By Deepta Bolaky
Global stocks started the week on a mixed note. The stock market advanced on the back of technology stocks, fresh stimulus from China and the delay in the US-China trade meeting.
The performance on Wall Street was mixed, dragged by the standoff in Congress over the coronavirus relief package. The Dow Jones ended in negative territory while S&P 500 traded near record highs. The Nasdaq Composite rallied to a new record high lifted by technology stocks.
S&P 500 has flirted near record highs recently but were unable to break decisively to a fresh record high. Investors are concerned that this could be a signal that the index is losing its bullish momentum. Further delays by US lawmakers to agree on a stimulus package is a source of worry for investors as the momentum is heavily dependent on the amount of money being injected into the economy.
In the FX space, major currencies were stronger against the greenback. Amid a relatively subdued calendar, the price action in the currency markets was limited.
The Aussie dollar was the best performer among the G10 currencies against the US dollar. The Antipodean currency gained on higher commodities prices and the news of stimulus coming from China. The PBOC injected around $101 billion in the country’s financial system on Monday.
On the economic front, Japan’s economy contracted the worst on record. GDP contracted an annualised 27.8% in the 3 months through June from the previous quarter.
Ahead of the weekly oil inventories reports, crude oil prices advanced higher on the back of a weaker US dollar and China’s stimulus. As of writing, WTI Crude oil (Nymex) and Brent Crude (ICE) were trading higher around $42.80 and $45.29 respectively.
Gold trading was volatile last week. After reaching fresh record highs, the precious metal plunged and slipped the most in seven years. Despite broad optimism, the virus woes, ongoing fiscal support, geopolitical tensions, uncertainty of the global economic outlook still favours the demand for the haven asset. The yellow metal advanced higher on Monday.
As of writing, the XAUUSD pair is currently consolidating around the $1,980 mark.
By Deepta Bolaky
Key upcoming events
|Wednesday, 18 August 2020
Indicative Index Dividends
Dividends are in Points
Disclaimer: Articles and videos from GO Markets analysts are based on their independent analysis. Views expressed are of their own and of a ‘general’ nature. Advice (if any) are not based on the reader’s personal objectives, financial situation or needs. Readers should, therefore, consider how appropriate the advice (if any) is to their objectives, financial situation and needs, before acting on the advice.
Proud partner of Chelsea Football ClubFind out more