Large-cap tech stocks weighed on US and European equities on Tuesday despite reassurances about President Donald Trump’s improving health and progress towards a stimulus deal.
Trump said he felt “real good” upon returning to the White House after a three-day hospital stay where he received an experimental treatment for Covid-19.
“The view that Trump appears to be on the road of recovery is benefiting the global markets because it indicates that there is stability in the White House,” said Tim Ghriskey, Chief Investment Strategist at Inverness Counsel in New York.
But market leading large-cap tech stocks weighed on US stocks after reports that the US House of Representative’s upcoming antitrust report contains a “thinly veiled call” to break up companies.
US Federal Reserve Chair Jerome Powell was speaking on the topic of “Economics, Business and Policy in the Pandemic” at a virtual meeting of the National Association for Business and Economics.
“Powell’s not prone to surprising the markets,” Ghriskey added. “He’s likely to confirm Fed’s goals of improving employment and creating some inflation over the longer term.”
Stocks were little changed as Powell began his remarks.
Optimism over the passage of a new pandemic relief aid package was growing in the background as US House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin continued to hammer out a bipartisan agreement months after emergency benefits expired for millions of Americans.
The Dow Jones Industrial Average rose 107.79 points, or 0.38%, to 28,256.43, the S&P 500 gained 3.18 points, or 0.09%, to 3,411.81 and the Nasdaq Composite dropped 2.36 points, or 0.02%, to 11,330.12.
European equities advanced after Trump’s release from hospital helped ease uncertainties and as Germany reported a “remarkable” jump in industrial orders, but pared gains due to weakness in tech and healthcare stocks.
The pan-European Stoxx 600 index rose 0.16% and MSCI’s gauge of stocks across the globe gained 0.28%.
Crude prices extended gains, boosted by waning uncertainties surrounding Trump’s health and supply disruptions from the ongoing oil workers’ strike in Norway.
US crude rose 3.9% to $40.75 per barrel and Brent was last at $42.78, up 3.61% on the day.
The dollar edged nominally lower as investors waited for developments in the ongoing stimulus talks in Washington. The dollar index fell 0.09% with the euro up 0.08% to $1.179.
Published in The Express Tribune, October 7th, 2020.
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