European Stocks, Oil Gain as U.S. Futures Steady: Markets Wrap

(Bloomberg) — European stocks rose along with the bulk of Asian equity markets as investors weighed stronger Chinese economic data and ongoing U.S. stimulus negotiations.

Energy producers led gains among European stocks and oil advanced after Saudi Aramco said demand will continue to improve. The dollar was steady, while gold retreated for a second day. Lebanon’s stock market is due to open Monday for the first time since the Beirut port explosion.

In Asian markets, South Korea and Australia outperformed. Chinese shares rose as data showed the economy continuing to recover from the pandemic, with consumer inflation accelerating and factory price deflation easing.

Investors are grappling with an unclear timeline on the U.S. virus relief package, with neither Democrats nor Republicans giving a firm date after reaching an impasse last week. The two sides are trillions of dollars apart on overall spending and on key issues, including on aid to state and local governments and the amount of supplementary unemployment benefits.

“The delay in announcing the U.S. virus relief package of over $1 trillion has put more pressure on the U.S. economy,” said Simon Ballard, chief economist at First Abu Dhabi Bank PJSC. “The main focus will be on escalating U.S.-China relations and progress on their trade deal talks.”

In the meantime, U.S. President Donald Trump signed four executive orders to maintain some assistance, including for unemployment benefits, a temporary payroll tax deferral, eviction protection and student-loan relief. Treasury Secretary Steven Mnuchin said he’d listen to any proposal offered by Democrats and Nancy Pelosi said she hopes talks with the White House will resume soon.

“Both parties are going to have to tread very carefully but they are going to have to move on and try to come to some kind of agreement,” Kim Forrest, chief investment officer at Bokeh Capital Partners LLC, said on Bloomberg TV.

Here are some key events coming up:

Earnings include Barrick Gold, SoftBank, Telstra, Deutsche Telekom, Carlsberg, Tencent and JD.com.New Zealand’s policy decision is due on Wednesday.China releases a slew of data for July on Friday, including industrial production and retail sales.U.S. retail sales are expected Friday, with a smaller increase forecast for July than in the prior two months.

These are the main moves in markets:

Stocks

Futures on the S&P 500 Index were little changed at 8:12 a.m. London time.The Stoxx Europe 600 Index rose 0.3%.The MSCI Asia Pacific Index increased 0.1%.The MSCI Emerging Market Index declined 0.1%.

Currencies

The Bloomberg Dollar Spot Index rose 0.1%.The euro sank 0.1% to $1.1773.The British pound gained 0.1% to $1.3063.The Japanese yen weakened 0.1% to 105.98 per dollar.The offshore yuan was little changed at 6.9686 per dollar.

Bonds

The yield on 10-year Treasuries gained one basis point to 0.57%.The yield on two-year Treasuries declined less than one basis point to 0.13%.Germany’s 10-year yield rose one basis point to -0.50%.Britain’s 10-year yield jumped two basis points to 0.16%.Japan’s 10-year yield dipped one basis point to 0.012%.

Commodities

West Texas Intermediate crude gained 0.3% to $41.71 a barrel.Brent crude climbed 0.1% to $44.74 a barrel.Gold weakened 0.2% to $2,031.97 an ounce.

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