NEW YORK, Oct 20 — The US dollar rose against the euro yesterday, ahead of a European Central Bank meeting later this week, while stocks on major world markets ended little changed despite further news of slowing Chinese economic growth.
US stocks ended little changed but investors concern about the poor quality of third quarter earnings reports.
“People are waiting for an onslaught of earnings,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.
“There’s been enough negative guidance about the future to make people skeptical about the direction of the market.”
Several Dow components are posting quarterly results this week, including Caterpillar, Boeing and Coca-Cola.
S&P 500 index stock earnings are expected to have declined about 4.0 per cent in the third quarter from a year ago, according to Thomson Reuters data.
Morgan Stanley’s profit plunged 42 per cent, after a poor quarter for big US banks and the bank’s stock ended down 4.8 per cent.
The Dow Jones industrial average rose 14.57 points, or 0.08 per cent, to 17,230.54, the S&P 500 index gained 0.55 points, or 0.03 per cent, to 2,033.66 and the Nasdaq Composite added 18.78 points, or 0.38 per cent, to 4,905.47.
US dollar strong
The euro retreated to a 10-day low against the US dollar as investors focused on a European Central Bank meeting later in the week that could pave the way for further stimulus to boost inflation in the euro zone.
The US dollar index, which measures the greenback against a basket of six major currencies, was last up 0.46 per cent at 94.968.
“I think the ECB on Thursday will push back against euro strength,” said Mark McCormick, currency strategist at Credit Agricole in New York.
“We do not expect them to announce a new program, but perhaps lay the groundwork for an extension of quantitative easing.”
The stronger US dollar and news of slower Chinese growth pressured oil prices which fell about 4.0 per cent.
China’s economic growth slowed to 6.9 per cent in the third quarter, still ahead of the 6.8 per cent forecast.
On the US stockmarket, the energy index fell 1.9 per cent as US crude oil prices fell 2.9 per cent.
Exxon XOM.N fell 1.8 per cent to US$80.99 (RM347.48) and Chevron CVX.N fell 1.4 per cent to US$90.03, the biggest drags on the S&P 500 and the Dow.
“Energy and oil prices were down today, the industrials and materials sectors, so that took a little bit off the enthusiasm for equities,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.
The MSCI world equity index, which tracks 46 key global markets, was last down 0.17 per cent, while the pan-regional FTSEurofirst 300 index closed up 0.21 per cent.
US 30-year Treasury yields rose to a nearly one-week high of 2.91 per cent. In futures trading, US gold for December delivery was down 0.9 per cent at US$1,172.80 an ounce. — Reuters
