Today the total number of coronavirus cases surpassed 16.6 million. The United States is close to the 4.5 million milestone and continues to add 60,000 new cases to its tally each day. The situation also remains critical in India and Brazil. There have been slightly fewer daily increases in Russia over the past couple of days but now South Africa stands out as a major epicenter of the disease.
The markets are a bit calmer about the coronavirus today, though, due to the announcement that two of the most promising vaccines are entering the next stage of development. If they pass through the next stage of trials, there might be a vaccine available before the year’s end.
The seriousness of the outbreak in the United States is continuing to pressure the domestic labour market. This week the previous stimulus which provided direct payments to American households, plus extra money towards the welfare of the unemployed segment of the population is expiring.
The Republican Party has proposed a $1 trillion stimulus package to continue these social programs after the current funds expire. The proposal includes decreasing the sum people receive per week from September in order to prevent them from becoming dependent on welfare and encourage them to look for jobs.
The Democrat Party has its own proposal which is much more generous and addresses more areas that need support from the government. Dems consider the Republican plan to be insufficient. However, because each party controls a different chamber of Congress, the two will need to negotiate a compromise since time is running out.
In terms of the economic calendar, today Spain published the unemployment rate for the second quarter of 2020, which came in at 15.33%. The number is quite high but it is lower than the forecasted 16.7% unemployment, showing that the country that was worst-affected by the coronavirus in Europe is recovering better than expected.
The European single currency continues its rally against the dollar, backed by good data in Europe. The USD is under too much pressure from the Covid-19 pandemic and the slow recovery of the US economy.
Today the earnings reports will be in abundance, giving traders a chance to make a profit from buying or selling stocks. Some of the biggest companies reporting today include AMD, Visa, Starbucks, and McDonald’s, among others.
