Coronavirus Aid Package Talks Continue
Coronavirus aid package negotiations are finally showing some signs of progress but there’s clearly more work to be done. At this point, Republicans still want to cut unemployment benefits to $200 per week while Democrats want to keep them at $600 per week.
However, both sides have indicated that a deal may be reached in the upcoming days. Later this week, the market will digest several employment reports, including ADP Employment Change, Initial Jobless Claims, Continuing Jobless Claims, Non Farm Payrolls and Unemployment Rate.
These reports may push lawmakers to reach a deal since Initial Jobless Claims are expected to stay high at 1.4 million while Unemployment Rate is projected to marginally improve to 10.5%.
Meanwhile, S&P 500 futures are losing ground in premarket trading as stocks need more positive catalysts to continue their upside move. A new coronavirus aid package or better-than-expected employment reports could serve as such catalysts at the end of this week.
BP Cuts Its Dividend By 50%
BP has recently reported its second-quarter results, missing analysts estimates on revenue and beating them on GAAP earnings. The company reported revenue of $31.2 billion and GAAP earnings of -$5.00 per share.
The company decided to cut its dividend by 50% as coronavirus pandemic put pressure on both current oil prices and future oil price outlook.
Interestingly, BP shares are up more than 6% in premarket trading. It looks like traders have waited for a dividend cut and are rushing to buy the company’s shares.
U.S. Dollar At Crossroads
The U.S. Dollar Index has stabilized near 93.5 after an unsuccessful attempt to get above the 94 level.
The American currency has lost a lot of ground in July so a recent rebound attempt was not surprising.
The future direction of the U.S. dollar may have a significant impact on stocks and commodities. Additional weakness of the American currency could provide support to stocks and push gold above the $2000 level.
At the same time, the continuation of the rebound may put more pressure on oil, which is especially vulnerable given the continued problems on the coronavirus front that have led to reimposition of virus containment measures in various parts of the world.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire