Before the new
week's start, the U.S. President Donald Trump severed the Gordian knot of
lingering long negotiations in Congress on the pandemic relief package. He has
taken the situation out of the impasse and decided to avoid all the "checkpoints"
by signing a series of presidential executive orders. The extension of
unemployment benefits is a life tube for the tens of millions of Americans and
the new payroll tax cut bill pours the additional money directly into the
employees' pockets providing more social security.
Today, market sentiment is one of risk
aversion. European stocks face another cautious session with rising
US-China tensions and no progress in negotiations on the new US stimulus
The Dollar regains some of the ground lost
on Thursday, with the currency's DXY index trading again above
93.00. Traders are likely to take a cautious approach to
currency risk ahead of the US-China trade talks on 15 August.
100 futures for the U.S. hi-tech sector composite index reached a new all-time
high again last night. This time the quotes touched the 11290 points area after
the previous high around 11155 just on Tuesday. While many experts from various
investment funds are continuing to talk on whether a "V-shape"
recovery would take place, or maybe not, in the U.S. or global economy, major
U.S. financial indexes have finished drawing their right half of the same
"V-letter" on charts.
Today, the market sentiment is one of risk aversion. There are no signs of progress in the negotiations on the aid plan for the coronavirus in the United States, and US Secretary of State Mike Pompeo said the White House could ban other Chinese applications that it considers to jeopardise the country's national security.
The Dollar traded on the defensive during the Asian session on Thursday, as investor optimism about the approval of new fiscal stimulus in Washington seemed to decline, which reduces the currency's attractiveness.
corporate earnings for the second quarter of 2020 were expected to drop 33.8%
compared to the similar period a year ago, according to preliminary figures by
Refinitiv, a global provider of financial market data jointly owned by
Blackstone Group and Thomson Reuters. But the same Refinitiv calculated that
82.1% of companies have reported above analyst expectations, at least among 312
companies in the S&P 500 broad market list that reported their financial
results before July 31.
European stocks started higher today and are continuing to hold the gains,
thanks to the successful recovery of initial losses by the end of all trading
sessions on Tuesday, and also because of the fresh summer record for the U.S.
broad market S&P500 index futures above 3325, where it stood on midday Wednesday.
Some positive earning reports in Europe fuelled the movement as even the travel
and leisure sectors, which are considered to be the most exposed to the
corona-related restrictions, led the morning surge.
inflation in developed economies have become a curse since the Great financial
crisis of 2008. It discourages producers, as inconsiderable rise of prices
means low demand and difficulties in sales. Thus, the growth of the economy is
also under threat. Developed economies have been struggling for several years
to meet the inflation target of two % and yet have hardly succeeded in it.
quantitive easing programs and lowering interest rates throughout the globe have
been tailored to meet this ultimate goal. Such efforts were made consistently by
market sentiment is an appetite for risk. News that the United States and China
will meet to discuss trade and expectations of progress in negotiations in
Washington over a stimulus package are driving the current positive sentiment
in the market.
retreated in the Asian session on Wednesday, following up on the previous day's
losses, with more bets that the US Federal Reserve will ease monetary policy
further and with investors attentive to negotiations in the US Congress on new
market sentiment is relatively mixed. Democratic leaders and White House
officials seem cautiously optimistic after another round of talks on Monday
about the new coronavirus aid package, under increasing pressure to reach an agreement
since millions of Americans are living without the $600 a week unemployment
benefit supplement, and U.S. President Donald Trump has launched potential
gained ground on the Yen this Tuesday in Asia, after robust economic data has
increased risk appetite by putting the Yen under pressure as a safe asset.
to be like a nice day for a short lull in the market battle, as only the
Business Condition survey among firms in the New York City area is going to be
published during today's trading session. There are no more noticeable macro
reports that could be highly appreciated by the investment community. The
Johnson's Redbook Index will come later, which is just same-store sale figures
in a sample of large U.S. merchandise retailers representing about 9,000