Global Fundamental Analysis 21/10/2020

Global Fundamental Analysis 21/10/2020, FP Markets

OPENING CALL: The Australian share market is to open higher.

U.S. stocks closed higher ahead of stimulus talks deadline. The 10-year Treasury note yield ticked up to 0.796%, from 0.760% on Monday. The WSJ Dollar Index recently was down 0.18% to 88.26. Crude oil prices ended near the session’s highs. Gold futures scored back-to-back gains, settling at their highest in more than a week.

Australian Market

Australia’s S&P/ASX 200 index ended the session down 0.7% to 6184.6 after U.S. stocks wobbled amid pessimism over prospects for further coronavirus stimulus. The heavyweight financial and materials sectors led losses as the benchmark S&P/ASX 200 index retreated from its best close for seven months.

US Market

U.S. stocks finished higher on optimism that Congress would reach an agreement on a spending package to support American households and businesses through the pandemic.

The S&P 500 added 0.5%, taking back some of its losses from earlier in the week. The broad-market index fell 1.6% Monday as investors grew concerned that lawmakers weren’t making progress on a deal. The Dow Jones Industrial Average, meanwhile, rose 0.4%. The tech-heavy Nasdaq Composite Index advanced 0.3%. All three major U.S. indexes were higher earlier in the session.

Commodities

Gold futures ended with back-to-back session gains, with weakness in the U.S. dollar helping to lift prices to their highest settlement in just over a week.

December gold for delivery on Comex was up $3.70, or 0.2%, to settle at $1,915.40 announce, following a 0.3% gain on Monday. The settlement was the highest for a most-active contract since Oct. 12, according to FactSet data. Copper futures, meanwhile, settled at their highest in more than two years, amid signs of strengthening demand from China.

Oil Futures

Oil futures shook off early declines to finish near the session’s highest levels.

West Texas Intermediate crude for November, which expired at the end of the day’s session, rose 63 cents, or 1.5%, to end at $41.46 a barrel on the New York Mercantile Exchange. December WTI crude, the new front-month contract, tacked on 64 cents, or 1.6%, to settle at $41.70.

Forex

Major currencies were stronger against the US dollar in European and US trade. The Euro rose from lows near US$1.1761 to highs near US$1.1839 and was near US$1.1825 at the US close. The Aussie dollar rose from lows near US70.20 cents to highs near US70.72 cents and was near US70.55 cents at the US close. And the Japanese yen rose from 105.74 yen per US dollar to JPY105.41 and was near JPY105.45 at the US close.

European Markets

European sharemarkets fell on Tuesday as Italy, Spain and Britain imposed renewed virus restrictions. An impasse on Brexit trade talks also dented sentiment. UBS shares rose by 2.7% as it posted a 99% jump in quarterly profit. Computer equipment maker Logitech (+15.8%) reported a 75% jump in second-quarter sales. The pan-European STOXX 600 index fell by 0.4%. The German Dax index lost 0.9%. But the UK FTSE index rose 0.1%. In London trade, shares of Rio Tinto (-0.4%) and BHP (-0.04%) both fell.

Asian Markets

Japanese stocks closed lower, dragged by falls in railway and auto stocks, amid continuing uncertainty over the pace of an economic recovery from the Covid-19 pandemic.

China’s major stock benchmarks closed higher, as the market recovered from the previous day’s losses. The benchmark Shanghai Composite Index rose 0.5% to settle at 3328.10, after suffering its steepest one-day percentage decline so far this month in the past session. The Shenzhen Composite Index grew 1.3% to 2279.38 while the ChiNext Price Index, a measure for emerging industries and start-ups, added 1.9% to 2740.58.

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