Macro Roundup (Oct 28)

Published: Oct 28, 2020 08:55 (GMT+8)
The US dollar slipped on Tuesday as investors took some profits after the previous session’s gains that also saw a sell-off in equities, while worries about a second coronavirus wave and uncertainty ahead of the US election persisted.

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

 

The US dollar slipped on Tuesday as investors took some profits after the previous session’s gains that also saw a sell-off in equities, while worries about a second coronavirus wave and uncertainty ahead of the US election persisted.

The greenback fell against the currencies that benefit mostly from higher risk appetite such as the euro, sterling, and commodity-linked currencies rose.

 

On Wall Street, US stock futures fell on Tuesday night following a mixed session in which traders weighed a recent uptick in coronavirus infections.

Dow Jones Industrial Average futures traded 118 points lower, or 0.4%. S&P 500 slid 0.5% and Nasdaq 100 futures dipped 0.4%.

The Dow fell more than 200 points during regular trading and the S&P 500 slipped 0.3%. The Nasdaq Composite, meanwhile, advanced 0.6%. Tuesday’s divergent market action came as names that would benefit from people staying at home — such as Amazon and Zoom Video — rose broadly while stocks dependent on the economy reopening declined.

 

Crude rebounded on Tuesday as companies shut down some US Gulf of Mexico oil production ahead of an approaching storm, although surging coronavirus infections and rising Libyan supply limited gains.

Companies including BP, Chevron, and Equinor ASA evacuated rigs or closed facilities. So far producers have shut 16%, or 294,000 barrels per day (bpd) of oil output due to Zeta, which was a hurricane on Monday but weakened to a tropical storm early on Tuesday, the US National Hurricane Center (NHC) said.

The storm-induced bump in prices may be short-lived, however, with demand expected to weaken anew with coronavirus cases rising.

 

Gold prices edged higher on Tuesday, helped by a weaker dollar and worries over a second surge in coronavirus cases, although the safe-haven metal held a narrow range as investors focus on next week’s US presidential election.

“Gold is stuck in a tight range and there’s probably not going to be too much activity before the U.S. election,” said Michael Matousek, head trader at US Global Investors.

However, people are still carrying bullish bias on gold because of the coronavirus worries, slowdown in global economies and stimulus measures, which is prompting investors to add gold into their portfolios, he added.

 

On the coronavirus front, new record rises in daily Covid-19 cases have been seen in the US, Russia and France in recent days, while the UK is set to extend its highest category alert to more cities and German Chancellor Angela Merkel has warned colleagues that Germany is on the verge of losing control of the virus, according to The Guardian.

 

The White House on Tuesday tamped down expectations for a major coronavirus relief package to be agreed upon by the Nov. 3 US presidential election, saying House of Representatives Speaker Nancy Pelosi was seeking too much.

Democratic challenger Joe Biden leads President Donald Trump in national polls but the race is much tighter in battleground states that determine the election outcome.

 

UK has warned that time is running out as the European Union’s top negotiator Michel Barnier travels to London to continue Brexit talks, with the two sides differing strongly on key issues in their bid to secure a new trading arrangement by year-end.

 

Consumer confidence waned in October, reflecting somewhat less optimism about the jobs market and the US economy in the next six months amid another outbreak of coronavirus cases.

The index of consumer confidence dipped to 100.3 this month from a pandemic high of 101.3 in September, the Conference Board said Tuesday. The decline was slightly bigger than Wall Street expected.

 

US orders for durable goods, items ranging from toasters to aircraft that are meant to last three years or more, jumped 1.9% in September after rising 0.4% in August. Durable goods orders were driven by a 4.1% rebound in orders for transportation equipment, which followed a 0.9% decline in August.

 

Inventory data from the US Energy Information Administration (EIA) will be released today.

 

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