Asia Morning: U.S. Stocks Pause Rally

Market sentiment is dampened by news reports that Johnson & Johnson and Eli Lilly are respectively halting trials on their COVID-19 treatments...

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On Tuesday, U.S. stocks paused their recent rally. The Dow Jones Industrial Average declined 157 points (-0.55%) to 28679, the S&P 500 slipped 22 points (-0.63%) to 3511, and the Nasdaq 100 dipped 4 points to 12083.


Dow Jones Industrial Average (Daily Chart): Watch Record Close at 29550


Sources: GAIN Capital, TradingView


Market sentiment was dampened by news reports that Johnson & Johnson (JNJ -2.60%) and Eli Lilly (LLY -2.85%) were respectively halting trials on their COVID-19 treatments.

Banks (-2.72%), Insurance (-2.47%) and Technology Hardware & Equipment (-2.35%) sectors lost the most. Cruise-ship stocks -- Royal Caribbean Cruises (RCL -13.20%), Norwegian Cruise Line (NCLH -8.24%) and Carnival (CCL -7.76%) -- were top losers.

JPMorgan Chase (JPM -1.62%) and Citigroup (C -4.73%) declined after reporting third-quarter earnings. 

U.S. official data showed that Consumer Prices grew 0.2% on month in September (as expected).

European stocks were broadly lower. The Stoxx Europe 600 Index fell 0.55%, Germany's DAX 30 sank 0.91%, France's CAC 40 lost 0.64%, and the U.K.'s FTSE 100 was down 0.53%.

U.S. Treasury prices increased, as the benchmark 10-year Treasury yield fell to 0.726% from 0.775% Friday.

Spot gold dropped $31 (-1.61%) to $1,891 an ounce, pressured by a stronger dollar.

Oil prices were lifted by upbeat Chinese trade data. U.S. WTI crude futures (November) rose $0.76 (+1.93%) to $40.19 a barrel.

On the forex front, the U.S. dollar regained some strength against other major currencies, as setbacks in trials of COVID-19 treatments and deadlocked talks on new fiscal stimulus drove investors to the safe-haven currency. The ICE Dollar Index jumped 0.53% to 93.53, the biggest increase in three weeks. 

Both the euro and the British pound weakened against the dollar as Brexit talks did not yield sufficient progress. Investors were also concerned with resurging coronavirus cases in both the U.K. and Europe. EUR/USD dropped 0.56% to 1.1745, and GBP/USD fell 0.97% to 1.2937 ending a four-day rally.

USD/JPY rebounded 0.13% to 105.47.

Official data showed that China's exports rose 9.9% on year in September (+10.0% expected) and imports jumped 13.2% (+0.4% expected). However, the Australian dollar was dragged by reports that China has banned imports of Australian coal. AUD/USD was down for a second day as it shed 0.67% to 0.7160 

USD/CAD rebounded 0.19% 1.3139 halting a four-day decline.

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