Durable goods orders data may affect market dynamics - 27.10.2020

Senior Analyst

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Todays’ Market Summary

Top daily news

The growth of the number of patients with coronavirus caused a significant drop in stock indices and almost did not affect the greenback rate. Today investors expect the publication of important statistics and large companies' quarterly reports.

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Forex news

Yesterday, the US dollar index rose thanks to investors' confidence that the Federal Reserve's emission to provide financial aid to the US economy will take place only after the November 3 elections. The US dollar index declined today as the number of coronavirus cases continues to rise and US-China trade disputes escalate. According to Johns Hopkins University, 43.4 million people worldwide have already fallen ill with Covid-19. The United States agreed to sell 100 Harpoon missile systems to Taiwan for $2.4 billion. In response, China imposed economic sanctions on American military equipment manufacturers Lockheed Martin, Boeing Defense and Raytheon.

Stock Market news

On Monday, American stock indices dropped markedly. The Dow Jones' daily drop was the highest in 7 weeks. This was facilitated by the risks of the 2nd wave of the pandemic and the downturn of business activity in the world, as well as the postponement of the allocation of aid to the American economy. This issue will most likely be discussed again only after the appointment of a new US president. The very weak data on New Home Sales for September became an additional negative factor . Amid the coronavirus, shares of travel companies such as Carnival and Royal Caribbean Cruises fell by more than 9%. The S&P 1500 airlines lost 5%. At the same time, investors were actively buying stocks in companies providing home services. Amazon.com Inc, Zoom Video Communications, Activision Blizzard and Take-Two rose within 2%. This morning, US stock indexes futures rose slightly in anticipation of positive economic statistics. Data on durable goods orders for September and CB Consumer Confidence for October will be released soon. Microsoft, Pfizer, Merck & Co, Eli Lilly, AMD, 3M, Caterpillar and other companies will release their quarterly reports.

Commodity Market news

World oil prices are slightly higher today. The main reason for it was the formation of the hurricane Zeta in the Gulf of Mexico. Because of this, a number of American drilling platforms stopped workig. Commonwealth Bank of Australia forecasts that the average price of WTI and Brent oil in the 4th quarter will be $38 and $41 per barrel, that is, there will be no significant drop in demand. Wheat futures rose in price due to the drought in Russia and the increase in its export prices. The Russian Ministry of Agriculture is even considering restricting grain exports amid a poor harvest. Recall that over the past 4 months, Wheat futures have already risen in price by about a third.

Gold Market News

Gold is still traded in a narrow range near the psychological level of $1900 per ounce. Investors await the release of US and Eurozone GDP data at the end of the week.