Asia Morning: U.S. Stocks Climber Higher, Dollar Weaker

On Wednesday, U.S. stocks ended again in positive territory, led by blue-chip stocks...

Trading floor 2

On Wednesday, U.S. stocks ended again in positive territory, led by blue-chip stocks. The Dow Jones Industrial Average jumped 373 points (+1.39%) to 27201, the S&P 500 gained 21 points (+0.64%) to 3327, and the Nasdaq 100 was up 28 points (+0.26%) 11125, a fresh record high.

Dow Jones Industrial Average: Daily Chart

Source: GAIN Capital, TradingView

Market sentiment was held up by news on COVID-19 vaccine development and lawmakers working towards concluding a new economic relief package.

Consumer Durables & Apparel (+2.94%), Capital Goods (+2.46%)and Automobiles & Components (+2.4%) sectors performed the best. Airline stocks - American Airlines (AAL +9.5%), United Airlines (UAL +4.46%) and Delta Air Lines (DAL +3.12%) - were among the top gainers. Walt Disney (DIS +8.8%) rose after releasing 3Q results. 

Regarding U.S. economic data, the Automatic Data Processing (ADP) jobs report showed a gain of only 167,000 private jobs in July, well below an addition of 1.2 million jobs expected. The ISM Services Index increased to 58.1 in July (55.0 expected). Trade deficit narrowed to 50.7 billion dollars in June from 54.8 billion dollars in May.

Due later today is a report on Initial Jobless Claims (an increase to 1.4 million for the week ended August 1 expected).

European stocks were broadly higher. The Stoxx Europe 600 Index rose 0.49%, Germany's DAX 30 climbed 0.47%, France's CAC 40 gained 0.90%, and the U.K.'s FTSE 100 jumped 1.14%.

The benchmark U.S. 10-year Treasury yield stepped up to 0.549% from 0.520% Tuesday.

Spot gold price showed no signs of fatigue after conquering the key level of $2,000 an ounce, advancing $18.00 to $2,038. Meanwhile, Spot Silver price jumped 3.6% to $26.94 an ounce.

Oil prices increased after the U.S. Energy Information Administration (EIA) reported a surprise reduction of 7.4 million barrels in crude-oil stockpiles. U.S. WTI crude oil futures (September) gained 1.2% to $42.19 a barrel.

On the forex front, the U.S. dollar weakened further as general risk sentiment improved. The ICE U.S. Dollar Index lost the 93.00 level again.

EUR/USD rebounded for a second day rising 0.5% to 1.1863. Short positions on the euros should have been squeezed.

GBP/USD crossed above the 1.3100 level.

Official data showed that Retail Sales in the Eurozone grew 5.7% on month in June (+5.9% expected).

In Europe, July Markit Services PMI (final reading) for the Eurozone posted at 54.7 (vs 55.1 expected), Germany at 55.6 (vs 56.7 expected), France at 57.3 (vs 57.8 expected) and the U.K. at 56.5 (vs 56.6 expected). 

USD/JPY remained under pressure closing at 105.60.

AUD/USD added 0.4% to 0.7191.

USD/CAD dipped below the key level of 1.3300 closing at 1.3266 extending its losing streak to a fourth session. 

More from Commodities

From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.