The US stock market exhibited strength again at the opening of the week. Many stocks are trading at the highs of the year. Small losses incurred after the opening were erased and the stock market closed at new highs. The Dow Jones and the S&P 500 index rose by 0.24%, while the NASDAQ Composite remained unchanged.
Asian stock markets closed mixed on Tuesday morning: Japan's indices added 0.5% while China's indices fell sharply again by 1.4%. China's stock market extended losses on Monday. Following the results of two days, China's main indices dropped by 4.5%.
Oil continued to recover after last week's deep fall. Brent crude consolidated at 74.60 amid a rally of US stocks.
The coronavirus pandemic remains the main risk for the global economy. Yesterday, there were 450,000 new cases in the world. The new wave of coronavirus, which began in July, is noticeably weaker than the previous wave that started in late April and early May of this year. Mass vaccination in many countries brought results. In countries with a high vaccination rate, there has been a significant drop in new coronavirus cases. Besides, the death toll also remains low. Yesterday, the UK, Britain, Russia, and Spain recorded the least number of new cases. There were only 25,000 cases.
The S&P 500 index was trading in the range of 4,380-4,440. Some analysts note quite an interesting trend in sock markets. US indices are at highs. The US equity market has grown since the beginning of the year by 17%, while stock markets in other countries remain at the lows of the year. China's stock indices have not risen since January 1. Tesla published its earnings report. In the 2nd quarter, its net profit increased 11 times to $1.14 billion.
Intel Corporation, a chip giant, plans to regain its leadership in the production of the most advanced chips. CEO Pat Gelsinger said yesterday that Intel would launch a new central processing every year from 2021 to 2025. Now Intel is lagging behind two main competitors -Taiwan Semiconductor and Samsung Electronics. "Building on Intel's unquestioned leadership in advanced packaging, we are accelerating our innovation roadmap to ensure we are on a clear path to process performance leadership by 2025," Intel CEO Pat Gelsinger said
The Fed's two-day monetary policy meeting has begun today. The decision on the key rate will be made late on Wednesday. The main question is whether the Fed will change its ultra-soft policy after the consumer price index reached the level of 5.4%.
The US dollar index is trading at 92.70. It is likely to stay in the narrow range of 92.40 - 93.00 until the Fed's decisions on the key rate. In the Fed makes hints about a possible reduction of the bond-buying program, the US currency may develop a strong rally, heading for 94.00 and higher.
The USD/CAD pair is trading at 1.2570. It is likely to in remain the range of 1.2500-1.2620. The US dollar weakened against the Canadian dollar. However, if the Fed make some adjustments o its monetary policy tomorrow, the greenback will soar. Yet, oil prices may decrease. If so, the pair may again return to the level of 1.2800.
For this reason, market participants are anticipating the Fed's meeting results with bated breath as they are sire to influence various markets and quotes of many currencies.
