Asia Morning: U.S. Stocks Get Sold
Ming Lam October 27, 2020 12:18 PM
Investors are deeply concerned with spiking new COVID-19 cases in the U.S. and Europe...
On Monday, U.S. stocks encountered a sell-off. The Dow Jones Industrial Average tumbled 650 points (-2.29%) to 27685, the S&P 500 shed 64 points (-1.86%) to 3401, and the Nasdaq 100 sank 188 points (-1.61%) to 11504.
S&P 500 Index (Daily Chart) : Caution
Sources: GAIN Capital, TradingView
Investors were deeply concerned with spiking new COVID-19 cases in the U.S. and Europe. Spain announced plans to introduce a curfew due to the reviving pandemic. Meanwhile, U.S. Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi failed again to agree on a fiscal stimulus deal.
Energy (-3.47%), Software & Services (-2.95%) and Consumer Services (-2.64%) sectors performed the worst. Energy stocks -- such as Apache (APA -7.76%), ConocoPhillips (COP -6.82%) and Devon Energy (DVN -5.88%) -- were top losers as oil prices slid over 3%.
Boeing (BA -3.9%), Caterpillar (CAT -3.20%) and American Express (AXP -4.04%) also fell.
Approximately 75% (74% in the prior session) of stocks in the S&P 500 Index were trading above their 200-day moving average and 68% (67% in the prior session) were trading above their 20-day moving average.
The VIX Index, Wall Street's fear gauge, jumped 4.91pts (+17.82%) to 32.46.
European stocks were also deeply in the red. The Stoxx Europe 600 Index dropped 1.81%, Germany's DAX 30 plunged 3.71%, France's CAC 40 lost 1.90% and the U.K.'s FTSE 100 was down 1.16%.
U.S. Treasury prices climbed further, as the benchmark 10-year Treasury yield declined to 0.799% from 0.840% Friday.
Spot gold edged down $0.5 to $1,901 an ounce.
Oil prices ended sharply lower, pressured by worries over lower oil demand due to the coronavirus pandemic and over excess oil supplies from Libya. U.S. WTI crude futures (December) dropped $1.29 (-3.24%) to $38.56 a barrel.
On the forex front, the U.S. dollar outperformed other major currencies, as investors turned to safe-haven assets amid a sell-off in stocks. The ICE Dollar Index gained 0.33% to 93.07.
EUR/USD dropped 0.46% to 1.1809. Germany's IFO Business Climate Index declined to 92.7 in October (93.0 expected).
GBP/USD declined 0.12% to 1.3025 posting a four-session losing streak.
USD/JPY stepped up to 104.83 from 104.73 in the prior session.
The Canadian dollar weakened against the greenback amid sliding oil prices. USD/CAD jumped 0.66% to 1.3212, back above its 20-day moving average.
AUD/USD retreated 0.24% to 0.7123, still below its 20-day moving average.
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.