Democrats in the House of Representatives working on a $2.2-trillion coronavirus stimulus package
Wall Street stocks rose slightly overnight driven by a recovery in tech stocks while investors weighed the latest series of economic data as the initial claims for state unemployment benefits totaled 870,000 for the week ended September 19 versus 850,000 expected. Meanwhile, the Census Bureau reported that new home sales in the U.S. totaled just over 1 million in August versus 898,000 expected. As a result, the Dow Jones closed 0.2% higher, the S&P 500 was up 0.3%, and the Nasdaq Composite advanced 0.4%. Apple and Microsoft gained over 1% both, to lead tech stocks higher.
Asian stocks were mixed on Friday, steadying amid the reports about more U.S. fiscal stimulus, with Democrats in the House of Representatives working on a $2.2-trillion coronavirus stimulus package that could be voted on next week. Still, lingering concerns about a second round of COVID-19 infections continued to weigh on investor sentiment. MSCI’s broadest index of Asia-Pacific shares outside Japan was 1.8% lower on Friday.
In Europe, equities opened mixed but turned negative in recent trading, struggling to stage a recovery amid soaring pandemic cases in the region. Governments in the U.K. and France have introduced new measures to battle climbing cases, while Spain has faced a massive outbreak in its Madrid region. As of writing, the Stoxx Europe 600 was 0.1% lower after closing down 1% on Thursday.
Meanwhile, the dollar is nearly unchanged, with most currency pairs being directionless on Friday. EURUSD came off two-month lows seen yesterday around 1.1625 but still below the 1.17 figure that acts as the immediate resistance now. EURUSD could resume the decline should risk aversion reemerges in the short term, which could add to weekly losses in the pair.
Elsewhere, gold prices derived support from the 100-DMA during the recent sell-off and made recovery attempts. The precious metal struggles around $1,875, with downside risks persisting as dollar demand continues to cap bullish potential in the gold market. On the downside, the immediate support arrives at $1,855.