Global market sentiment fared a somewhat neutral setting this past week as investors remain on the edge around US fiscal stimulus talks as the presidential election nears. The Dow Jones[1], S&P 500[2] and Nasdaq[3] Composite began with week with outsized losses, spending the rest of their time trading sideways. This is despite what has been a rosy third-quarter earnings season so far.
The Euro[4] and New Zealand Dollar[5] were some of the best-performing major currencies. This is as the haven-linked US Dollar[6] underperformed. For commodities, gold prices[7] traded mixed while growth-linked crude oil[8] erased gains it accumulated earlier in the week. The British Pound[9] received a lift as the EU and UK resumed Brexit talks, but GBP/USD[10] gave up gains into the weekend.
Next week is poised to be a busy one. US election polling and fiscal stimulus talks will remain in the spotlight. Treasury Secretary Steven Mnuchin said that Nancy Pelosi, the Speaker of the House, has ‘dug in’ and that there are still significant differences. White House Economic Adviser Larry Kudlow noted ‘it is going to be very hard to get it done’.
Meanwhile, major tech players will release their earnings including Facebook, Apple and Alphabet. Further rosy surprises could help cushion downside potential in equities. All eyes will also be on Q3 US GDP where a record bounce back is expected immediately following the worst quarterly contraction on record. European and Canadian growth data will also cross the wires.
The British Pound also remains glued to ongoing Brexit talks. French President Emmanuel Macron laid out the framework for compromising on fisheries, a key component
