GLOBAL NEWS

Stocks Rally as Dip Buying Intensifies After Rout

Stocks climbed as dip buyers appeared after the market slide and traders awaited developments on US stimulus talks. The S&P 500 rose by 1.6% to 3,298.46 while Dow Jones was up 358.52 points (1.34%) to 27,173.96.

Pelosi Says Democrats Will Make New Aid ‘proffer’ to Mnuchin

Speaker Nancy Pelosi said there’s a chance she and Treasury Secretary Mnuchin can still reach a deal on a coronavirus stimulus package, and that Democrats will unveil a new “proffer” shortly. She added that if a deal isn’t struck soon, Democrats might vote on a House-only version of a coronavirus relief package, including funds for airlines and restaurants, and more Paycheck Protection Program funding. “The public is going to have to see why US$2.2trn, or now US$2.4trn perhaps, is necessary,” she said.

US Imposes Restrictions on Exports to China’s Top Chipmaker

The US imposed export restrictions on Semiconductor Manufacturing International Corp., taking aim at another prominent Chinese technology company and adding to tensions between the two countries over the critical industry. US firms must now apply for a license to export certain products to China’s largest chipmaker, the Commerce Dept. said in letter.

BOE’s Tenreyro Sees ‘encouraging’ Evidence on Negative Rates

The Bank of England’s discussions on negative interest rates have been “encouraging,” according to policy maker Silvana Tenreyro, in a sign that the UK could yet follow peers such as the European Central Bank below zero. “There has been almost full pass-through of negative rates into lending rates in most countries,” Tenreyro said.

ECB’s Lagarde Warns Against Withdrawing Fiscal Stimulus Too Soon

European Central Bank President Christine Lagarde said governments risk delaying the rebound from the coronavirus slump if they end support prematurely. The eventual withdrawal of fiscal aid such as furlough programs for workers is a source of uncertainty and it must be carefully aligned with a pickup in activity, Lagarde said. “This very subtle synchronization that is needed will be the trigger to either success or very slow-going recovery,” she added.

Chinese Industrial Companies’ Profit Grows for Fourth Month

Profits at Chinese industrial enterprises grew for a fourth consecutive month, as the country’s factories maintained momentum following the pandemic shutdown. Industrial profits rose 19% in August, after July’s 19.6% increase, data from the National Bureau of Statistics showed. For the first eight months of the year, it was still down 4.4% from a year earlier.

Australia Banks Surge as Lending Laws Eased to Boost Economy

Australia will make it easier for banks to approve mortgages and small-business loans to help the economy recover from its first recession in almost 30 years. As part of a sweeping overhaul of so-called responsible lending obligations, the government will allow banks to rely on income and spending information provided by borrowers when assessing loan applications, rather than doing their own lengthy verifications, Treasurer Josh Frydenberg said.

Oil Dips on Signs That Virus Measures Are Slowing Recovery

Oil slipped to near US$40 amid signals that coronavirus restrictions will slow the economic recovery and on signs of increased supply. Brent crude for November settlement rose US$0.02 to US$41.94 per barrel.

Source: Affin Hwang Research - 28 Sept 2020