4:05 pm: US equities higher as aid talks move ahead
US stocks closed higher as Democrats and the White House advanced their negotiations for a new coronavirus stimulus package before the November 3 election.
Banks led the gains as the 10-year Treasury yield hit a four-month high. JPMorgan Chase and Morgan Stanley spiked 3.5% and 2.7%, respectively.
On the day, the DJIA jumped 152 points, or 0.54%, to 28,363. The S&P 500 increased 0.52% to 3,453 and the tech-heavy Nasdaq rose 0.19% to 11,506.
12.10pm: FTSE 100 closes in the green
FTSE 100 index turned positive going into the close and ended Thursday ahead as traders were buoyed by positive comments coming out of Washington on the stimulus package.
Britain's top share index closed the afternoon session up around 12 points at 5,789. FTSE 250 added over 106 points to close at 17,894.
It came as Nancy Pelosi, the House Speaker, said they were "nearly there" in relation to an agreement on the coronavirus (Covid-19) relief package, which prompted a bout of pre-close buying for London.
In the US, stocks were red though. The Dow Jones shed around 16 points, while the S&P 500 lost about one point at 3,434.
"The labour market is improving but that hasn’t improved sentiment in stocks. The jobless claims reading fell to 787,000 – it’s lowest since March. The continued claims report is one week behind the jobless update and it dropped from 9.39 million to 8.37 million," noted David Madden, analyst at CMC Markets.
In the UK, with the furlough furlough scheme set to end this month, Chancellor Rishi Sunak's plan to provide grants and wage support, announced earlier, also brought a sigh of relief for markets.
"The prospect of a vaccine in the coming months coupled with measures to lessen the damage of near-term lockdowns should provide a significantly more optimistic outlook for investors," said Joshua Mahony, at IG.
US and Canada 11.30am EST
Wall Street stocks were mixed and uninspired in early deals. The Dow Jones Industrial Average added around 18 points at 28,228. The S&P 500 gained around two points at 3,437. The tech-laden Nasdaq exchange shed around 22 at 11,462. In Toronto, the TSX index added less than one point to stand at 16,231.
10.25am: Proactive North America headlines:
CytoDyn Inc (OTCQB:CYDY) taps Mahboob Rahman as chief scientific officer as it accelerates its clinical and regulatory priorities
Ximen Mining (CVE:XIM) (OTCQB:XXMMF) says rock chip sample results from Amelia property in BC show significant gold and silver
Fura Gems Inc (CVE:FURA) (OTCPINK:FUGMF)arranges US$2.5M bridge financing
Ideanomics (NASDAQ:IDEX) acquires 15% stake in Solectrac, Inc, a California-based developer of electric tractors, for a consideration of $1.3mln
9:45 am: Wall Street tentatively steps into positive territory with one eye on stimulus talks
The Dow Jones Industrial Average made soft gains at the open, improving 47 points, 0.2%, to 28,257.8. The Nasdaq Composite grew 54 points, 0.5%, to 11,542.6, and the S&P 500 increased 9 points, 0.3%, to 3,445.1.
Traders are still waiting on any news regarding a coronavirus stimulus deal between House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin.
The two sides appear closer than ever to a compromise, according to Pelosi's deputy chief of staff Drew Hammill, who tweeted about the talks Wednesday evening.
The Speaker & Secretary Mnuchin spoke today at 2:30 pm for 48 minutes. Today's conversation brings us closer to being able to put pen to paper to write legislation. With the exchange of legislative language, we are better prepared to reach compromise on several priorities. (1/3)— Drew Hammill (@Drew_Hammill) October 21, 2020
In subsequent tweets, Hammill added that "Differences continue to be narrowed" on health on testing and contract tracing, but that "more work needs to be done to ensure that schools are the safest places in America for children to learn."
Pelosi and Mnuchin are expected to meet again today.
7:50 am: Wall Street futures look flattish
US benchmarks are set to open little changed on Thursday ahead of tonight’s election debate between President Donald Trump and Democratic Party challenger, Joe Biden, and with a big batch of corporate earnings to digest once again.
Spread betting quotes indicate the S&P 500 is set to open little changed while the Dow Jones Industrials Average is expected to dip 17 points to 28,194.
But the Nasdaq Composite is seen opening 204 points higher at 11,688 helped by results from electric car maker Tesla Inc (NASDAQ:TSLA) last night showing record revenue which beat analyst expectations.
As well as the presidential election debate to look forward to, traders can also continue to experience the world’s most boring spectator sport, the negotiations over the US fiscal stimulus package.
“The back and forth between the Democrats and the Republicans seems to be never-ending and traders are getting sick of the negotiations dragging on. The mood is a little downbeat because all the while that US politicians are squabbling, the health crisis is getting worse.
“Traders are not cutting and running from equity markets because there is a view that some sort of a package will be agreed upon eventually, the US economy needs assistance but there isn’t much hope that it will be achieved soon,” said CMC’s David Madden.
Meanwhile, alarm bells have been set jangling by accusations that Iran and Russia have attempted to interfere with the US election.
“As the US election draws closer, the warning that Russia and Iran have attempted to interfere with the US election serves as a reminder that there is still a range of scenarios that could play out come November 3,” said Saxo Bank’s Eleanor Creagh.
“Another potential complication in the offing is the rising COVID-19 case count, which continues to trend higher. According to Bloomberg, New Jersey recorded its highest case count since July, along with 10 other states, including Wisconsin, Iowa, Nebraska and Ohio. Hospitalisations and ICU cases have also risen, although the silver lining, deaths are yet to follow suit,” she noted.
On the macroeconomic stage, several US economic releases are scheduled, including the latest weekly jobless claims figures, existing-home sales data and the Conference Board’s leading index for September.
Five things to watch on Thursday:
- Tesla Inc posted its fifth consecutive quarterly profit on record revenue after-hours on Wednesday, beating analysts’ estimates thanks to an increase in vehicle deliveries. The firm’s revenue rose to $8.77 billion, up from $6.30 billion a year earlier above consensus expectations for $8.36 billion.
- Coca-Cola Co beat quarterly revenue expectations as the world’s largest soda maker benefited from the partial reopening of theaters and restaurants shut for months by the coronavirus (COVID-19) pandemic, with organic sales down 6% for the three months ended September 25, 2020, an improvement from a 26% fall in the second quarter.
- American Airlines Group Inc has reported a third straight quarterly loss impacted by a slump in travel globally due to the coronavirus (COVID-19) pandemic, with the group’s third-quarter cash burn rate at about $44 million per day, compared with about $58 million a day in the second quarter.
- AT&T Inc said the coronavirus pandemic had taken a heavy toll on its media business, but stronger than expected gains in new phone subscribers, due to offers for its HBO Max streaming service for free on certain phone plans, helped it beat quarterly revenue expectations. Total revenue was $42.3 billion during the third quarter ended September 30, exceeding the average analyst expectation of $41.59 billion.
- Goldman Sachs Group Inc this week will agree to pay more than $2 billion to settle US charges over its role in Malaysia’s 1MDB corruption scandal, lifting a dark cloud that has hung over the bank for years.