.S. official data showed that Consumer Prices grew 0.2% on month in September (as expected).

European stocks were broadly lower. The Stoxx Europe 600 Index fell 0.55%, Germany's DAX 30 sank 0.91%, France's CAC 40 lost 0.64%, and the U.K.'s FTSE 100 was down 0.53%.

U.S. Treasury prices increased, as the benchmark 10-year Treasury yield fell to 0.726% from 0.775% Friday.

Spot gold dropped $31 (-1.61%) to $1,891 an ounce, pressured by a stronger dollar.

Oil prices were lifted by upbeat Chinese trade data. U.S. WTI crude futures (November) rose $0.76 (+1.93%) to $40.19 a barrel.

On the forex front, the U.S. dollar regained some strength against other major currencies, as setbacks in trials of COVID-19 treatments and deadlocked talks on new fiscal stimulus drove investors to the safe-haven currency. The ICE Dollar Index jumped 0.53% to 93.53, the biggest increase in three weeks. 

Both the euro and the British pound weakened against the dollar as Brexit talks did not yield sufficient progress. Investors were also concerned with resurging coronavirus cases in both the U.K. and Europe. EUR/USD dropped 0.56% to 1.1745, and GBP/USD fell 0.97% to 1.2937 ending a four-day rally.

USD/JPY rebounded 0.13% to 105.47.

Official data showed that China's exports rose 9.9% on year in September (+10.0% expected) and imports jumped 13.2% (+0.4% expected). However, the Australian dollar was dragged by reports that China has banned imports of Australian coal. AUD/USD was down for a second day as it shed 0.67% to 0.7160 

USD/CAD rebounded 0.19% 1.3139 halting a four-day decline.

More from Equities

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 or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

Open an Account