NZX Set to Break 11-Day Win Streak
New Zealand’s main stock index fell on Thursday, with the NZX 50 easing from its record peak of 12,544 and on track to snap an eleven-day rally. Investors’ enthusiasm faded after US Treasury Secretary Steven Mnuchin said there may be no deal to reach before the November’s election while diminishing hopes for a COVID-19 vaccine added to concerns that the economic recovery from the pandemic might be slower than previously expected.
Mexican Stocks Decline 0.3%
Mexico’s IPC lost 106 points or 0.3% to 38,026 on Wednesday, tracking losses of major bourses triggered by policy uncertainty in the United States and a setback to Eli Lilly’s coronavirus vaccine candidate. On the domestic side, Mexico’s Minister of Foreign Affairs announced that the country is expecting to receive 116 million Covid-19 vaccine doses, roughly 90% of the population. Meanwhile, WTI crude oil prices increased 2.3% to trade at $41.14 a barrel on supply woes in Norway and the Gulf of Mexico and ahead of US inventory data.
Brazilian Equities Rise on Wednesday
Brazil’s Ibovespa gained 832 points or 0.8% to 99,334 on Wednesday, as an upward revision to IMF growth forecasts for 2020 outweighed domestic and US fiscal uncertainty and coronavirus vaccine woes. On the data affront, the IBGE showed the services sector grew by 2.9% over a month earlier in August boosted by services provided to families. On the corporate side, shares of Petrobras outperformed during the session nudged higher by a 2.3% increase in WTI crude oil prices, currently trading at $41.14 per barrel.
API: US Crude Oil Inventories Fall More Than Expected
Stocks of crude oil in the United States decreased by 5.42 million barrels in the week ended October 9th of 2020, following a 0.95 million gain in the previous week and compared with market expectations of a 3.39 million drop, data from the American Petroleum Institute showed.
US Stocks Extend Losses
Wall Street fell for a second day on Wednesday, as hopes of stimulus before the election faded. Treasury Secretary Mnuchin declared around midday that getting a deal approved before the election would be difficult, adding that both sides were still far apart on certain issues. However, he also noted that both parties are making progress in some areas. Meanwhile, a spokesman for House Speaker Nancy Pelosi said she and Mnuchin had a “productive” talk earlier in the day. On the corporate side, Goldman Sachs reported quarterly earnings that soundly beat estimates, while Bank of America's revenue missed expectations. The Dow Jones dropped 166 points or 0.6% to 28,514. The S&P 500 declined 23 points or 0.7% to 3489. The Nasdaq fell 95 points or 0.8% to 11,769.
TSX Falls for 2nd Day
Canadian stocks fell for a second straight session on Wednesday, touching a one-week low in choppy trading, as doubts on whether US Congress can agree on more fiscal support rattled investors. Treasury Secretary Steven Mnuchin said there may be no deal to reach before the November’s presidential election. Sentiment took a further hit on news that Johnson & Johnson and Eli Lilly were halting its trials of an experimental Covid-19 vaccine and treatment, respectively, due to safety concerns.
Argentina Inflation Rate Inches Up
Argentina’s Consumer Price Index increased by 2.8 percent on a monthly basis in September 2020, accelerating from a 2.7 percent increase in August. The high since March was mainly explained by liquor & tobacco, up 4.3 percent from 1.3 percent in the previous month, transport (3.6 percent vs 2.8 percent in August), and health (3.5 percent vs 2.4 percent). In contrast, inflation dropped for utilities (1.5 percent vs 2.3 percent), home maintenance & equipment (2.6 percent vs 3.5 percent), food & beverages (3.0 percent vs 3.5 percent), recreation & culture (1.9 percent vs 3.3 percent), communications (0.1 percent vs 0.3 percent), and education (0.3 percent vs 0.8 percent).On an annual basis, consumer prices jumped 36.6 percent in September, softening from 40.7 percent in August.
Commodities: Bitumen +6.50%, Natural gas -6.06%
Top commodity gainers are Bitumen (6.50%), Lumber (3.29%) and Crude Oil (2.01%). Biggest losers are Natural gas (-6.06%), Orange Juice (-1.32%) and Palm Oil (-0.68%).
Crude Oil is up by 2.01%
Crude Oil WTI increased 2.01% to 41 USD/Bbl
Argentine Peso Hits All-time Low
USDARS increased to an all-time high of 77.43
Cape Verde September Inflation Rate Hits 5-Month High
The annual inflation rate in Cape Verde rose to 0.8 percent in September of 2020 from 0.1 percent in the previous month, reaching its highest level since April. Main upward pressure came from prices of alcoholic beverages & tobacco (6.4 percent vs 5.5 percent in August); food & non-alcoholic beverages (1.3 percent vs 0.3 percent); housing & utilities (1.7 percent vs -0.6 percent) and transport (1.5 percent vs -1.3 percent). On a monthly basis, consumer prices remained flat for a second straight month.
US Stocks Fall Amid Stimulus Uncertainty
Wall Street's main indexes erased early gains to trade in the red on Wednesday afternoon, after Treasury Secretary Steven Mnuchin said that it would be difficult to reach a deal on coronavirus aid before the November election as both parties remain divided on key issues. Still, Mnuchin noted that Democrats and Republicans were making progress in some areas. Earlier in the session, market sentiment was supported by stronger-than-expected earnings results from UnitedHealth, Bank of America, Goldman Sachs and Wells Fargo. Revenues from Bank of America, however, disappointed and Wells Fargo profit fell 56% last quarter. Meanwhile, Eli Lilly’s antibody treatment trial has been put on hold due to safety concerns. The Dow Jones and the Nasdaq dropped more than 100 points around 12pm NY time, while the S&P 500 fell around 10 points.
Ruble Depreciates as Russia Records Record Daily Covid-19 Cases
The Russian ruble depreciated more than 0.5% to $77.6 on Wednesday, after Russia reported a record daily increase in coronavirus cases for a second consecutive day and despite a record high placement of Russia's government bonds which are usually seen as a gauge of investor sentiment towards Russian assets. Russia reported 14,231 new Covid-19 on Wednesday, up from 13,868 recorded on Tuesday. President Vladimir Putin announced that the country approved a second Covid-19 vaccine. The currency has been pressured by concerns that Moscow may face more Western sanctions, political risks related to the crisis in Kyrgyzstan and Belarus, the suspected poisoning of Alexei Navalny, the military conflict in the South Caucasus, and still-low oil prices.
Ecuador Posts Largest Trade Surplus Since 2008
Ecuador's trade surplus widened sharply to USD 368.1 million in August 2020 from USD 16.3 million in the same month of the previous year. It was the largest trade surplus since May 2008, as imports plunged 25.9 percent over a year earlier to USD 1419.4 million, due to lower purchases of consumption goods (-19.1 percent), in particular durable (-43.2 percent) and non-durable (-5.5 percent); commodities (-33.8 percent), mostly industrial (-35.9 percent), agricultural (-21.9 percent) and construction materials (-43.5 percent); capital (-5.8 percent), namely industrial (-18.8 percent); fuels & lubricants (-42.9 percent). Exports fell at a softer 7.5 percent to USD 1787.5 million, as sales dropped for commodity goods (-11.9 percent), of which crude oil (-36.7 percent); while those of manufactured products rose (11.3 percent), driven by petroleum derivatives (25.2 percent) and chemicals (33.1 percent).
Romania Current Account Gap Narrows Slightly in August
Romania's current account deficit edged down to EUR 1,002 million in August of 2020 from EUR 1,026 million in the corresponding period of the previous year. The primary income shortfall narrowed to EUR 256 million from EUR 411 million a year earlier and the secondary income surplus rose to EUR 262 million from EUR 178 million. On the other hand, the goods and services gap widened to EUR 1,008 million from EUR 792 million.
Spain Stocks Close Higher on Wednesday
The IBEX 35 added 41 points, or 0.6% to end at 6,917 on Wednesday, following a 1.1% loss in the previous session, after Spanish Economy Minister Nadia Calvino said the government is negotiating with its EU partners to get the disbursements of European Union recovery funds as early as possible so it can launch its recovery plan in January 2021. Still, investors remain worried about a spike in coronavirus infections and its impact on the country's recovery after Spain reported more 7,118 new cases on Tuesday. The capital, Madrid, is currently the area with the highest infection rate in Europe, 850 cases per 100,000 inhabitants. Meantime, the region of Catalonia, which includes the city of Barcelona, ordered bars and restaurants to close for 15 days from Thursday night onwards and limited the numbers of people allowed in shops. This is the first time one of Spain’s 17 regions has ordered such drastic measures since the central government’s state of alarm came to an end in mid-June.
French Bourse Edges Down on Wednesday
The CAC 40 edged down 5 points, or 0.1% to 4,942 on Wednesday, extending a 0.8% fall in the previous session, as France is expected to announce more coronavirus related restrictions in the coming days. On Tuesday, France reported a new daily spike in Covid-19 infections and hospitalizations rose to 5,689 from 5,350. Sentiment has been dragged down, as the European continent continues to struggle with rising coronavirus cases and as more countries impose further restrictions.
European Equities End Mixed Ahead of EU Summit
European stocks closed mixed on Wednesday, with Frankfurt's DAX 30 adding 0.1% to 13,031, as investor focus shifted to a highly anticipated EU summit starting tomorrow and earnings releases. So far, strong quarterly reports came from semiconductor equipment maker ASML Holding, navigation company TomTom, food-ordering firm Just Eat Takeaway.com, education group Pearson, and online fashion retailer ASOS. Meanwhile, investors remained concerned about the negative impact of a second wave of coronavirus infections and additional lockdown measures on Europe's recovery. The Spanish region of Catalonia ordered bars and restaurants to close for 15 days and both the Czech Republic and the Netherlands imposed partial lockdowns. France is also expected to announce more restrictions in the coming days. The FTSE MIB and IBEX 35 advanced 0.3% and 0.6% respectively, while the CAC 40 lost 0.1% and the FTSE 100 fell 0.6%.
Italian Stocks Advance Led by Atlantia
The FTSE MIB rose 49 points, or 0.3% to 19,608 on Wednesday, up from a 0.8% loss in the previous session, led by a surge in Atlantia equities (+9%) after the infrastructure company entered exclusive talks with the Italian state lender CDP until October 18th over the sale of Atlantia’s 88% stake in its motorway unit Autostrade per l’Italia. Still, investors remain cautious as the number of coronavirus cases in Europe continues to flare up whit more countries imposing restrictions. Italy reported 5,898 new coronavirus infections on Tuesday, up from 4,619 recorded on Monday.
London Shares End Lower as Investors Brace for EU Summit
The FTSE 100 closed down 0.6% at 5,935 on Wednesday, as investors await any update on informal Brexit talks ahead of Thursday's EU summit. News emerged that negotiations between the UK and the EU on their future relationship might be extended beyond Prime Minister Boris Johnson’s October 15th deadline. Meanwhile, the new three-tier system of COVID-19 restrictions has begun in England, while several countries across Europe also imposed fresh restrictions to curb the spread of the pandemic. Early gains were supported by strong quarterly reports. Education group Pearson said it was on course to hit market expectations due to stronger demand for online learning, while online fashion retailer ASOS reported a quadrupling in full-year profit. Bunzl shares also rose after the company said it expected a slightly higher operating profit margin and stronger revenue growth in the second half of the year.
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