Top 5 Things to Know in the Market on Tuesday, August 11th

Top 5 Things to Know in the Market on Tuesday, August 11th

Investing.com  | Aug 11, 2020 06:33

Top 5 Things to Know in the Market on Tuesday, August 11th

By Geoffrey Smith 

Investing.com -- The S&P is set to test an all-time high as the coronavirus starts to retreat and President Trump talks up tax cut plans. Talks on the next round of economic relief measures are still deadlocked. A German leading indicator hits its highest level in 16 years, but the U.K. labor market weakens sharply. Oil prices rise ahead of the first of three big updates this week. Here's what you need to know in financial markets on Tuesday, August 11th.

1. Virus recedes

The number of new infections of Covid-19 in the U.S. stayed under 50,000 for a second straight day, strengthening hopes that the virus is coming back under control.

The number of hospitalizations also fell in California, New York and Texas, although they continued at a high rate in Florida.

The curve of new infections has clearly flattened since states across the south and west started to tighten restrictions on indoor meetings and on the wearing of face masks. The question is now whether it can stay subdued as schools across the country prepare to reopen, potentially creating a powerful vector for community spread.

Further afield, Russia – which has been accused of trying to steal intellectual property from U.S. and European pharma companies researching Covid-19 treatments – conditionally approved its first vaccine for the virus.

The worldwide number of confirmed cases topped 20 million, due not least to fast-rising case numbers in India.

2. Stimulus talks still deadlocked as Trump grandstands with CGT cut

The next round of economic relief measures for the U.S. economy remains deadlocked, although both the Trump Administration and House Democrats claimed they were ready to talk again.

Late on Monday, President Donald Trump said he’s “seriously considering” a cut in capital gains tax, a statement that has supported risk assets overnight despite the obvious difficulty in enacting it in the current circumstances.

Trump has benefited politically from his handling of the recent standoff and, it would seem, from the easing of the health crisis in the south and west, according to some political trackers. Spread betting firm Predictit now gives Trump a 45% chance of winning the election in November, the highest it’s been since early June.

3. S&P 500 nears all-time high

U.S. stock markets are set to open higher, supported by the improving news from the virus front and by Trump’s musing on tax cuts.

The S&P 500 is set to test an all-time high later, with the index’s futures contract trading up 0.7% at 3,376, less than 1% below February’s peak.

By 6:30 AM ET (1030 GMT), the Dow 30 Futures contract was up 272 points or 1.0%, while the Nasdaq 100 futures contract was up 0.5%

Stocks in focus are likely to include IAC/InterActiveCorp (NASDAQ:IAC), the owner of Tinder and other dating sites, which reported disappointing results after the bell on Monday, and Occidental Petroleum (NYSE:OXY), which reported an $8.4 billion loss with heavy writedowns and a big cut to its production forecast.

Also of interest will be Uber (NYSE:UBER) and Lyft (NASDAQ:LYFT), which were ordered by a California court on Monday to treat their drivers as employees, a ruling that will sharply raise their operating costs if not overturned on appeal.

4. German sentiment improves

European stocks were also sharply higher overnight, despite a mixed bag of economic data that showed the extent of the troubles facing the economy.

The closely-watched German ZEW economic sentiment index rose to a 16-year high as expectations of a recovery became ever more firmly entrenched. However, the index of current conditions worsened, instead of improving as expected.

In the U.K., meanwhile, employment fell at the sharpest rate since 2009, with 220,000 jobs being lost in the three months through May. The more up-to-date figure of those claiming jobless benefits rose by 94,400 in July and is set to continue rising through year-end as the government winds back its wage subsidy scheme.

5 Oil drifts higher ahead of API, STEO 

Crude oil prices pushed higher amid hopes that the U.S. economy has avoided another major hit from the Covid-19 pandemic.

By 6:25 AM ET (1025 GMT), U.S. crude futures were up 1.6% at $42.61 a barrel, while the international benchmark Brent was up 1.2% at $45.52 a barrel.

At 8 AM, the U.S. Energy Information Administration will release its latest Short-Term Energy Outlook, the first of three major updates on the state of the oil market this week.

At 4:30 PM, the American Petroleum Institute will release its estimate of U.S. crude stocks for last week.

Related News

Latest comments

Add a Comment
Please wait a minute before you try to comment again.
Discussion
Write a reply...
Please wait a minute before you try to comment again.

Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

English (USA) English (UK) English (India) English (Australia) English (South Africa) English (Philippines) English (Nigeria) Deutsch Español (España) Español (México) Français Italiano Nederlands Português (Portugal) Polski Português (Brasil) Русский Türkçe ‏العربية‏ Ελληνικά Svenska Suomi עברית 日本語 한국어 简体中文 繁體中文 Bahasa Indonesia Bahasa Melayu ไทย Tiếng Việt हिंदी
Sign out
Are you sure you want to sign out?
NoYes
CancelYes
Saving Changes

+

Download the Investing.com App

Get free real time quotes, charts and alerts on stocks, indices, currencies, commodities and bonds. Get free top of the line technical analysis/predictors.

Investing.com is better on the App!

More content, faster quotes and charts, and a smoother experience is available only on the App.

';