Global equity markets slipped and bond yields fell on Thursday as investors awaited an agreement on a U.S. aid package to mitigate the fallout from the coronavirus crisis, with poor corporate earnings reports also weighing on European shares.
Safe-haven gold extended its record-breaking run, driven by expectations of more stimulus to counter the pandemic, while the dollar gained after data suggested the U.S. labor market is stalling amid a resurgence in COVID-19 cases.
At 8.10 IST, The Japan’s Nikkei index declined 111.88 points, or 0.50%, to 22,305.29 and the Hong Kong Hang Seng index was quoted lower by 415.17 points, or 1.66%, to 24,516.98.
Initial claims for state unemployment benefits fell 249,000 to a seasonally adjusted 1.186 million for the week ended August 1, the Labour Department said, the lowest reading since mid-March.
The four principal negotiators in Washington appeared to be near agreement on some topics, but still trillions of dollars apart on major issues, including the size of a federal benefit for tens of millions of unemployed workers.
The Dow Jones Industrial Average rose 185.46 points, or 0.68%, to 27,386.98, and the Nasdaq Composite added 141.65 points, or 1.27%, to 11,267.08.
Treasury yields fell, with the 10-year note sliding to 0.504% at one point, its lowest ever after a big down spike on March 9. The benchmark note last yielded 0.5232%.
The euro climbed to its highest against the dollar since May 2018 before giving up its gains. The euro was up 0.19% to $1.1883.
The weak dollar/strong euro trend will continue into next year, a Reuters poll showed, on expectations the U.S. economic recovery is flagging, especially compared with Europe.
The dollar index fell 0.091%, while the Japanese yen strengthened 0.13% versus the greenback at 105.40 per dollar.
Spot gold prices rose $19.7201, or 0.97%, to $2,059.12 an ounce.
Oil prices hovered near five-month highs as support from a weak dollar and falling U.S. crude inventories countered bearish sentiment on fuel demand.
Brent crude futures rose $0.38 to $45.55 a barrel. U.S. crude futures gained $0.20, to $42.39 a barrel.