US Stock Market Overview – Stocks Close Higher, Led Higher by Energy; Confidence Rises More than ExpectedChicago PMI rises less than expected
US stocks closed higher on Tuesday as the Nasdaq continued to rally dragging up the Dow. Concerns about the spread of COVID weighed on hospitality stocks. Most sectors in the S&P 500 index were higher, led by energy, consumer staples bucked the trend. The Fed chair Jerome Powell testified in front of the House Financial panel on Tuesday and warned that there needs to be a solution for companies that cannot take on more debt. Consumer confidence rose more than expected while the Chicago PMI report came in lower than expected. The VIX volatility index moved lower on Tuesday falling to a 2-week low below 31%.
Consumer Confidence Rebounds
Consumer confidence increased more than expected in June as restriction loosened for stay-at-home orders, raising hope for an economic recovery. The Conference Board’s consumer confidence index rose to 98.1 for the month. Expectations had been for consumer confidence to rise to 91 from a May reading of 85.9. The board’s present situation index rose to 86.2 from 68.4 while the short-term outlook among consumers also improved.
Trading Derivatives carries a high level of risk to your capital and you should only trade with money you can afford to lose. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved, and seek independent advice if necessary. A Product Disclosure Statement (PDS) can be obtained either from this website or on request from our offices and should be considered before entering into a transaction with us. Raw Spread accounts offer spreads from 0.0 pips with a commission charge of USD $3.50 per 100k traded. Standard account offer spreads from 1 pips with no additional commission charges. Spreads on CFD indices start at 0.4 points. The information on this site is not directed at residents in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Chicago PMI Survey Comes in Weaker than Expected
The US Chicago purchasing managers index rebounded slightly to 36.6 in June, after falling to a 38-year low in May. Expectations had been for a stronger rebound up to 44.5 from 32.3 in May. This comes a day before the US ISM purchasing managers report which is scheduled to be released on Wednesday.
Goldman Says Facemask Would Increase Growth
Goldman Sachs the investment banking powerhouse said that a federal face mask mandate would not only cut the daily growth rate of new confirmed cases of Covid-19 but could also save the U.S. economy from taking a 5% GDP hit instead of additional lockdowns.
Fed Chair Powell Warns of Continued Economic Weakness
Fed Chair Powell warned of extraordinary uncertainty ahead as the coronavirus continues to spread throughout the United States. In a statement and question and answer session in front of the House financial panel Powell said that a full recovery is unlikely until people are confident that it is safe to re-engage in a broad range of activities.