European stocks edge up after Wall Street record; gold drops

Bloomberg

European stocks turned higher with US futures as investors signalled continued optimism in the post-pandemic rally after shares hit all-time highs on Wall Street. Gold slipped back below $2,000 an ounce.
Gains in food shares including Nestle SA countered declines in insurers on the Stoxx Europe 600 Index. Contracts on both the S&P 500 and Nasdaq 100 swings to green from red after the benchmarks closed at records. The dollar held five days of declines against its major peers while Treasuries rose before the Federal Reserve releases minutes of its July open-market committee meeting that may give clues about inflation targeting.
Asia stocks were mixed. Sentiment was dampened by lingering questions over the future of the US-China trade pact after President Donald Trump said he called off last weekend’s trade talks. Hong Kong’s morning session was cancelled due to a typhoon; shares fell when trading resumed.
Massive stimulus injections and a surge in technology companies have propelled the rebound in American equities from a pandemic-induced selloff. US coronavirus case numbers improved, as evidence grew that the peak of the flareup across Sunbelt states is over. Even with stimulus talks stalled, better-than-feared economic data and corporate earnings are instilling optimism that a recovery is taking shape, provided monetary easing
continues.
“We have a Federal Reserve that is all in, keeping rates low probably across the curve for as far as the eye can see,” Katie Nixon, chief investment officer at Northern Trust Wealth Management, said on Bloomberg TV. “That is supportive of higher valuations.”
House Speaker Nancy Pelosi suggested that Democrats might be willing to make more cuts to their stimulus proposal to seal a deal with Republicans and speed Covid-19 relief, then come back after the November elections with additional agenda items.
Meanwhile, China denounced America’s latest moves to curb Huawei Technologies Co.’s access to commercially available chips, the latest blow in an increasingly tense relationship between the world’s two biggest economies.
Elsewhere, crude oil eased after a report signalled surging US gasoline stockpiles before Opec and its allies meet to
assess its supply agreement.
The Stoxx Europe 600 Index gained 0.2% as of 9:33 am London time and futures on the S&P 500 Index increased 0.1%.
While Nasdaq 100 Index futures climbed 0.1%, the MSCI Asia Pacific Index was little changed.
The Bloomberg Dollar Spot Index dipped 0.1% and sterling strengthened 0.1% to 0.9007 per euro. While The Japanese yen was little changed at 105.44 per dollar. New Zealand’s dollar gained 0.5% to $0.6636.
The yield on 10-year Treasuries decreased two basis points to 0.65% and the yield on two-year Treasuries fell less than one basis point to 0.14%.
While Britain’s 10-year yield dipped two basis points to 0.202%, Germany’s 10-year yield declined two basis points to -0.48%.
West Texas Intermediate crude dipped 0.9% to $42.49 a barrel and gold weakened 0.6% to $1,989.75 an ounce. While silver weakened 0.8% to $27.46 per ounce, LME zinc gained 1.2% to $2,487.50 per metric ton.