European equities opened higher but turned mixed soon due to the lingering uncertainty among investors
Wall Street equities finished on a downbeat note overnight amid another slump in tech giants despite US COVID-19 hospitalizations sank to their lowest level in a month. Financial and industrial stocks that lagged behind the tech sector earlier, gained the most. Investors were digesting Russia’s announcement that it had developed and approved the world’s first successful coronavirus vaccine but it did little to inspire investors that preferred to take profit on Tuesday. The S&P 500 lost 0.8%, the Dow Jones Industrial Average dropped 0.4%, and the Nasdaq Composite shed 1.7%.
Stocks were mixed during the Asian hours on Wednesday amid the deadlock in the U.S. Congress over the latest stimulus measures and tensions between the U.S. and China. According to the latest developments on this front, the Chinese foreign ministry reaffirmed that the US’ TikTok ban has nothing to do with national security. The officials also called US sanctions irrational and groundless.
In Europe, equities opened higher but turned mixed soon due to the lingering uncertainty among investors. On the positive side, Liberty Global’s takeover offer for Sunrise Communications fueled gains in telecoms stocks. Meanwhile, London’s FTSE 100 gained 0.75% after a collapse in quarterly economic output that added to bets of stimulus measures. The U.K. economy fell into its deepest recession on record in the second quarter as the GDP contracted by 20.4%.
GBPUSD briefly jumped to the 50-hour SMA around 1.3070 and retreated slightly afterwards, staying marginally higher on the day as the greenback continues to remain afloat after recent gains. Later in the day, the US CPI report could affect USD pairs including the pound. On the downside, the key support is still represented by the 1.30 psychological handle.
Elsewhere, gold prices dipped briefly below the $1,863 level earlier in the day and then regained the bullish momentum and turned positive on the intraday timeframes. The bullion is now back above $1,900 but remains in a corrective mode after the recent rally towards all-time highs around $2,075. It is possible that the precious metal will see a steeper correction before the bulls reemerge.