Global equities edge lower, safe havens rise, as U.S. stimulus talks stall
By David Randall NEW YORK (Reuters) - An impasse in U.S. stimulus negotiations and mixed corporate earnings reports in Europe left global equities treading water and sent investors into perceived safe-haven assets like government bonds and gold, which hovered near record highs
By David Randall
NEW YORK (Reuters) - An impasse in U.S. stimulus negotiations and mixed corporate earnings reports in Europe left global equities treading water and sent investors into perceived safe-haven assets like government bonds and gold, which hovered near record highs.
U.S. Senate Republicans on Monday announced a $1 trillion coronavirus aid package hammered out with the White House, which Senate Majority Leader Mitch McConnell touted as a "tailored and targeted" plan to reopen schools and businesses.
But the proposal sparked immediate opposition from both Democrats, who called it too limited compared with their $3 trillion proposal that passed the House of Representatives in May, and some Republicans who called it too expensive.
Enhanced unemployment benefits expire on Friday, which would be a blow to household incomes and spending power.
Some 30 million Americans are out of work and states are tightening lockdown restrictions again, a trend that has also dragged on the U.S. dollar.
Alan Ruskin, head of G10 strategy at Deutsche Bank, noted currencies had been tracking the relative performance of their economies, so high-ranked economic performance was associated with stronger currencies.
"One clear pattern is how economies linked most tightly to China -- including commodity producers as diverse as Australia, Chile and Brazil -- have tended to perform better than economies most directly linked to the U.S., notably its NAFTA trading partners," said Ruskin.
MSCI's gauge of stocks across the globe <.MIWD00000PUS> gained 0.04% following modest declines in Asia and broad gains in Europe.
In midday trading on Wall Street, the Dow Jones Industrial Average <.DJI> fell 113.27 points, or 0.43%, to 26,471.5, the S&P 500 <.SPX> lost 3.29 points, or 0.10%, to 3,236.12 and the Nasdaq Composite <.IXIC> dropped 30.78 points, or 0.29%, to 10,505.49.
The rest of the week will see 179 S&P 500 companies reporting second-quarter earnings, including Google, Amazon and Apple.
Spot gold added 0.3% to $1,947.47 an ounce. U.S. gold futures fell 0.12% to $1,928.60 an ounce.
Gold is still up over $125 in little more than a week as investors bet the Federal Reserve will reaffirm its super- accommodative policies at its meeting this week, and perhaps signal a tolerance for higher inflation in the long run.
"Fed officials have made clear that they will be making their forward guidance more dovish and outcome-based soon," wrote analysts at TD Securities. "The chairman is likely to continue the process of prepping markets for changes when he speaks at his press conference."
The dollar has been falling almost across the board for a month. It reached a two-year low against a basket of currencies at 93.416 overnight before recovering to 93.975.
The euro dropped back to $1.1715 after rising to its highest in two years at $1.1781. The dollar had touched its lowest against the Swiss franc since mid-2015. It also fell to a four-month low of 105.10 against the Japanese yen before squatting at 105.25.
Benchmark 10-year notes last rose 6/32 in price to yield 0.5905%, from 0.609% late on Monday.
Oil prices fell on concerns of declining demand.
U.S. crude recently fell 1.27% to $41.07 per barrel and Brent was at $43.25, down 0.37% on the day.
(Reporting by David Randall; Editing by Bernadette Baum and Tom Brown)
This story has not been edited by Firstpost staff and is generated by auto-feed.
By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.