Following Monday’s aggressive rally, US stocks finished lower overnight after a report cast doubt on Moderna’s coronavirus vaccine candidate. In his testimony before the Senate Banking Committee, Treasury Secretary Steven Mnuchin said that the government is “fully prepared to take losses” on coronavirus business bailouts. The Dow Jones Industrial Average fell 1.6%, the S&P 500 index shed 1.1%, while the Nasdaq Composite Index declined 0.5%.
In Asia, stocks saw mixed dynamics on Wednesday, as markets struggled to extend the recent rally amid dented hopes for a COVID-19 vaccine and the renewed concerns about the global recovery after fresh data showed that Japanese business confidence slumped to a ten-year low while Australian retail sales suffered their steepest ever plunge last month.
European stock markets opened lower today as investors weighed conflicting signals on the outlook for the global economy and markets. In part, investor sentiment has deteriorated as critics said the proposed 500 billion-euro fiscal-stimulus plan is too little and too late to counter the devastating effect on the region’s economies. The Stoxx Europe 600 Index is trading just 0.11% higher on the day.
Elsewhere, the euro retains its bullish bias despite risk demand has been waning on Wednesday. Still, EURUSD struggles to overcome the 100-DMA while the 50-DMA now acts as the immediate support. On the data front, Eurostat reported that the Eurozone consumer prices came in at +0.3% on a yearly basis last month, missing the flash estimate of +0.4 and +0.4% expectations. The core CPI arrived at 0.9%, in line with expectations.
In other markets, bitcoin price remains below the $10,000 handle, struggling to make a decisive break above the $9,900 area. There are now two possible scenarios for the number one digital currency – the prices will either break the above mentioned psychological level, or will proceed to a downside correction. Anyway, the short-term technical picture looks fairly positive at this stage but failure to exceed the important barrier could fuel profit-taking.