SHANGHAI, Aug 6 (SMM) — This is a roundup of global macroeconomic news last night and what is expected today.
Gold prices rocketed to a new record high on Wednesday after smashing past $2,000 for the first time, as a weaker dollar and falling returns on U.S. bonds drove investors to hoard the safe-haven metal.
Gold has soared 34% this year and is one of 2020′s best performing assets, with investors buying vast amounts in the hope it will hold its value as the coronavirus pandemic upends markets. Breaking above $2,000 for the first time on Tuesday and hitting a new high of $2,055.10 an ounce earlier on Wednesday, spot gold was up 1% at $2,037.81.
On the Wall Street, stocks rose on Wednesday on the back of strong Disney earnings and coronavirus vaccine hopes as the broader market approached reached record levels set earlier this year. The S&P 500 advanced 0.6% to 3,327.77 and the Nasdaq Composite climbed 0.4% to 10,998.40. The Nasdaq briefly broke above 11,000 for the first time and posted a six-day winning streak. The S&P 500 closed higher for a fourth straight day. The Dow Jones Industrial Average also posted a four-day winning streak, rallying 373.05 points, or 1.4%, to 27,201.52.
The dollar was under pressure on Wednesday from a towering euro and crumbling US yields, as the latest coronavirus relief package got bogged down in Congress and investors braced for a bumpy ride to economic repair.
Oil prices rose to their highest since early March on Wednesday after a large decline in US crude inventories and the dollar weakened, but mounting coronavirus infections had investors worried about the demand outlook.
US crude inventories fell by 7.4 million barrels in the week ended July 31, according to data from Energy Information Administration (EIA).
On the coronavirus front, deaths caused by the virus surpassed 700,000 globally on Wednesday, with the United States, Brazil, India and Mexico leading the rise in fatalities.
The Trump administration wants to remove “untrusted” Chinese tech apps like TikTok and WeChat from U.S. app stores, Secretary of State Mike Pompeo announced on Wednesday, detailing a new five-pronged “Clean Network” effort aimed at curbing potential national security risks.
“With parent companies based in China, apps like TikTok and WeChat and others, are significant threats to personal data of American citizens, not to mention tools for Chinese Communist Party content censorship,” Pompeo said during a press briefing.
The White House threatened to act on its own to provide coronavirus relief Wednesday after another day of talks with Democrats yielded no agreement. Though the Trump administration apparently yielded ground in bargaining over extended unemployment insurance, a range of issues remained unresolved Wednesday after officials’ latest meeting with Democratic leaders. Leaving a roughly two-hour huddle with House Speaker Nancy Pelosi, Senate Minority Leader Chuck Schumer and Treasury Secretary Steven Mnuchin, White House chief of staff Mark Meadows told reporters the sides had “no agreement.”
On the SHFE, nonferrous metals, except for aluminium, cruised higher in overnight trading. Copper added 0.27%, zinc jumped 1.48%, lead rose 1.45%, nickel surged 1.68% and tin edged up 0.1%, while aluminium sank 1.29%.
Their counterparts on the LME performed similarly. Copper advanced 0.56%, zinc surged 2.15%, lead jumped 1.81%, nickel soared 2.04% and tin rose 0.62%, while aluminium shed 0.42%.
US Automatic Data Processing (ADP) employment increased by 167,000 for July, missing expectations.
Key economic data including the UK central bank interest rate decision and total asset purchases as of August 6 and US claims for unemployment benefits in the week ended August 1 will be released today.
