Dollar Steady, With Stocks Trading Mixed; Oil Up

The dollar was steady at the start of the trading week and stocks traded mixed as investors weighed uncertainty over the timing of a stimulus package from Washington and looked ahead to this week’s expected review of the U.S.-China trade pact. Oil climbed.

Shares in Hong Kong retreated, with Tencent Holdings Ltd. seeing more losses following Friday’s plunge. S&P 500 futures fluctuated, while equities in South Korea and Australia climbed. Japan and Singapore are shut for holidays and Treasuries won’t trade until the London open. Crude advanced as Saudi Arabia’s state-controlled producer said it expects energy demand to pick up. Gold slipped.

The Bloomberg dollar index has resumed its downward trend

Investors are grappling with an unclear timeline, with neither Democrats nor Republicans giving a firm date after reaching an impasse last week. The two sides are trillions of dollars apart on overall spending and on key issues, including on aid to state and local governments and the amount of supplementary unemployment benefits.

“The delay in announcing the U.S. virus relief package of over $1 trillion has put more pressure on the U.S. economy,” said Simon Ballard, chief economist at First Abu Dhabi Bank PJSC. “The main focus will be on escalating U.S.-China relations and progress on their trade deal talks.”

In the meantime, U.S. President Donald Trump signed four executive orders related to maintain some assistance, including unemployment benefits, a temporary payroll tax deferral, eviction protection and student-loan relief. Treasury Secretary Steven Mnuchin said he’d listen to any proposal offered by Democrats and Nancy Pelosi said she hopes talks with the White House will resume soon.

“Both parties are going to have to tread very carefully but they are going to have to move on and try to come to some kind of agreement,” Kim Forrest, chief investment officer at Bokeh Capital Partners LLC, said on Bloomberg TV.

The U.S. passed 5 million coronavirus infections after adding 1 million new cases in just over two weeks. Germany’s transmission rate rose to the highest level in 10 days. Paris will mandate masks outdoors on its busiest streets starting Monday.

Data Monday showed China’s economy continuing to recover from the pandemic, with consumer inflation accelerating and factory price deflation easing.

Here are some key events coming up:

Earnings include Barrick Gold, SoftBank, Telstra, Deutsche Telekom, Carlsberg, Tencent and JD.com.
New Zealand’s policy decision is due on Wednesday.
China releases a slew of data for July on Friday, including industrial production and retail sales.
U.S. retail sales are expected Friday, with a smaller increase forecast for July than in the prior two months.

These are the main moves in markets:

Stocks

Futures on the S&P 500 added 0.1% as of 10:52 a.m. in Hong Kong. The index rose 0.1% on Friday.
Hong Kong’s Hang Seng index slid 0.5%.
Shanghai Composite rose 0.2%.
Australia’s S&P/ASX 200 Index advanced 1.3%.
South Korea’s Kospi index added 1%.
Euro Stoxx 50 futures rose 0.6%.

Currencies

The yen rose 0.1% to 105.79 per dollar.
The offshore yuan traded at 6.9668 per dollar, little changed.
The euro bought $1.1793.
The Australian dollar was at 71.66 U.S. cents, up 0.1%.

Bonds

The yield on 10-year Treasuries rose more than two basis points to 0.56% on Friday. Futures were little changed Monday.
Australia’s 10-year yield added three basis points to 0.86% on Monday.