GLOBAL MARKETS-Equities edge lower, safe havens rise, as U.S. stimulus talks stall

By David Randall
NEW YORK, July 28 (Reuters) - An impasse in U.S. stimulus
negotiations and mixed corporate earnings reports in Europe
pushed global equities lower and sent investors into perceived
safe-haven assets like government bonds and gold, which hovered
near record highs.
Senate Republicans announced on Monday a $1 trillion
coronavirus aid package hammered out with the White House, which
Senate Majority Leader Mitch McConnell touted as a "tailored and
targeted" plan to reopen schools and businesses.
But the proposal sparked immediate opposition from both
Democrats, who called it too limited compared with their $3
trillion proposal that passed the House of Representatives in
May, and some Republicans who called it too expensive.
Enhanced unemployment benefits expire on Friday, which would
be a blow to household incomes and spending power.
Some 30 million Americans are out of work and states are
tightening lockdown restrictions again, a trend that has also
dragged on the U.S. dollar.
Alan Ruskin, head of G10 strategy at Deutsche Bank, noted
currencies had been tracking the relative performance of their
economies, so that high-ranked economic performance was
associated with stronger currencies.
"One clear pattern is how economies linked most tightly to
China -- including commodity producers as diverse as Australia,
Chile and Brazil -- have tended to perform better than economies
most directly linked to the U.S., notably its NAFTA trading
partners," said Ruskin.
MSCI's gauge of stocks across the globe .MIWD00000PUS shed
0.08% following modest declines in Asia and Europe, where
disappointing earnings results from luxury good makers weighed
on investor sentiment. In morning trading on Wall Street, the Dow Jones Industrial
Average .DJI fell 86.85 points, or 0.33%, to 26,497.92, the
S&P 500 .SPX lost 3.82 points, or 0.12%, to 3,235.59 and the
Nasdaq Composite .IXIC dropped 30.13 points, or 0.29%, to
10,506.14.
The rest of the week will see 179 S&P 500 companies
reporting second-quarter earnings, including Google, Amazon and
Apple.
Spot gold XAU= dropped 0.2% to $1,937.49 an ounce. U.S.
gold futures GCc1 gained 0.03% to $1,931.50 an ounce.
Gold is still up over $125 in little more than a week as
investors bet the Federal Reserve will reaffirm its super-
accommodative policies at its meeting this week, and perhaps
signal a tolerance for higher inflation in the long run.
"Fed officials have made clear that they will be making
their forward guidance more dovish and outcome-based soon,"
wrote analysts at TD Securities. "The chairman is likely to
continue the process of prepping markets for changes when he
speaks at his press conference."
The dollar has been falling almost across the board for a
month. It reached a two-year low against a basket of currencies
at 93.416 overnight before recovering to 93.975 =USD .DXY .
The euro EUR= dropped back to $1.1715 after rising to its
highest in two years at $1.1781. The dollar had touched its
lowest against the Swiss franc since mid-2015 CHF= . It also
fell to a four-month low of 105.10 against the Japanese yen
JPY= before squatting at 105.25.
Benchmark 10-year notes US10YT=RR last rose 5/32 in price
to yield 0.5921%, from 0.609% late on Monday.
Oil prices were mixed as investors weighed hopes for a U.S.
stimulus package with declining demand. U.S. crude CLc1 recently fell 0.94% to $41.21 per barrel
and Brent LCOc1 was at $43.36, down 0.12% on the day.

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Global assets http://tmsnrt.rs/2jvdmXl
Global currencies vs. dollar http://tmsnrt.rs/2egbfVh
Emerging markets http://tmsnrt.rs/2ihRugV
MSCI All Country Wolrd Index Market Cap http://tmsnrt.rs/2EmTD6j
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