Claims for unemployment benefits in the US dropped to a one-year low last week
Wall Street stocks shrugged off early losses, to close higher overnight as the Labour Department data that showed a declining number of Americans claimed unemployment insurance – claims for unemployment benefits dropped to a one-year low last week. Adding to the positive tone, Biden said that his administration is aiming to distribute 200 million doses of Covid-19 vaccines in its first 100 days, doubling the original goal. As such, the S&P 500 rose 0.52%, the Dow Jones Industrial Average gained 0.62%, and the tech-heavy Nasdaq Composite recovered from early losses to edged 0.12% higher at the closing bell.
Following suit, Asian markets gained on Friday, driven by hopes for a strong recovery from the pandemic. Equities managed to bounce from three-month lows as investors shrugged off rising tensions between the West and China. MSCI’s ex-Japan Asia index rose 1.43%, while the Shanghai Composite Index gained 1.63% following recent losses incurred after the European Union joined Washington’s allies in imposing sanctions on officials in China’s Xinjiang.
European markets opened higher, as investors balanced worries about new lockdowns in the region with the prospect of a robust US economic recovery. As such, the pan-European STOXX 600 index rose 0.8% in early trading, hitting a one-week high. On the data front, Germany’s March Ifo business climate index came in at 96.6 versus 93.2 expected. Expectations index arrived at 100.4 versus 95.0 expected while current assessment came in at 93.0 versus 91.3 expected. Better-than-expected figures added to a more upbeat sentiment ahead of the weekend.
Meanwhile, the dollar is slightly off mid-November highs as safe-haven demand has eased somehow today. As a result, EURUSD bounced from lows in the 1.1760 area but still struggles to regain the 1.1800 figure that represents the immediate resistance for the common currency at this stage. Despite the recovery, the upside potential remains limited, with bearish risks persisting surrounding the euro amid the resurgent pandemic in the Eurozone that dents the appeal of the European currency.