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Stocks drift amid virus jitters, stimulus deadlock: markets wrap

Treasuries and the dollar were steady, while crude oil retreated.
Image: Kiyoshi Ota/Bloomberg

European equity futures edged up while US contracts and Asian stocks were mixed Friday as investors mulled continued talks over American stimulus and the economic impact of fresh restrictions in some nations to curb the pandemic.

Shares slipped in Tokyo and Seoul but climbed in Hong Kong. S&P 500 futures fluctuated after the benchmark came off its session lows as banks rebounded from a two-day selloff and energy shares rallied. Treasuries and the dollar were steady, while crude oil retreated. The yen strengthened.

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President Donald Trump said he is willing to go beyond the $1.8 trillion offer for relief that’s already been put forward, but Senate Majority Leader Mitch McConnell rejected that. Treasury Secretary Steven Mnuchin told Pelosi Trump will personally lobby to get reluctant Senate Republicans behind any stimulus deal they reach.

With fresh US stimulus remaining elusive for now, investors are monitoring clampdowns in Europe’s biggest cities as concern grows that measures aimed at containing the virus’s spread could cause more damage to a fragile global recovery. Data showed an unexpected surge in US jobless claims to the highest since August — a troubling sign for a labour market whose recovery was already slowing.

“We need to take into account the tremendous rally we’ve had over the past five months so some consolidation is certainly warranted,” Jim McDonald, chief investment strategist at Northern Trust, said on Bloomberg TV. “The new risk emerging on the horizon is the increasing cases of Covid that are sweeping across Europe and increasing across the US.”

Friday brings the expiry of options contracts on U.S. equities, indexes and exchange-traded funds, lifting the chances for intraday volatility.

Here are some key events coming up:

  • European Central Bank President Christine Lagarde leads off the virtual annual meetings of the International Monetary Fund and the World Bank Group. through October 18.

These are some of the main moves in markets:

Stocks

  • S&P 500 futures were little changed as of 7:01 a.m. in London. The index decreased 0.2% on Thursday.
  • Japan’s Topix index dipped 0.9%.
  • Hong Kong’s Hang Seng added 1.1%.
  • South Korea’s Kospi lost 0.7%.
  • Shanghai Composite rose 0.1%.
  • Australia’s S&P/ASX 200 Index fell 0.5%.
  • Euro Stoxx 50 futures rose 0.7%.

Currencies

  • The Bloomberg Dollar Spot Index was flat.
  • The euro was little changed at $1.1706.
  • The yen rose 0.2% to 105.24 per dollar.
  • The offshore yuan was little changed at 6.7119 per dollar.

Bonds

  • The yield on 10-year Treasuries dipped to 0.72%.
  • Australia’s 10-year yield fell about five basis points to 0.72%.

Commodities

  • West Texas Intermediate crude decreased 0.9% to $40.61 a barrel.
  • Gold slid 0.1% to $1,906.46 an ounce.
© 2020 Bloomberg

COMMENTS   1

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Markets are not driven by fundamentals… whats the point of investing???

Look at MTN and Aspen … good results but the shares are falling.

Must be rigged!

End of comments.

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