Stocks Notch Record Highs; Treasury Yields Climb

US equities rose to all-time highs for a third day with investors counting on the Federal Reserve to stay accommodative as the economy recovers from the coronavirus pandemic. The S&P 500 rose by 0.4% to 3,443.62 while Dow Jones was down 60.02 points (0.2%) to 28,248.44.

US New-home Sales Surge to Highest Since December 2006

New-home sales in the US jumped to the highest level in almost 14 years in July as low mortgage rates helped fuel a suburban construction boom. Purchases of new single-family houses climbed 13.9% from June to a 901,000 annualized pace from an upwardly revised 791,000, government data showed. The median selling price rose 7.2% from a year earlier to US$330,600.

US Consumer Confidence Hits Six-year Low on Drag From Pandemic

US consumer confidence dropped in August to the lowest since 2014 as consumers soured on employment and business conditions, indicating Americans are becoming despondent amid persistently high joblessness. The Conference Board’s index decreased to 84.8, the lowest level since the pandemic began, from a revised 91.7 in the prior month, according to a report.

Germany Extends Job-preserving Aid to Underpin Crisis Recovery

Germany extended a program that has kept millions of people from losing their jobs to help Europe’s biggest economy recover from the coronavirus crisis. At a meeting in Berlin, Chancellor Angela Merkel’s coalition agreed to provide job-preserving subsidies until the end of 2021. The subsidies, originally intended for 12 months, pay the bulk of paychecks and allow companies to hold on to workers during an economic shock.

India’s Central Bank Sees Demand Recovery Taking More Time

India’s central bank said demand in the economy is likely to take more time to mend in the absence of greater fiscal support, even as the government is constrained in its ability to provide more stimulus.“An assessment of aggregate demand during the year so far suggests that the shock to consumption is severe,” the Reserve Bank of India said in its annual report for the year ended June.

Thailand Turns to Faster Road and Rail Spending to Prop Up Economy

Thailand’s Transport Ministry plans to accelerate spending on roads and rail projects in the fiscal year starting in October to aid an economy hammered by a slump in exports and tourism. Key programs include expansion of Bangkok’s mass-transit network and expressways linking several nearby provinces and the nation’s eastern seaboard to Bangkok.

Philippine Congress Approves US$3.4bn Pandemic Relief

The Philippines’ House of Representatives approved the final version of a 165.5bnpeso (US$3.4bn) pandemic relief bill that would provide subsidies to the unemployed, loans to businesses and payment deferral for borrowers. The measure, which would also extend President Rodrigo Duterte’s authority to refocus funds in this year’s 4.1 trillion-peso budget, will be sent to him for signature after the Senate’s approval last week.

Oil, Gasoline Climb to Five-month Highs With Hurricane Nearing

Crude and gasoline futures both climbed to levels not seen since before the pandemic as Hurricane Laura rattled toward a key stretch of the US Gulf Coast that is home to the nation’s greatest concentration of refining capacity. Brent crude for October settlement gain US$0.73 to US$45.86 per barrel

Source: Affin Hwang Research - 26 Aug 2020