Asia Morning Oct 7

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By :  ,  Financial Analyst

Asia Morning: U.S. Stocks Fall as Trump Cuts Stimulus Talks

On Tuesday, U.S. stocks ended in negative territory. The Dow Jones Industrial Average slid 375 points (-1.34%) to 27772, the S&P 500 fell 47 points (-1.40%) to 3361, and the Nasdaq 100 shed 217 points (-1.89%) to 11291.

Nasdaq 100: Daily Chart

Sources: GAIN Capital, TradingView

U.S. President Donald Trump announced he was halting negotiations with lawmakers on an economic stimulus bill, adding: "Immediately after I win, we will pass a major Stimulus Bill that focuses on hardworking Americans and Small Business." Thereafter, the market erased earlier gains and took a nosedive about an hour before the close.

Retailing (-2.59%), Technology Hardware & Equipment (-2.37%) and Media (-2.31%) sectors were the worst performers of the day. Boeing (BA -6.81%) was the top loser in the S&P 500. The Company said in the near-term its commercial aviation market will continue to face notable challenges as a result of the pandemic,

Approximately 69% (63% in the prior session) of stocks in the S&P 500 Index were trading above their 200-day moving average and 77% (58% in the prior session) were trading above their 20-day moving average.

U.S. official data showed that Trade Deficit widened to $67.1 billion in August ($66.2 billion deficit expected), the highest level since 2006. JOLTS Job Openings fell to 6.49 million in August (6.50 million expected).

European stocks were stable. The Stoxx Europe 600 Index closed flat, Germany's DAX 30 gained 0.61%, France's CAC 40 added 0.48% and the U.K.'s FTSE 100 was up 0.12%.

U.S. Treasury prices posted a late-session rally, pressing the benchmark 10-year Treasury yield down to 0.740%.

Spot gold price shed $35 (-1.84%) to $1,878 an ounce, and spot silver plunged 5.36% to $23.06 an ounce.

U.S. WTI crude oil futures (November) WTI Crude Oil rose $0.99 (+2.52%) to $40.21 a barrel at the close.

On the forex front, the U.S. dollar turned stronger against other major currencies after Trump called off stimulus talks with Democrats. The ICE Dollar Index rose 0.43% on day to 93.85.

EUR/USD dropped 0.42% to 1.1734. Official data showed that Germany's Factory Orders increased 4.5% on month in August (+2.9% expected). The Markit Germany Construction Purchasing Managers' Index (PMI) fell to 45.5 in September.

GBP/USD fell 0.67% to 1.2891. The Markit U.K. Construction PMI rose to 56.8 in September (54.0 expected).

USD/JPY eased 0.12% to 105.63. In fact, the pair has climbed back to levels around its 50-day moving average.

AUD/USD slumped 1.10% to 0.7102. As expected, the Reserve Bank of Australia kept its benchmark interest rate unchanged at 0.25%. The central bank added that it keeps considering how additional monetary easing could support job growth.

USD/CAD climbed 0.36% to 1.3312.

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