Stocks in Asian markets were generally higher on Tuesday following the momentum overnight. However, stepping in European trading session, stocks edged lower in the opening as optimism faded. President Donald Trump’s return after the positive diagnosis last week boosted the rally.
President Donald Trump has left the hospital and returned to the White House, continuing his coronavirus treatment. Global markets reacted well after the news. All three major indexes of Wall Street bounced around 1.6%-2.3%. The dollar, which was deemed as the “only” safe-haven recently, was weaker against those riskier currencies on Monday. At least, the return of Trump has lowered the political uncertainties in the short term.
Risk appetite also improved as investors are betting that the US lawmakers could agree on the new relief bill. The US House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin are continuing to “talk” over the plan details by phone, boosting hopes on the “deal”.
ZFX analyst Jacob Leung said that, dollar is still playing the role of “Cash”. Risk sentiment is basically just related to the trend of the dollar, with a very strong positive correlation.
On the other hand, investors are looking forward to the UK-EU talks. While the risk of “Hard” Brexit lower, the Sterling and Euro look good, approaching 1.3 and 1.18 respectively.
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