Investor focus remains on the counting of ballots in U.S. election
Wall Street stocks rose for a fourth straight session on Thursday despite no closure yet to the presidential contest. The Federal Reserve left its monetary policy unchanged on Thursday and restated its pledge to use all its tools to help the US economy recover from the coronavirus pandemic. The Dow Jones Industrial Average finished up 1.95%, the S&P 500 rose 1.95%, and the tech-heavy Nasdaq jumped 2.59%.
Asian equities were mixed amid protracted vote-counting following the U.S. elections. Investors are betting on control of the U.S. Congress being split between Republicans and Democrats, which implies that low taxes and light regulation will stay in place. The Shanghai Composite Index lost 0.25% while the Nikkei 225 in Japan gained 0.9%. The Hang Seng in Hong Kong was flat, the Kospi in Seoul inched up 0.1% while the S&P/ASX 200 in Sydney advanced 0.8%.
European stocks also opened mixed, with investor focus remaining on the counting of ballots in U.S. elections while rising coronavirus cases and new restrictions across the continent add to concerns in the markets. However, the downside potential could be limited as US futures trim earlier losses to move closer towards flat levels on the session.
In the currency markets, the dollar is keeping little changed overall after a steep sell-off seen on Thursday when the greenback suffered the worst decline since April. EURUSD retains a bullish bias above the 1.18 handle and could extend the rally if positive risk sentiment persists. Fed’s Powell once again struck a fairly dovish tone at the press conference yesterday, and his inclination to additional stimulus is another bout of bad news for the greenback. If the pair fails to hold around the current levels and proceeds to a correction, the key support is expected at 1.1760 where the 20-DMA lies.
