The S&P 500 index may reclaim its record high again for a second time in 10 days.
The weekend G20 meeting, which called for a truce between the United States and China, and positive signs from Russia and Saudi Arabia on oil output cut extension may just be enough for another rally in major US indices.
The S&P 500 index hit a record of 2,964.15 on June 20, and closed 0.58 per cent higher at 2,941.76 on Friday. The Dow Jones Industrial Average ended 0.28 per cent higher at 26,599.96.
“The markets G-20 base case scenario was doubtlessly validated on Saturday as the US will hold off raising tariffs while negotiations to end the trade war between the two countries continue. This will likely come as a relief to markets and should anchor sentiment in the short term,” said Stephen Innes, Managing Partner at Vanguard Markets Pte Ltd.
Donald Trump, the US president hailed trade talks with his Chinese counterpart Xi Jinping as “far better than expected” and vowed to hold off on further tariffs as negotiations continue.
The rally in equities saw a revival after the Federal Reserve gave a dovish stance, indicating a rate cut amid sluggish growth even as a cloud of trade war loomed. For the year, the Dow and S&P 500 are up 14 per cent and 17 per cent respectively, while the tech-heavy Nasdaq has jumped 20.6 per cent.
Meanwhile, the MSCI emerging market index has gained only 0.78 per cent in the past one year.
Investors in gold, which has reclaimed its safe haven status, may go in wait and watch mode.
Gold futures on Comex ended flat at $1,412.50 an ounce. “Given everything that we’re seeing at the moment, gold is very much displaying the characteristics it’s been long associated with. As the Federal Reserve prepares to cut rates, global economy faces a slowdown and tensions flare in the Middle East, the safe haven, inflation hedge and store of value is performing admirably,” Craig Erlam, Senior Market Analyst, UK & EMEA at OANDA said.
Prices surpassed the key psychological $1,400 level earlier this week to reach $1,438.63 for the first time in six years. Gold has gained 9.95 per cent in the year so far.
“Gold investors won’t be so quick to back up the truck on Monday likely deferring to a wait-and-see approach while gauging the veracity of an expected clear-out of long Gold positions that are expected to unfold,” Innes said.
Bitcoin prices massive fluctuation of $1,000 in a trading session after hitting $14,000 last week.
“Bitcoin may see a decline towards 10,500/10,000, but this can be used as an opportunity to buy,” Capital TA, a research firm, said on its Twitter handle.
Bitcoin prices hit a high of $14,000 on Wednesday, but witnessed profit-taking to a low of $10,400.
On Sunday, Bitcoin prices traded 7.53 per cent lower at $11,097.52.