Biden’s Democrats planning to move ahead without Republican help on a stimulus plan
Wall Street stocks finished mostly lower overnight, breaking a six-day winning streak, with the major indexes retreating from record highs. Investors continued to monitor stimulus negotiations, with President Joe Biden’s Democrats planning to move ahead without Republican help on a stimulus plan. On the data front, the NFIB business optimism index decreased to 95.0 in January from 95.9 while the December job openings came in at 6.646 million, down from 6.572 million. As such, the S&P 500 index slipped 0.11%, the Dow Jones Industrial Average dropped 0.03%, and the tech-heavy Nasdaq Composite rose 0.14%.
Asian equities were higher on Wednesday, clinging to all-time highs despite the overbought conditions. MSCI’s ex-Japan Asian shares index rose 0.8% to reach its highest level ever, while the Shanghai Composite hit a five-year high on the last trading day before the week-long Lunar New Year holidays. Corporate earnings continue to lift investor sentiment. This time, Japanese car giant Toyota reported a bigger-than-expected 54% jump in third-quarter profit and lifted its full-year earnings forecast. The company’s stocks ended 1.7% higher.
In Europe, stocks opened modestly higher as investors digest new corporate earnings, with stronger-than-expected results from Twitter, Cisco Systems and Lyft helping to boost sentiment. The pan-European Stoxx 600 climbed just 0.2% in early trading. Meanwhile, Societe Generale posted a net profit of 470 million euros ($570 million) for the fourth quarter of 2020.
In other markets, the dollar stays on the defensive, losing ground further amid rising stimulus hopes and the slowing rise in coronavirus cases globally. As a result, EURUSD has settled above the 20-DMA to reach the lowest level since late-January around 1.2140. Now, market focus shifts to the US CPI report and Powell’s speech due later today. If the data disappoints, the greenback could come under additional bearish pressure.
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