Wall Street stocks advanced overnight amid further signs of economic recovery while spreading protests over the killing of George Floyd capped market gains. U.S. manufacturing activity rose in May for the first time in four months which gave a boost to the tech-heavy Nasdaq Composite. The index gained 0.66% on Monday. The S&P 500 Index rose 0.4% at the close of trading. Earlier in the session, stocks declined following reports that Chinese officials had told agricultural companies to pause purchases of some U.S. farm goods.
Today in Asia, stocks made cautious gains as investors expressed some worries about U.S.-China relations and the depth of economic damage. Investor optimism was also capped by U.S. President Donald Trump’s vow to use force to end violent protests in American cities. On the positive side, the prospects of a global coronavirus recovery continued to support risky assets.
European equities opened higher on Tuesday, with the ongoing protests in the US are more reflected in US futures that have settled in the negative territory. Returning from the long weekend, Germany’s DAX 30 is outperforming its counterparts, rallying nearly 3.5%. In general, heightened tensions between the U.S. and China and civil unrest in Hong Kong and the U.S are holding bulls in check.
Meanwhile, the dollar is mostly lower amid the prevailing risk-on sentiment. After some corrective attempts, EURUSD resumed the ascent and registered fresh mid-March highs around 1.1170. A break above this level will open the way towards the 1.12 handle. GBPUSD has climbed to the 100-DMA for the first time since late-April. A daily close above the 1.25 level will confirm the latest breakout.
Elsewhere, oil prices have exceeded the $39 handle in recent trading, targeting the $40 psychological barrier. Brent crude is inspired by hopes for the OPEC+ deal prolongation later this week while expectations of a more robust economic recovery add to market optimism. Also, the prices are supported by a weaker dollar. Should the futures continue the rally, the $40 handle and the 100-DMA at $40.85 may act as resistance levels.
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