Opening Bell: U.S. Futures, Global Stocks Mixed; Dollar Firms; Oil Gains

August 10, 2020

New York (Aug 10)  US futures for the Dow Jones, S&P 500, NASDAQ and Russell 2000 were mixed on Monday, while European shares failed to advance after better-than-expected Chinese data showed factory prices had fallen less than anticipated. US-China tensions continue in the aftermath of President Donald Trump's threat last week to ban TikTok and WeChat in the US.

As well, even after Trump's executive orders on tax relief and stopgap employment benefits were issued on Saturday, markets await some resolution to the Congressional stalemate currently holding back any official bills on additional coronavirus relief in the US.

Yields rose, the dollar was flat and silver kept pushing higher.

Global Financial Affairs

Contracts on US major indices, which had climbed during the Asian session this morning, fell as European markets opened even though some regional stocks surged higher.

European stocks opened higher but were later pushed off session highs, a sign of conflicting opinions as to the market’s direction. The Stoxx Europe 600 Index initially climbed along with energy firms as oil advanced after the CEO of Aramco (SE:2222) yesterday announced demand will rise in Asia.

NASDAQ futures were in the red, and remain so at time of writing, extending Friday’s underperformance as the tech industry continues in the crosshairs of the world’s two largest economies. Still, some funds already consider the tech selloff a buying dip.

This morning's regional gains were attributed to ongoing hopes for additional stimulus and Friday’s better-than-expected US jobs data. The notable exceptions were Hong Kong’s Hang Seng which underperformed, (-0.5%), after authorities arrested pro-democracy media mogul Jimmy Lai on charges of national security offenses. It was the most high-profile action so far under the autonomous territory's new national security law.

Australia’s ASX 200 advanced to a three-week high, (+1.75%), providing the best results in Asia, boosted by banks and consumer stocks.

Friday's close in the US produced a weekly advance across all indices, but produced a divergence between tech shares, which fell during the final day of trade last week, and smaller, domestic firms which rallied on jobs growth.

Yields, including for the 10-year Treasury, reached their highest level since late-July.

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