New developments in Afghanistan added to the risk-off sentiment
Wall Street stocks slipped on Thursday, as investors awaited Powell’s speech due later today while new developments in Afghanistan added to the risk-off sentiment. The Pentagon confirmed 12 U.S. service members were killed and 15 wounded after two explosions went off outside the Kabul airport.
On the data front, weekly initial jobless claims came in at 353,000, a slight increase from the prior week’s 349,000. Economic growth totaled 6.6% in the second quarter, a slight revision upward from the 6.5% annual increase. As such, the Dow Jones Industrial Average was down 0.54%, the S&P 500 index was down 0.58%, while the Nasdaq Composite Index was trading 0.64% lower.
Today in Asia, stocks were mixed ahead of the Fed Chair Jerome Powell’s remarks at the Fed’s annual Jackson Hole gathering. Tokyo’s Nikkei 225 lost 0.36% while the Kospi in South Korea added 0.17%. The Hang Seng in Hong Kong was 0.03% lower while the Shanghai Composite advanced 0.59%. At the same time, investors continue to be anxious amid the rapid spread of the delta variant of the coronavirus in the region.
European equities are mostly lower on Friday, with the pan-European STOXX 600 index slipping 0.2% in early trading. As fresh calls for early tapering from a few hawkish Fed policymakers unsettled investors yesterday, market players are focused on Powell’s speech at the Jackson Hole summit. As for the data, France’s consumer confidence arrived at 99 in August versus 100 expected. In Germany, import price index came in at +2.2% versus +0.8% m/m expected.
Meanwhile, the dollar is back under pressure following a short-lived bounce seen yesterday. EURUSD faced resistance around 1.1780 and has been struggling to regain upside bias since then. The pair is flirting with the flat-line on Friday, struggling for direction ahead of Fed’s Powell speech. A hawkish tone could push the greenback higher across the board later today.
