News

Dollar Eases; Stock Futures Recover on Fiscal Stimulus Hopes

Dollar

The dollar index, which measures the greenback against a basket of major currencies, reversed from its two-month peak of 94.59, to trade near 94.24, weighed down by improved risk sentiment on hopes of fiscal stimulus. During his appearances this week, the Federal Reserve chairman Jerome Powell highlighted the urgency of further fiscal stimulus. However, ahead of US elections, it is very tough to reach a deal between Democrats and Republicans on the bill. Currently, the Democrats are trying to push for a $2.2 trillion bill, but this remains very far from the scope of Republicans. Will there be any compromise to support economic recovery? The EURUSD inched higher to $1.1679, but still, the headwinds to the economic recovery in the Euro region are weighing on the bull's power, and the GBPUSD recovered to $1.2801.

Equities

Major US stock index futures recovered slightly amid hopes of further support to the economic recovery. Fed's Powell reiterated that the Federal Reserve is going to do whatever it takes to restore the economic activity to the pre-pandemic level. But, he also tried to push for fiscal stimulus. The Democrats are floating an attempt for a $2.2 trillion stimulus bill. The headlines revived investors' risk appetite, but still we there is a long way to go. The Dow Jones Industrial Average futures rose to 26881, the S&P500 futures rallied to 3258, and Nasdaq futures edged higher to 10975.

Metals

Precious metals prices erased partial losses as the dollar eased from its two-month high. The value of a gold ounce raced higher to $1874, after testing a two-month low of $1848, the price of a silver ounce rose to $23.30, and palladium futures ascended to $2246.

Oil

Oil prices moved higher, trimming early week losses, on hopes of further assistance to the economic recovery. Investors are afraid that oil-demand levels will follow again with the resurgence of COVID19. The West Texas Intermediate crude November delivery rose to $40.61, and the Brent blend November delivery advanced to $42.22.

Major Economic Events

GMT Country Event Expectation Previous

12:30

US

 Durable Goods Orders (MoM) (Aug)

1.5%

11.4%

17:00

US

 U.S. Baker Hughes Oil Rig Count

-

179

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