U.S. equity futures also inching higher ahead of retail sales data
US stocks finished marginally lower overnight, as equities managed to trim earlier losses but failed to reenter the positive territory amid waning stimulus hopes and bearish jobless claims data. The Labor Department said that the number of Americans seeking unemployment benefits rose last week to 898,000, exceeding forecasts. As a result, the S&P 500 fell 0.2%, the Dow Jones Industrial Average dropped 0.1% and the Nasdaq Composite dropped 0.5%.
Asian stocks were mixed-to-negative on Friday, struggling to regain bullish momentum as resurgence of coronavirus infections in Europe and the United States hurt risk appetite. Also, many investors still believe a deal is unlikely before the November 3 election despite Trump’s offer on Thursday to raise the size of a fiscal stimulus package. Japan’s benchmark Nikkei 225 dipped 0.4%, Australia’s S&P/ASX 200 shed 0.53% while Hong Kong’s Hang Seng gained 1.0%, and the Shanghai Composite added 0.12%.
In Europe, equities opened higher in a sign of some improvement in investor sentiment with U.S. equity futures also inching higher ahead of retail sales data. In Europe, a more upbeat sentiment was due to positive results from LVMH and Daimler. Still, the rapid spread of coronavirus through the continent remains on investors’ radar, capping bullish potential in the markets. The pan-European Stoxx 600 climbed 0.8% in early trade.
Meanwhile, the dollar retreats marginally after the recent rally amid risk aversion. However, EURUSD continues to struggle around the 1.17 handle, refraining from a recovery above the 20-DMA. Should US retail sales data come in better than expected, risk sentiment will continue to improve. In this scenario, the pair could stage a more robust recovery. Anyway, the upside potential remains limited amid rising coronavirus cases in Europe these days. On the downside, the common currency needs to hold above the 1.1685 support to avoid deeper losses in case of resurgent risk aversion.