(Bloomberg) — The dollar was steady at the start of the trading week and stocks opened mixed as investors weighed uncertainty over the timing of a stimulus package from Washington and looked ahead to this week’s expected review of the U.S.-China trade pact. Oil climbed.
S&P 500 futures dipped modestly, while equities in South Korea and Australia nudged higher. Japan and Singapore are shut for holidays and Treasuries won’t trade until the London open. Gold slipped. Crude advanced as Saudi Arabia’s state-controlled producer said it expects energy demand to pick up.
U.S. President Donald Trump signed four executive orders related to coronavirus economic relief, including unemployment benefits, a temporary payroll tax deferral, eviction protection and student-loan relief. Treasury Secretary Steven Mnuchin said he’d listen to any proposal offered by Democrats and Nancy Pelosi said she hopes talks with the White House will resume soon.
“Both parties are going to have to tread very carefully but they are going to have to move on and try to come to some kind of agreement,” Kim Forrest, chief investment officer at Bokeh Capital Partners LLC, said on Bloomberg TV. “That is ideally what happens, that this legislation never really gets enacted but that Congress has to actually sit down and get a real deal done.”
Investors are grappling with an unclear timeline, with neither side giving a firm date on Sunday political talk shows for a restart of discussions over a virus relief package. Democrats and Republicans are trillions of dollars apart on overall spending and on key issues, including on aid to state and local governments and the amount of supplementary unemployment benefits.
“The delay in announcing the U.S. virus relief package of over $1 trillion has put more pressure on the U.S. economy,” said Simon Ballard, chief economist at First Abu Dhabi Bank PJSC. “The main focus will be on escalating U.S.-China relations and progress on their trade deal talks.”
The U.S. passed 5 million coronavirus infections after adding 1 million new cases in just over two weeks. Germany’s transmission rate rose to the highest level in 10 days. Paris will mandate masks outdoors on its busiest streets starting Monday.
Here are some key events coming up:
Earnings include Barrick Gold, SoftBank, Telstra, Deutsche Telekom, Carlsberg, Tencent and JD.com.New Zealand’s policy decision is due on Wednesday.China releases a slew of data for July on Friday, including industrial production and retail sales.U.S. retail sales are expected Friday, with a smaller increase forecast for July than in the prior two months.
These are the main moves in markets:
Futures on the S&P 500 dipped 0.1% as of 10:01 a.m. in Sydney. The index rose 0.1% on Friday.Australia’s S&P/ASX 200 Index advanced 0.2%.South Korea’s Kospi index added 0.1%.
The yen was little changed at 105.86 per dollar.The offshore yuan traded at 6.9666 per dollar.The euro bought $1.1785.The Australian dollar was at 71.59 U.S. cents.
The yield on 10-year Treasuries rose more than two basis points to 0.56% on Friday. Futures were little changed Monday.Australia’s 10-year yield added one basis point to 0.84% on Monday.
West Texas Intermediate crude rose 1% to $41.66 a barrel.Gold was at $2,027.34 an ounce, down 0.4%.
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