The American stock market fully recovered after Tuesday's fall - 8.10.2020

Senior Analytical Expert

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Todays’ Market Summary

On Wednesday, the US dollar index dropped slightly, but overall, since early October, it has been traded in a narrow neutral range, just above 93.5 points.
On Wednesday, American stock indices showed a significant increase and fully recovered after Tuesday's fall.
World oil prices are rising today for the 4th day in a row.
Today, precious metals quotes are rising slightly for the second day in a row with the little weakening of the US dollar.

Top daily news

The FOMC Minutes in September confirmed investor sentiment that the Fed is ready to increase spending on asset buybacks (QE) and other stimulus programs.This boosts the US stock market, but prevents the dollar from strengthening.The Q3 corporate reporting season begins.

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Forex news

Currency Pair	Change
EURUSD	-0.04%
GBPUSD	+0.05%
USDJPY	+0.01%

On Wednesday, the US dollar index dropped slightly, but overall, since early October, it has been traded in a narrow neutral range, just above 93.5 points. Just 3 weeks left before the American presidential elections and investors do not want to take risks. Republican candidate Donald Trump stands for the limitation of monetary stimulus to the US economy through the Fed emission. Democratic candidate Joe Biden believes the bailout is needed to boost economic growth. His position is supported by the head of the Fed, Jerome Powell. Joe Biden has the upper hand in polls. This could slightly slow down the dollar index growth and support the stock market advance. Yesterday's materials from the September FOMC Minutes confirmed the investors' beliefs that the Fed is ready to increase spending on asset buybacks (QE) and other stimulus programs. Fed representatives are to speak today. They are expected to share their views on the Fed's future monetary policy.

Stock Market news

Indices	Change
SP500	+1.74%
DJI	+1.91%
Nd100	+1.88%
NIKKEI	+0.96%
DE30	+0.5%

On Wednesday, American stock indices showed a significant increase and fully recovered after Tuesday's fall. Several positive factors contributed to this. First, the clarification by the US President Donald Trump that he does not cancel the monetary stimulus program aimed to help the American economy, but only reschedules it to the post-election period. Second, the Fed's readiness to increase the money issuing for such stimulus program. In addition, good corporate news contributed to the growth of indices. Delta Air Line, American Airlines, United Airlines Holdings, and aircraft manufacturer Boeing surged 3-4% on a pledge from US President Donald Trump to financially support the aviation sector. Pharmaceutical company Eli Lilly (+ 4%) is set to begin testing its new Covid-19 drug. Let's recall that the Q3 corporate reports publication is starting from now. According to the Refinitiv's preliminary forecasts, the total profit of companies from the S&P 500 list will drop by 21%. Today, the US unemployment data for the week will be released. The outlook is positive.

Commodity Market news

Commodities	Change
#C-BRENT	+1.41%
OIL	+1.25%

World oil prices are rising today for the 4th day in a row.According to the U.S.Energy Information Administration, US oil reserves for the week rose by 501 000 barrels.This is less than the data provided by the API.Investors paid little attention to the information on the oil stocks, as due to Hurricane Delta, oil production in the Gulf of Mexico stopped.As a result, its total production in the United States fell by 1.5 million barrels per day, which contributed to the growth of quotations.

Gold Market News

Metals	Change
XAGUSD	+0.91%

Today, precious metals quotes are rising slightly for the second day in a row with the little weakening of the US dollar.Today is the last day of long holidays in China (October 1-8).Gold trading may pick up tomorrow.