Asian shares fell on Thursday and the dollar rose slightly as investors bitten by the slow US talks and a surge in global case Covid-19. Fell in Asia is likely to continue in Europe, putting European shares on track for a fourth straight session in the red.
In early European trade, pan-regional Euro Stoxx 50 futures STXEc1 fell 0.5%, Germany’s DAX futures FDXc1 FTSE shed 0.52% and FFIc1 futures slipped 0.39% to 5,722.5
Global investor sentiment has taken a fresh hit after US President Donald Trump accused Democrats on Wednesday to not be willing to craft a compromise that is acceptable to the fresh stimulus, following a progress report on the previous day.
It remains unclear whether the stimulus negotiations will continue towards the US presidential and congressional elections on November 3
“We still think that this agreement will remain elusive in the sense that this amount we are talking about, $ 1.88 trillion, that about 9% of GDP, and 2.2 trillion, which is a package of Speaker Pelosi, even higher at about 10% of GDP, “said Anthony Chan, chief Asian investment strategy at Union Bancaire Privee (UBP) in Hong Kong.
“Even if the two sides reached an agreement, given the tight deadlines ahead of the elections was not possible that something like that would be able to pass through the Senate smoothly.”
the broader MSCI Asia Pacific shares outside Japan .MIAPJ0000PUS was down 0.31% while the Nikkei .N225 was 0.66% lower.
Australian shares .AXJO dropped 0.29%, the Kospi .KS11 Seoul was 0.87% and Chinese blue chips .CSI300 lost 0.53%.
Uncertainty about the passage of a bill to boost an economy ravaged by the pandemic is that the United States faces a new wave of Covid-19 case.
Nearly two-thirds of American States were in a danger zone propagation coronavirus and six, including the election of Wisconsin battlefield, reported a record increase in day-Covid 19 deaths Wednesday.
In this context, three major averages closed on Wednesday after less than a choppy trading session on Wall Street.
The Dow Jones Industrial Average DJI inched 0.35% lower, while 500 lost 0.22% SPX S & P. The technology heavy Nasdaq Composite .IXIC fell 0.28%.
On Thursday, the dollar was 0.1% higher against the yen at 104.66 JPY=, while the euro EUR= notched down 0.12% to $1.1847.
But against a basket of major peers, the dollar =USD appeared relatively unaffected by setbacks to stimulus talks, trading only slightly higher at 92.736, steadying after touching a seven-week low.
“Markets are now pricing in a strong likelihood of a Biden Presidency perhaps even a clean sweep of Congress, and this is weighing on the USD, as they view a less confrontational trade environment. They will also probably be factoring in a large fiscal stimulus early next year, with none of the hold up that is currently preventing a deal,” Rob Carnell, chief economist at ING in Singapore said in a note.
The yield on benchmark U.S. 10-year Treasury notes US10YT=RR ticked down to 0.8092% from a U.S. close of 0.816% on Wednesday.
In commodity markets, oil prices extended sharp losses overnight, after higher U.S. gasoline inventories pointed to deteriorating fuel demand as coronavirus cases soar.[EIA/S]
U.S. West Texas Intermediate (WTI) crude CLc1 futures fell 0.37% to $39.88 a barrel and Brent crude LCOc1 futures were 0.31% lower at $41.60.
Gold eased as the dollar edged up, with spot gold XAU= down 0.52% at 1,914.56 per ounce. [GOL/]