Last Wednesday, investors were more focused on an anticipated vote in Congress to raise the U.S. debt ceiling, which caused the U.S. Treasury yields and global equities to decline. The bipartisan deal that would lift the $31.4 trillion ceiling and help the government avoid default is scheduled for a vote on Wednesday in the U.S. House of Representatives.
How many Democrats will support it is not known, as the House has more Republicans, so the bill can face a tricky path.
The Chief Market Strategist at Carson Group, Ryan Detrick, said, “The jitters are expected as there is a very small chance there could be an issue with the vote later tonight.” He added that the month-end profit taking was also underway and said, “We don’t anticipate that, but until the final paper is signed on the president’s desk some apprehension isn’t abnormal.”
There was a 0.82% decline in the MSCI world equity index, which tracks shares in 50 countries. The European stock market index fell by 1.07%. The Dow Jones Industrial Average fell by 0.41%, the Nasdaq Composite dropped by 0.63%, and the S&P 500 fell by 0.61%. All the major indexes hit the bottom on Wall Street, which are driven by industrial stocks, financials, a sell-off in technology, and consumer discretionary.
The unexpected increase in job openings and remarks by Federal Reserve officials about the rate hike can be skipped at its next meetings, including vice chair nominee Philip Jefferson, which made the U.S. Treasury yields decline. The 10-year note yield benchmark slipped to 3.6407%.
The dollar index increased by 0.163%, while the euro declined by 0.44%. The dollar fell from its earlier two-month high after the comments by the Fed. As a result of the weak economic data from the top importer of oil, China, oil prices fell. U.S. West Texas Intermediate crude came down by 2%, whereas Brent crude futures settled down to $1.11.
Due to optimism about the U.S. debt, the bullion remained on course for its first month after a three-month decline. Despite the dollar surge, the gold price increased. U.S. gold futures increased by 0.29%, whereas spot gold gained 0.2%.
