Update 21-05-2020: Dow Jones flat, FTSE eases losses despite another ugly jobless claims reading

The Dow Jones tried, and somewhat failed, to lift Europe into the green on Thursday afternoon, though the US open did help ease the morning’s losses.

The market’s main preoccupation this Thursday seems to be Donald Trump’s latest attacks on China, the President not letting up as he tries to win voters over by pinning the blame for the pandemic’s impact in the US on Beijing, rather than his own failings.

Investors, then, didn’t pay too much attention to wave upon wave of better than forecast flash manufacturing and services PMIs, not only in the US, but the Eurozone and UK as well. That might also be because, though they have certainly improved month-on-month, that’s not saying much given where they were at in April.

As for the usual weekly jobless claims, news of another 2.438 million Americans filing for unemployment didn’t really make its mark – then again, it hasn’t for a while, investors quickly acclimating to previously unprecedented data.

The Dow Jones was essentially flat after the bell, lurking just under 24600 – it is largely clung onto its Moderna vaccine and Fed stimulus-inspired gains from the start of the week, even with doubts about the former coming alongside the aforementioned US-China imbroglio. In turn the FTSE trimmed its own losses to around 0.2%, roughly a fifth of what was seen at lunchtime. Like the Dow, the UK index has had a pretty good week all-told, and is trading above 6060.

Update 20-05-2020: Dow Jones recovers Tuesday losses, helps lead Europe higher

The Dow Jones was keen to rebound on Wednesday, shaking off the Moderna vaccines doubts that plagued it on Tuesday.

Rising close to 400 points, the Dow returned to 24600, pretty much reversing the losses incurred last night thanks to some solid earnings, persistent optimism regarding a vaccine and the hopes of some more Fed stimulus down the line. That meant the Dow ignored Donald Trump’s latest inflammatory comments towards China, the President claiming it was the ‘incompetence’ of Beijing that caused the virus to spread.

This buoyant start gave a helping hand to the European indices, which had initially been flagging at the day’s open.

The FTSE was up 0.6%, pushing the UK index back towards 6050. This as the pound fell 0.2% against the dollar and 0.6% against the pound. The fact Bank of England chair Andrew Baily refused to rule out negative interest rates – like Fed head Jerome Powell appeared to do last week – likely aided the FTSE and hurt the pound. Meanwhile against the euro specifically a better than forecast consumer confidence reading from the across the Eurozone gave the single currency a boost – it was also up half a percent against the greenback.

As for the Eurozone indices, the DAX rose 0.7% to 11170, while the CAC eked out a 0.2% increase, keeping it the right side of 4450.

Update 18-05-2020: Vaccine reports sends Dow Jones stratospheric as optimistic Monday levels-up

Last week saw cascade of worrying headlines – focused on recession realities, the Fed’s lack of interest in negative rates, and Trump’s antagonistic attitude towards China – erode the market’s fragile optimism.

Well, said optimism returned with a vengeance on Monday, investors receiving enough green signals to help them push those aforementioned issues to the back of their minds.

Trading began with Fed chair Jerome Powell promising that the central bank had plenty left in the monetary policy tank when it comes to combatting a coronavirus recession. This, combined with falling numbers of deaths in Spain, Italy and the UK, produced a triple-digit European session.

Now, with positive results from the first human trial of Boston-based biotech firm Moderna’s experimental covid-19 vaccine mRNA-1273, the day’s growth levelled-up. Vaccine news is sort of the holy grail of market-boosters at the moment, even if headlines often obscure the timelines regarding the production of such preparations.

The Dow Jones galloped out of the date, greedily taking back 670 points. That was enough to lift the index past 24350, around 1400 points off of the lows incurred last Thursday. In turn this transformed a very strong European session into something more spectacular. A 200 point surge for the FTSE saw it touch its fingers to 6000, while a giddy 4.6% increase for the DAX sent the German bourse back above 10900.

Source: SpreadEx