Relief Aid Seems a World Away
The US index advanced 0.26% higher on Monday, settling just above the 93 handle.
Fading stimulus prospects and continued pandemic fears shifted appetite back to the dollar. USD price action is strengthening amid intensifying uncertainty around the upcoming election.
In addition, traders expressed concerns with US lawmakers over further relief aid. This saw a basket of the main indices drop in yesterday’s session, with the Dow being the biggest casualty as it dropped over 2%.
Meanwhile, the S&P 500 and Nasdaq Composite sank 1.8% and 1.6%, respectively. It marked the worst day since September for both.
WHO Reveals More Detrimental Figures
The euro closed 0.38% lower yesterday as more bleak news against the eurozone came to light.
The stronger greenback did not help as the pandemic infection numbers keep increasing, dampening investor sentiment as further restrictions take effect.
Data from the World Health Organization indicates that Europe recorded 1.3 million new cases last week, the region’s highest-ever weekly figure.
The risk-off sentiment was also reflected on the German Dax which fell over 2% on Monday.
Sterling Holds Above 1.30
The pound fell for the third straight session as it closed 0.25% lower yesterday.
GBPUSD has been on the back foot due to the rising UK and US coronavirus cases. However, bulls are lying in wait amid fresh Brexit optimism.
Michel Barnier, the EU’s Chief Brexit Negotiator, has extended his stay in the British capital for further talks. This development is seen as a sign that weekend talks were productive and that the 1.30 handle can be maintained.
Gold Mutes As Houses Yield Little Progress
Gold closed indecisively on Monday but managed to remain elevated above the $1900 handle.
The ongoing stalemate with congress saw the yellow metal remain muted, as the Democrats and Republicans blame each other for the lack of fiscal stimulus progress.
It looks all but impossible that Congress could send new aid to Americans before November’s Election Day.
WTI Slips As Libya Ramps Up Oil Production
Oil fell over 2% yesterday over news that Libya looks to bring back one million bpd.
The commodity plunged below $39 as a worsening demand outlook is coinciding with Libya’s push to almost double crude output, as it reopened its last major oil field.
The ever increasing lockdowns across Europe and other continents show that oil is still in for a rough ride.