U.S. stock advanced after President Donald Trump said he's considering a tax cut on capital gains and American hospitalizations for Covid-19 fell to their lowest in a month.
A broad rally from industrial goods to health-care shares set the Stoxx Europe 600 Index headed for its best increase in a week.
Treasuries and European bonds extended their declines. The dollar turned lower against its major peers including the euro, after a German gauge of investor confidence unexpectedly surged. Gold fell for a third day.
Technology shares led U.S. stocks lower after the benchmark S&P 500 approached an all-time high reached before the coronavirus pandemic. Crude oil gained and the dollar strengthened. The tech heavy Nasdaq Composite Index slumped for a second day. The S&P 500 Total Return Index, which includes reinvested dividends, rose earlier to an all-time high, exceeding its February peak. The price-only version rose to less than 1% away from breaking out before turning red. In Europe, stocks advanced led by financial companies. Chinese equities climbed on the back of data showing the economy continuing to recover from the pandemic, with consumer inflation accelerating. On Saturday, President Donald Trump signed four executive orders to maintain some assistance, including for unemployment benefits, a temporary payroll tax deferral, eviction protection and student-loan relief. Trump's policy announcements come as Democrats and Republicans are still negotiating a broader additional virus relief package. The two sides are still trillions of dollars apart on overall spending and on key issues, including aid to state and local governments and the amount of supplementary unemployment benefits. European stocks briefly dipped on Monday after China retaliated against the U.S. by sanctioning 11 Americans. The list includes Senators Marco Rubio and Ted Cruz, but no members of the Trump administration. Still, it's another sign of discord between the two nations as the Trump administration takes a harder line against China in the run-up to the November election
Yesterday, USDCAD dipped to 1.3244 – just shy of Wednesday's low of 1.3234 (lowest since Feb. 21) before climbing to 1.3323. After equity markets rallied to new highs, USDCAD dropped back to 1.3275 before climbing back to 1.3320 in late trade as Trump announced a 10% tariff on Canadian aluminum imports into the United States. The CAD continued to weaken overnight as Canada threatened $ for $ countermeasures sending USDCAD back up through the broken support zone (1.3320-1.3330) to a high of 1.3372. Both Canadian and U.S. job numbers beat estimates while North American equity markets recouped overnight losses. The S&P 500 and NASDAQ are holding near all-time highs. USDCAD dipped to 1.3325 but has since turned higher on broad-based USD strength. U.S. yields are higher as well while the Dollar index has climbed from 27 month lows (92.50) towards a 4 day high (93.62). The USDCAD rally higher stalled just shy of 1.3400 before easing back to 1.3375. The market now awaits any news on the Covid stimulus front as the U.S. has yet to finalize a new deal to replace the support that expired at the end of July
U.S. applications for unemployment benefits fell more than expected last week to the lowest since the pandemic started, in a broad decline across nearly all states, suggesting the labor market is improving.
Initial jobless claims in regular state programs fell by 249,000 to 1.19 million in the week ended Aug. 1, Labor Department data showed Thursday. The median forecast in a Bloomberg survey of economists called for 1.4 million. Stocks erased earlier declines after the figures.
U.S. equities declined with stocks in Europe after a string of poor earnings illustrated the continuing hit from the pandemic.
American International Group Inc. fell in the U.S. pre-market after posting a $7.9 billion loss after Monday's close. Diageo Plc tumbled in London when the drinks giant provided no 2021 guidance. Bayer AG dropped after downgrading its sales outlook. Bonds climbed and the dollar turned higher against its biggest peers.
Yesterday, USDCAD climbed from near 5 month lows @ 1.3334 to a 1 week high @ 1.3460 despite broad-based USD weakness. The USD index has fallen from near 3 year highs back in March (103) to 27 month lows this week (92.55). Equity and oil markets were under pressure much of the day with the DJIA down nearly 500 pts and WTI crude down nearly 6% at one point before rebounding. USDCAD did fall back to 1.3415 before moving back to hold near 1.3430. Overnight, the USD was initially under pressure during the Asian session before recovering. USDCAD continues to hold just above the 1.3400 level as equity and oil prices are under some pressure once again.
U.S. stocks climbed on speculation the Federal Reserve will signal continued economic stimulus and as traders sifted through a batch of corporate earnings. Bonds rise and the dollar fell. The S&P extended its July rally and was on track for a fourth consecutive monthly gain. As earnings season rolls in, traders will be looking for corporate outlooks to gauge a potential rebound from the coronavirus-induced recession. The Federal Open Market Committee is all but certain to keep its benchmark rate unchanged and reinforce the message that it will do whatever it can to support the recovery. The Fed will release a statement at 11am, and Chairman Jerome Powell will hold a press conference 30 minutes later. Quarterly forecasts are not due to be updated at this meeting.
Stocks fell Tuesday morning, with stimulus talks in Washington, updates on the Covid-19 vaccine front and corporate earnings results front and center.
After market close Monday, Senate Republicans led by Majority Leader Mitch McConnell announced the HEALS Act, or proposal for a new stimulus bill to help individuals impacted by the economic fallout from the coronavirus pandemic.
The Health, Economic Assistance, Liability Protection, and Schools Act includes a second stimulus check worth up to $1,200 for the same group of Americans as the last round. Also, it will extend enhanced unemployment assistance at a lowered rate of $200 per week, down from $600 per week previously, until states could deliver a replacement worth about 70% of lost wages.
Oil erased gains to trade near $44 a barrel in London as concerns persisted over dwindling demand and growing supplies. Stocks have opened lower in North America as well.
Brent futures dropped as much as 1.2% as China's cooling oil consumption hurt prices for Iraqi crude, while derivatives that help value North Sea grades showed renewed weakness. In the U.S., crude stockpiles expanded unexpectedly, and jobless claims rose for the first time since March.
Oil jumped earlier this week after European Union leaders agreed on a massive stimulus package, but prices have struggled to break out of a tight range this month. While the race for a coronavirus vaccine intensifies, rising infections across major economies and the imminent easing of OPEC+ output cuts is keeping a lid on further price gains amid a patchy recovery in consumption.
U.S. stocks fluctuated as investors weighed the likelihood for a new spending bill, corporate earnings an escalation of tensions with China that could spill over into trade. The dollar weakened. The S&P 500 pared earlier gains, led by declines in the energy, commercial services and consumer discretionary sectors. Futures retreated overnight on news that the U.S. ordered China's Houston consulate to quickly close. Progress on combating the virus's impact also contributed to sentiment. The U.S. reported more than 1,000 deaths Tuesday. Pfizer Inc shares rallied after saying the government ordered up to 600 million doses of its vaccine candidate against Covid-19. Treasuries rose, while Silver continued its tear, climbing to the highest level in almost seven years. Fresh Sino-U.S. tension including new charges of Chinese hacking are adding to potential risks weighing on investors who recently drove global equities to a five-month high. After the success of a European rescue package this week, Senate Republicans and the Trump administration are struggling to reach consensus on another stimulus plan. The president warned the coronavirus crisis will probably worsen before improving. Elsewhere, oil in New York dropped from a four-month high on signs of a surprise gain in U.S. crude stockpiles.
Stocks rose Tuesday morning, following global equities higher after European Union leaders agreed to a breakthrough fiscal stimulus deal to help support the virus-stricken region. The Nasdaq Composite hit a record high, with tech shares rallying again.
After nearly five days of discussions, the 27 governments comprising the EU agreed to create a 750 billion euro, or $858 billion, recovery fund built through joint borrowing. The agreement will see about half of these funds distributed as grants to the EU states most devastated by the pandemic, while the rest will comprise low-interest loans.
The greenback remained on the defensive against its Canadian counterpart and pushed the USD/CAD pair to fresh daily lows, around mid-1.3500s in the last hour. The pair failed to capitalize on its early uptick to three-day tops, rather faced rejection near the 1.3600 mark amid the emergence of some fresh selling around the US dollar. The ever-increasing number of coronavirus cases in the US dampened prospects for a swift recovery for the domestic economy and kept exerting some pressure on the USD. The greenback was also pressured by a fresh leg down in the US Treasury bond yields, down around 3% for the day. This coupled with a slight recovery in the global risk sentiment – as depicted by a goodish bounce in the equity markets amid optimism over a potential COVID-19 vaccine – further dented the USD's relative safe-haven status. Meanwhile, a weaker tone surrounding crude oil prices, which tends to undermine the commodity-linked currency – the loonie, did little to impress bulls, albeit might help limit deeper losses. Hence, it will be prudent to wait for some strong follow-through selling before traders start positioning for a further near-term depreciating move.
Yesterday, USDCAD retraced the bulk of Wednesday's move lower (1.36 down to 1.35). Unable to break below the 1.35 mark, USDCAD rallied to 1.3545. After a brief correction down to 1.3511, the pairing climbed to hold near 1.3570-80 for the balance of the session. Wednesday saw the USD index test (and hold) the June lows before trending back higher. USDCAD has held a lackluster 1.3565 – 1.3589 range so far today. Trading ranges have been minimal within currency, commodity, and equity markets on the day thus far. The exception has been the Euro leading the pack and trading near 4 month highs vs the CAD and USD again. The EURO had fallen 1.5 cents from Wednesday's 1.5545 high but has recovered that loss today with a move to 1.5531.
Stocks opened lower on Thursday, as investors digested a deluge of earnings results and new economic data on the state of the consumer and labor market as the pandemic continues.
The ongoing economic impact of the coronavirus pandemic will be captured in two key reports Thursday morning. The Labor Department's weekly jobless claims revealed that another 1.3 million workers filed unemployment claims, slightly above consensus forecasts. However, retail sales skyrocketed by 7.5% last month — well above market expectations of 5% and on the heels of a record 17.7% seen in May.
In a widely expected decision, the Bank of Canada on Wednesday announced that it left its key rate unchanged at 0.25% at its June policy meeting. In its rate statement, the BoC noted that its central scenario doesn't expect the Canadian economy to return to pre-COVID-19 levels until 2022. The USD/CAD pair showed little to no reaction at the time of the decision, but has since then drop to the low of the day trading at 1.3520. BoC scenario sees Canada 2020 Q4 real GDP falling by 6.8%; projects 2020 real GDP down 7.8%, up 5.1% in 2021 and up 3.7% in 2022. Canadian economic activity in Q2 2020 is estimated to have fallen about 15% below its level at the end of 2019; economy appears to have hit bottom in April.
U.S. equities opened lower and European stocks dropped as investors weighed earnings season and the economic hit of rising virus cases.
While JPMorgan Chase & Co.'s shares climbed after reporting record trading revenue, Chief Executive Jamie Dimon voiced concern about the longer-term impact of the recession. Wells Fargo & Co. fell in pre-market trading after the bank posted a loss. Treasuries and the dollar were steady. The U.K.'s two-year bonds yielded less than Japanese debt for the first time. Copper ended a six-day winning streak amid renewed tensions between Beijing and Washington.
The USD/CAD pair closed the previous week with small gains but struggled to gather bullish momentum on Monday. After moving sideways below 1.3600 for the majority of the day, the pair lost its traction in the early American session dropped to 1.3535 before recovering a small portion of its losses. The selling pressure surrounding the greenback caused the pair to turn south in the last hour. Despite the surging number of confirmed coronavirus infections in the US, Wall Street's main indexes opened the day sharply higher on vaccine hopes. With the S&P 500 Index climbing to its highest level in more than a month above 3,200 and gaining nearly 1%, the US Dollar Index started to push lower and was last seen losing 0.35% on the day at 96.32. On the other hand, falling crude oil prices weighed on the commodity-sensitive loonie and helped USD/CAD limit its losses on Monday. However, the barrel of West Texas Intermediate, which slumped to a daily low of $39.65 during the European session, took advantage of the upbeat market mood and staged a rebound. At the moment, the WTI is posting small daily gains at $40.60, allowing the loonie to preserve its strength against its rivals. There won't be any macroeconomic data releases in the remainder of the day. On Wednesday, the Bank of Canada (BoC) will release its Monetary Policy Report for July.
Yesterday, USDCAD initially dropped from 1.3520 down to 1.3491 before climbing to 1.3594. The USD was broadly bid on safe-haven flows as the DJIA and S&P lost nearly 2% to trade near 2 week lows. Oil prices also declined by nearly 4% to trade near 2 week lows while the USD index rebounded from 1 month lows. Overnight, the trend continued with broad-based USD strength sending USDCAD up towards a 2 week high of 1.3631. The break above the double-top @ 1.3624 was short-lived with a move back to 1.3588 ahead of this morning's Canadian employment data. The number of jobs added in June beat forecasts including 488,000 full time jobs added (May saw an addition of 219,000 full time jobs). The unemployment rate fell less than expected while the reaction in USDCAD was mute. After a move to 1.3575, the rate moved to 1.3608 before falling back to hold near 1.3580. The USD has since given back its earlier gains and the USD index now trades near session lows. Equity markets and oil prices are trending slightly higher at the moment.
U.S. equities edged higher after a larger-than-forecast fall in initial jobless claims blunted concern that an increase in coronavirus cases will derail the world's biggest economy.
Tech shares once again led the advance, while the dollar slumped and Treasury yields dipped as initial jobless claims fell by 99,000 to 1.31 million in the week ended July 4. Continuing claims also declined, showing an improved labor market even as Covid-19 cases climb, pushing past 12 million worldwide.
In Europe, stocks rose for the first time in three days, with shares in the region's largest technology company, SAP SE, jumping more than 8% at one point after it reported better-than-expected second-quarter revenue on returning demand for software in Asia.
U.S. equities climbed as the biggest tech companies continued to rack up gains, overshadowing new tensions between Washington and Beijing and the uncertain outlook for economic recovery. HSBC Holdings Plc slumped after a report that some of U.S. President Donald Trump's advisers proposed a move to destabilize Hong Kong's currency peg as a way of punishing China. Gold topped $1,800 an ounce, while Treasury yields climbed and the dollar slumped. Banks led European stocks lower. With much of the world stuck at home, investors have been bidding up tech shares largely insulated from the coronavirus lockdowns. Analysts are debating what comes next for the U.S. economy as states allow businesses to re-open, but the hope among many traders is that the infections sweeping through parts of the nation will prove manageable. Tensions between the U.S. and China have been growing after Beijing asserted broad new powers to rein in opposition in Hong Kong, pouring cold water over hopes the world's largest economies will patch up relations soured by a lingering trade spat. Stocks in Shanghai powered ahead for a seventh day. Investors have been drawn to China's markets amid efforts by regulators to boost the attractiveness of stocks and hopes for an economic recovery. European shares gave up gains early in the trading session after Hungarian Prime Minister Viktor Orban said regional leaders will probably fail to agree on a massive spending plan aimed at reviving their economies. Negotiations at a summit next week will be "very tough" and will likely need to continue throughout the summer.