The surge in coronavirus cases globally make investors worried about the outlook for the economic recovery
Wall Street stocks finished higher on Friday despite a jobs report showed that the U.S. economy lost 140,000 jobs in December, well below forecasts for a gain of 55,000. The Dow Jones Industrial Average closed up 0.2%, the S&P 500 index added 0.55%, and the Nasdaq Composite Index rose 1.03%. For the week, the Dow gained 1.6%, the S&P 500 rose 1.8%, and the Nasdaq Composite added 2.4%.
Today in Asia, equities were mostly lower along with U.S. equity futures as investors proceeded to profit-taking following the recent rally. However, the downside pressure was limited as Biden said he’ll lay out proposals this week for trillions of dollars in fiscal support. As such, South Korea’s Kospi shed 0.12%, Australia’s S&P/ASX 200 lost 0.90%, Hong Kong’s Hang Seng edged up 0.11%, while the Shanghai Composite lost 1.08%. Japanese markets were closed for a national holiday.
European stocks opened lower on Monday, with the pan-European Stoxx 600 slipping 0.2% as a surge in coronavirus cases globally make investors worried about the outlook for the economic recovery while a downside correction in the oil market adds to the downbeat tone at the start of the week.
Meanwhile, the dollar climbed a third day against major peers, sending EURUSD below the significant 20-DMA for the first time in over two months. The euro is now below the 1.2200 figure, off fresh long-term highs registered around 1.2350 last week. if the selling pressure persists in the short term, the 1.2130 support zone will come into market focus next.
As for other markets, oil prices retreat following four days of gains in a row. However, the correction looks limited so far as the futures managed to hold above the $55 figure and trimmed earlier losses. On the negative side, surging demand for the greenback along with risk aversion could keep Brent under some pressure in the immediate term.