US markets 1% lower on historic Q2 GDP contraction

Vrasidas Neofytou

Vrasidas Neofytou
Head of Investment Research

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Market Brief, Friday, 31st of July, 2020

Dow Jones index fell 1% on Thursday after the US government released the worst quarterly Gross Domestic Product print on record in the second quarter, while the weekly unemployment insurance claims increased for a second straight week.

US dollar was weaker across the board on Thursday, extending its downward trend, as the record slump in the GDP data, underscores the deep economic impact of the coronavirus in the US economy coupled with news that the US President Donald Trump raised the possibility of delaying the November election.

However, Nasdaq Composite futures jumped 1% on overnight trading after some of the biggest tech names such as Facebook, Amazon, Alphabet, and Apple, reported better-than-expected earnings and double-digit revenue growth for the second quarter of the year.

Asian markets were lower this morning following the overnight losses from Wall Street. Nikkei index led the losses with 2% after record spikes in COVID-19 cases in Tokyo coupled with a stronger Japanese Yen.

Gold prices rose 1% on Friday morning, as the dovish policies from the Federal Reserve, the weaker US dollar, and the resurgence of COVID-19 cases drove investors towards the safe-haven metal.

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