Asia Morning August 20

Asia Morning: U.S. Stocks Retreat After Record Closes

On Wednesday, U.S. stocks ended in the red. The Dow Jones Industrial Average fell 85 points (-0.31%) to 27692, the S&P 500 dropped 14 points (-0.44%) to 3374, and the Nasdaq 100 was down 80 points (-0.71%) to 11318.

Dow Jones Industrial Average: Daily Chart

Sources: GAIN Capital, TradingView

Real Estate (-2.02%), Automobiles & Components (-1.44%) and Energy (-1.16%) sectors lost the most. Target (TGT +12.65%) gapped up to an all-time high after reporting upbeat second-quarter results. Meanwhile, Jack Henry & Associates (JKHY -12.87%), TJX Companies (TJX -5.38%) and Gilead Sciences (GILD -4.87%) were top losers.

Shares of Momenta Pharmaceuticals (MNTA +69.17%) soared after Johnson & Johnson (JNJ +0.20%) agreed to acquire the company for $6.50 billion or $52.50 per share.

Approximately 60.8% (61.0% in the prior session) of stocks in the S&P 500 Index were trading above their 200-day moving average and 71.3% (76.4% in the prior session) were trading above their 20-day moving average.

Minutes from the U.S. Federal Reserve's latest meeting showed that officials expected the economy to require "additional accommodation" for recovering from the coronavirus pandemic.

Later today, investors will watch closely numbers of Initial Jobless Claims (a decline to 920,000 expected) and Continuing Claims (a fall to 15.00 million expected). The Conference Board Leading Index will also be released (+1.1% on month in July expected).

European stocks rebounded. The Stoxx Europe 600 Index rose 0.65%. Germany's DAX 30 increased 0.74%, France's CAC 40 gained 0.79%, and the U.K.'s FTSE 100 added 0.58%.

U.S. government bond prices eased, as the benchmark 10-year Treasury yield climbed to 0.685% from 0.662% Tuesday.

Spot gold lost again the key level of $2,000 an ounce, as it slumped $73.00 (-3.67%) to $1,929 an ounce. Spot silver shed 3.52% to $26.70 an ounce.

U.S. WTI crude oil futures (September) edged up 0.1% to $42.93 a barrel.

On the forex front, the ICE U.S. Dollar Index rebounded 0.9% on day to 93.00, halting a five-day decline, as the latest Federal Reserve's FOMC meeting minutes showed little guidance to future monetary policy path.

EUR/USD retreated 0.7% to 1.1847, following a five-day rally.

GBP/USD slid 0.9% to 1.3110. Official data showed that U.K. CPI grew 1.0% on year in July (+0.6% expected).

USD/JPY bounced 0.6% to 106.04.

USD/CAD climbed 0.4% to 1.3213. Government data showed that Canada's CPI grew 0.1% on year in July (+0.5% expected).

Other commodity-linked currencies were broadly lower against the greenback. AUD/USD dropped 0.8% to 0.7186 and NZD/USD was down 0.6% to 0.6562.

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