- GBP Advances on Improving Brexit Sentiment
- Dollar Weakness Continues as Case Numbers Push Higher
- Stock Market Remains Positive Amid Strong Earnings Reports
Major currencies in the forex market have continued to take advantage of a weakening US Dollar. Both the Pound and the Euro advanced further against the Greenback as cases of coronavirus across the country also remain persistently high. While this has hampered recovery efforts, markets continue to perform well with another positive day projected on Tuesday and the possibility that the S&P 500 could reach record levels as many retailers, including Walmart, beat earning expectations for the quarter.
Positive Brexit Hopes Boost Sterling
The GBP/USD continued to march on Tuesday. The pair is looking to secure a fourth consecutive day of gains as the under par US Dollar, and a more positive tone around the upcoming Brexit negotiations with the EU are in focus. It has been quite a while since forex brokers have seen such positive momentum for the Pound with hopes that the seventh round of EU talks can finally help get a deal over the line.
Chief negotiator for the UK side of the talks, David Frost, was confident that a trade deal between the UK and EU could be reached in September. This then, places great attention on the resumption of talks between the parties in Brussels today. If a deal could be reached soon, Sterling forex traders would certainly see the strength against the Dollar continue on its positive run.
US Case Numbers Remain High With No Stimulus in Sight
Covid-19 cases continue to remain high across the US remain high with an average of more than 50,000 new cases per day across the nation. This has continued to restrict progress to return to normal life even though many schools and universities have already started to return for the new semester. With more than 5 million cases reported, the US has by far the highest number of registered cases of any world country.
This is all happening against a backdrop of unrest as US-China tensions continue to rise, and a second stimulus package looks like being delayed until at least September with congress failing to reach agreement. All of these factors together with the approaching election have seemingly contributed to a lack of confidence in the US Dollar the like of which has not been seen for many years.
Markets Move Higher on Impressive Retail Numbers
Even though the US Dollar market has been weakened, the equities market continues to show great resilience. Wall Street is expected to open higher again on Tuesday with the S&P 500 looking to eclipse the all-time high it set in only February.
The main proponents of continued optimism here include major retailers like Walmart who reported huge gains in almost doubling their ecommerce sales for the quarter. This figure, together with an earnings per share of $1.56 which also beat expectations have the company riding high in the market alongside others such as Home Depot who have come in impressively above target to give the overall market a lift today.