Asia Morning: US Stocks Rebound after 3-day Selloff

On Wednesday, the three major U.S. stock indices rebounded after a three-day decline. European Central Bank's interest rates decision will be today's key focus...

Trading floor 3

On Wednesday, the three major U.S. stock indices rebounded after a three-day decline. The Dow Jones Industrial Average rose 439 points (+1.6%) to 27940 and S&P 500 climbed 67 points (+2.0%) to 3398 and Nasdaq 100 gained 293 points (+2.7%) to 11141.

S&P 500 daily chart:

Source: Gain Capital, TradingView

Source: Gain Capital, TradingView


Technology Hardware & Equipment (+3.42%), Software & Services (+3.35%) and Semiconductors & Semiconductor Equipment (+3.22%) sectors gained the most. Approximately 59.4% of stocks in the S&P 500 Index were trading above their 200-day moving average and 27.3% were trading above their 20-day moving average.

Later today, European Central Bank's interest rates decision will be the key focus (expected to be unchanged). Meanwhile, the U.S. Labor Department will report July PPI (-0.3% on year expected) and initial jobless claims in the week ending September 5 (0.85 million expected).

European stocks were broadly higher. The Stoxx Europe 600 Index advanced 1.8%, Germany's DAX 30 jumped 2.1%, France's CAC 40 and U.K.'s FTSE 100 were up 1.4%.

The benchmark U.S. 10-year Treasury yield bounced to 0.7001% from 0.6788% Tuesday.

WTI crude oil futures (October) rebounded 3.5% to $38.05 a barrel, following a 7.6% decline in the prior session. The American Petroleum Institute (API) reported that U.S. crude-oil inventories increased 2.97 million barrels in the week ending September 4 (-1.89 million barrels expected).

Spot gold gained 0.8% to $1,947 an ounce.

On the forex front, the U.S. dollar eased against its major peers, with the ICE Dollar Index slipping 0.3% on day to 93.24.

EUR/USD rose 0.2% to 1.1806. The European Central Bank is expected to hold its key rates unchanged later in the day, while it is reported that some policy makers have gained more confidence in the bloc's economic outlook.

GBP/USD marked a day-low of 1.2886 before closing 0.1% higher at 1.3003.

USD/JPY gained 0.2% to 106.20. This morning, official data showed that Japan's core machine orders grew 6.3% on month in July (+2.0% expected).

USD/CAD retreated 0.6% to 1.3151. The Bank of Canada kept its benchmark rate unchanged at 0.25% as expected and maintained its large-scale asset purchases of at least 5 billion Canadian dollars per week of government bonds.

Other commodity-linked currencies were broadly higher against the greenback, AUD/USD rebounded 0.9% to 0.7279 and NZD/USD bounced 1.0% to 0.6684.

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.