US equities halted the three-day rally on Tuesday, as investors took profits ahead of the US presidential debate. Financials, energy, and industrials, which have been among the best-performing sectors on Monday, found strong resistance and fell.
Investors decided not to go big ahead of the debate between Trump and Biden. Meanwhile, they’re in wait-and-see mode ahead of the stimulus vote expected next week.
Both the S&P 500 and the Dow fell by 0.48%, while Nasdaq lost 0.29%. All three indexes are set to close their first bearish month since March, when the US introduced lockdown measures to curb the spread of the new coronavirus. Still, Nasdaq and the S&P 500 are about to conclude their best two-quarter performance in 20 and 11 years, respectively.
Early in the session, stocks extended gains after the Conference Board said that the US consumer confidence beat analysts’ expectations and gained the most in 17 years in September, though it still remains below pre-COVID levels.
Asian stocks are mixed in early trading on Wednesday. Initially, upbeat Chinese data boosted Asian equities, but the chaotic debate between Trump and Biden, which concluded a few hours ago, put pressure on the markets.
At the time of writing, China’s Shanghai Composite is down 0.25% after a strong open, while the Shenzhen Component is up 0.53%. Next week, Chinese markets will be closed for the entire week in observance of a national holiday. Earlier today, Chinese data released showed that the economy keeps accelerating the recovery, as manufacturing and services PMIs for September maintained above the 50-mark that separates growth from contraction. The manufacturing PMI rose to 51.5 from August’s 51, beating forecasts of 51.2. The non-manufacturing PMI was 55.9 from 55.2 in August.
Japan’s Nikkei 225 has tumbled 1.25% even though Japan reported that industrial production rose last month 1.7% from July, beating analysts’ expectations.
South Korea’s markets were closed for the Fool Moon Festival.
Hong Kong’s Hang Seng Index is up 0.61%, Australia’s ASX 200 has slumped 1.87%, and India’s Nifty 50 has gained 0.16%.
In individual corporate news, JPMorgan agreed to pay almost $1 billion to settle the CFTC’s charges of market manipulation of metal futures and Treasury securities. America’s largest bank by assets admitted the wrongdoing and agreed to pay the biggest fine ever imposed by the CFTC. Between 2008 and 2016, the banking giant engaged in market manipulation in the gold and other precious metal futures and US Treasury securities by placing orders, which were never intended to be executed, to create the impression of buy or sell interest.
Elsewhere, sources familiar with the matter told Reuters that the US Justice Department is about to sue Google’s Alphabet next week and is now calling state attorneys general to join the lawsuit. Google is accused of trying to disadvantage rivals like Bing.
In the commodity market, oil prices extended losses amid worries about the accelerated increase in COVID infections, which lead to more severe restrictions. Both WTI and Brent have lost about 1% to trade at $38.91 and $41.11, respectively. Yesterday, crude prices tumbled over 3% as the total number of coronavirus-related deaths passed the 1 million mark. Investors ignored data from the American Petroleum Institute, according to which US crude inventories unexpectedly narrowed last week.
After a bullish Tuesday, gold is currently declining on stronger US dollar. The metal has dropped by 0.62% to $1,891 per ounce.
As for the greenback, it has gained momentum as investors digest China’s upbeat data pointing to recovery and the chaotic presidential debate. The USD Index rose 0.11% and 94.032 and EUR/USD fell 0.15% to 1.1724.
The pound gave up earlier gains against both the USD and the euro, as the UK parliament passed the Internal Markets Bill, which overrides the current treaty between Britain and the EU and may lead to a no-deal Brexit.
