Macro Roundup (Sep 28)

SHANGHAI, Sep 28 (SMM) — This is a roundup of global macroeconomic news last night and what is expected today.

The dollar gained ground on Friday and measured its biggest weekly gain since early April as investors worried about a slowing economic recovery, rising coronavirus infections in Europe, uncertainty about US stimulus, and the upcoming US elections.

While orders for key US capital goods increased more than expected in August, orders for durable goods - ranging from toasters to aircraft that are meant to last three years or more - rose 0.4% in August after jumping 11.7% in July.

Top Republicans on Thursday repudiated President Donald Trump’s refusal to commit to a peaceful transfer of power after Trump, also a Republican, said Wednesday that he expects the election result to end up being settled by the Supreme Court.

Oil slipped on Friday and was on track for a more than 2% weekly decline due to mounting worries about resurgent coronavirus infections crushing fuel demand and as Libyan crude exports resume.

“There’s a lid on this market to the extent that COVID-19 keeps rearing its ugly head in different spots,” said John Kilduff, Partner at Again Capital in New York. “We just can’t get this demand perked back up.”

In the world’s top oil consumer the United States, infections were rising in the Midwest, while New York City, which was hit hardest in the spring, is considering renewed shutdown mandates. More than 200,000 people have died of the virus in the nation. US fuel consumption remains sluggish as the pandemic constrains travel and hampers economic recovery. The four-week average of gasoline demand last week was 9% below a year earlier. The US oil and gas rig count, an early indicator of future output, rose six to 261 in the week to Sept. 25, energy services firm Baker Hughes Co said.

Libya has recently boosted production and Shell has provisionally booked the first crude tanker to load at Libya’s Zueitina terminal since January.

On Wall Street, the S&P 500 and the 30-stock Dow were coming off their fourth straight negative week, shedding 0.6% and 1.8%, respectively. It marked the first time since August 2019 that the two benchmarks suffered a four-week losing streak. The tech-heavy Nasdaq eked out a 1% gain last week, posting its first positive week in four as the technology sector rebounded slightly from the recent deep rout.

Investors continue to monitor the developments on further fiscal stimulus after negotiations between House Democrats and the Trump administration fell apart in early August.

House Speaker Nancy Pelosi said Sunday a last-minute coronavirus aid deal remains on the table as House Democrats try to forge ahead on a smaller aid package costing about $2.4 trillion. The chamber could vote on the bill as soon as next week.

Meanwhile on Saturday, President Donald Trump announced that he will nominate Judge Amy Coney Barrett to fill the vacancy left by the death of Justice Ruth Bader Ginsburg on the Supreme Court.

The move sets up a confirmation fight just weeks before Election Day. Hearings to consider Trump’s nominee are set to begin Oct. 12, Senator Lindsey Graham said late Saturday.

Gold fell on Friday, hovering near last session’s over two-month low, as investors sought shelter in the dollar from rising coronavirus cases and uncertainties over the next US stimulus to aid the economy.

China’s industrial profits rose 19.1% in August, the country’s National Bureau of Statistics announced over the weekend. Chinese economic data has been watched by investors for signs of the country’s continued recovery from the coronavirus pandemic.

German import price index and August retail sales and US Dallas Fed Manufacturing Business Index for September are set for release today.