Tech Rout Sends Stocks to Worst Week Since March

US stocks dropped, capping their biggest weekly rout since March, after earnings from the largest tech companies disappointed investors concerned that a slowing economy will damp profit. The S&P 500 fell by 1.21% to 3,269.96 while Dow Jones was down 157.51 points (0.59%) to 26,501.60.

US Consumer Sentiment Edged Up in Late October, Still Low

US consumer sentiment edged up slightly in late October while remaining well below pre-pandemic levels, suggesting Americans’ anxiety over Covid-19 is persisting just before the election. The University of Michigan’s final sentiment index for October was 81.8, compared with a preliminary reading of 81.2 early in the month and September’s final reading of 80.4, according to data.

US Personal Income, Spending Increase by More Than Forecast

Americans’ incomes increased in September by more than expected, boosted by employment gains and helping to propel consumer spending at the end of the third quarter. Personal incomes rose 0.9% from the prior month following a 2.5% decline in August, a Commerce Department report showed. That compared with estimates for a 0.4% gain. Household outlays advanced 1.4%, also exceeding forecasts.

ECB’s Holzmann Sees Quality of Stimulus in Focus in December

The European Central Bank’s stimulus revamp in December should focus on increasing the effectiveness of the tools rather than just their size, according to policy maker Robert Holzmann. While the Austrian central bank governor acknowledged that it’s right to assume ECB President Christine Lagarde signaled more policy easing, he may be warning the market against expectations of a large increase in bond-buying.

Korea Export Recovery Continues With Daily Shipments Rising

South Korea’s exports recovery continued in October with daily shipments pointing to a continued pickup in overseas demand, even though a national holiday reduced working days and hurt headline figures. The value of total shipments abroad fell 3.6% from a year earlier, the trade ministry said. Economists had forecast a 3.5% decline. Average daily shipments still rose 5.6%, with the period having two fewer business days than last year.

Singapore Unemployment Rises to 16-year High

Singapore’s overall unemployment rate in the third quarter rose to 3.6%, the highest since 2004, reflecting the sustained challenges to its economy from the coronavirus pandemic. The Monetary Authority of Singapore said that the city-state’s recovery will likely be “gradual and uneven” and that the labor market is expected to “only expand gradually” next year. The central bank sees the economy contracting by 5% to 7% this year.

Indonesia’s Capital Raises Minimum Wages for Some Businesses

Indonesia’s capital Jakarta will increase minimum wages next year for select businesses despite a government advisory to keep pay unchanged to avoid further job losses during the pandemic. The minimum wage will rise by 3.27% to 4.42 million rupiah (US$302) in 2021 for workers in businesses less impacted by the virus outbreak, according to Governor Anies Baswedan.

Oil Has Worst Month Since March After Covid Surge Hurts Recovery

Oil posted its largest monthly drop since March as renewed lockdown measures to contain the coronavirus threatened to upend a shaky demand recovery. Brent crude for December settlement lost by US$0.19 to US$37.46 per barrel.

Source: Affin Hwang Research - 2 Nov 2020