On the negative side, the number of virus cases globally has topped 35 million as of October 5
Wall Street’s main indexes tumbled on Friday, dragged down by US President Donald Trump’s positive COVID-19 test just weeks before the election. Energy stocks slid 1.5% on the back of a more than 3% drop in oil prices. However, equities managed to trim intraday losses by the end of the session. The Dow Jones Industrial Average closed 0.5% lower, the S&P 500 slid 1.0%, and the Nasdaq Composite declined 2.2%.
Asian stocks were up on Monday amid the news that Trump was recovering well and could be discharged as early as today. While being in the hospital, US President tweeted his wish for the U.S. Congress to reach an agreement on the latest stimulus package. On the negative side, the number of virus cases globally has topped 35 million as of October 5. Japan’s Nikkei 225 rose 1.23%, South Korea’s Kospi gained 1.29%, Australia’s ASX 200 jumped 2.59%. Chinese markets were closed for a holiday.
European equities opened higher on Monday, lifted by positive updates of U.S. President Donald Trump’s health and stimulus hopes after House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin consulted Federal Reserve Chair Jerome Powell about their stimulus plan talks. On Tuesday, U.S. Federal Reserve Chairman Jerome Powell and European Central Bank chief economist Philip Lane will deliver keynote addresses during the upcoming NABE conference.
Meanwhile, the Japanese yen is on the back foot on Monday amid a recovery in positive risk sentiment. USDJPY rose above 105.00, having exceeded the 20-DMA during the Asian hours and continues to point to further recovery along with risky assets amid upbeat news on Trump’s health. At the same time, the greenback is down versus other major counterparts amid the lingering political uncertainty ahead of the upcoming election.
In other markets, Brent crude bounced from more than three-month lows and rose above the $40 handle on Monday amid the overall improvement in sentiment. However, the current recovery looks fragile and could wane at any point, as concerns over the outlook for demand recovery continue to persist.