Asia Morning: U.S. Stocks Tumble as Stimulus Hopes Fade
Ming Lam October 20, 2020 10:03 AM
No progress is made toward a stimulus deal agreement between the government and Congress...
On Monday, U.S. stocks closed sharply lower. The Dow Jones Industrial Average slumped 410 points (-1.44%) to 28195, the S&P 500 shed 56 points (-1.63%) to 3426, and the Nasdaq 100 tumbled 217 points (-1.84%) 11634.
Nasdaq 100 Index (Daily Chart) : Consolidation
Sources: GAIN Capital, TradingView
Despite House Speaker Nancy Pelosi calling on the government to reconcile remaining disputes on a fiscal stimulus package within 48 hours, no progress was made toward a deal agreement between the government and Congress.
Technology Hardware & Equipment (-2.27%), Energy (-2.1%) and Software & Services (-2.01%) sectors lost the most. Nordstrom (JWN -5.88%), Gartner (IT -4.41%), Ross Stores (ROST -4.37%) and VF (VFC -4.33%) were top losers.
ConocoPhillips (COP -3.17%) said it has agreed to buy U.S. shale oil producer Concho Resources (CXO -2.76%) for $9.7 billion.
Approximately 75% (74% in the prior session) of stocks in the S&P 500 Index were trading above their 200-day moving average and 81% (83% in the prior session) were trading above their 20-day moving average.
European stocks were broadly lower while trading volumes were greatly reduced by a technical glitch at exchange operator Euronext. The Stoxx Europe 600 Index declined 0.18%, Germany's DAX 30 fell 0.42%, France's CAC 40 eased 0.13%, and the U.K.'s FTSE 100 was down 0.59%.
U.S. Treasury prices posted modest losses, as the benchmark 10-year Treasury yield rose to 0.760% from 0.740% Friday.
Spot gold rose $4 (+0.22%) to $1,903 an ounce.
U.S. WTI crude futures (December) declined $0.06 (-0.20%) to $41.06 a barrel.
On the forex front, the U.S. dollar weakened further against other major currencies, though its loss shrank at the end of the session. The ICE Dollar Index lost 0.27% to 93.43.
The British pound was lifted by the European Union's comments that it was ready to intensify talks with Britain toward a trade deal. GBP/USD once breached the key 1.3000 level before closing at 1.2954, up 0.31% on day.
EUR/USD jumped 0.45% to 1.1769, while USD/JPY was little changed at 105.43.
AUD/USD was down for a fourth session as it dropped 0.1% to 0.7071. China's Gross Domestic Products (GDP) grew 4.9% on year in the third quarter, lower than +5.5% expected.
Meanwhile, the Chinese yuan reached a fresh 18-month high against the dollar, with USD/CNH (offshore yuan) falling 0.26% to 6.6787.
From time to time, StoneX Financial 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.