The rise in Covid cases continues to hamper sentiment, with dollar strength and falling treasury yields undermining the gains in stocks. In the UK, reopening stocks and housebuilders lead the gains. 

  • Stocks regain ground, yet weak yields and a rising dollar highlight ongoing anxiety 
  • Reopening stocks likely to remain at forefront of volatility 
  • Housebuilders benefit from easing fears of monetary tightening

US markets have followed their European counterparts higher today, with traders opting to buy the dip in the wake of yesterday’s sharp decline. Fears around the rise of the Delta variant remain evident despite today’s reprieve, with a five-month low for the US 10-year highlighting the lack of full conviction behind this move. We are also seeing that risk-off sentiment exhibited throughout the FX-markets, with GBPUSD hitting a five-month low thanks to rising UK Covid cases and haven dollar demand. Crude prices have stabilised somewhat after a dramatic collapse in energy prices yesterday, with OPEC expected to gradually ramp-up demand in the months ahead.  

The recent UK market volatility has seen reopening stocks swing between outperformers and underperformers as investor sentiment shifts on a daily basis. Despite fears that the Delta variant could undermine travel and consumer activity, today’s gains for the likes of Rolls-Royce, Hammerson, and Cineworld highlight how reopening stocks are likely to be at the forefront of recent volatility. Housebuilders has been one sector in favour today, with the fall in treasury yields highlighting how many perceive this recent rise in Covid cases as lessening the risk of inflation-led monetary tightening. 

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Feed news

How do emotions affect trade?
Follow up our daily analysts guidance

Subscribe Today!    

Latest Forex Analysis


Latest Forex Analysis

Editors’ Picks

EUR/USD remains pressured after US data misses estimates

EUR/USD is trading closer to 1.1750, paring its recovery from earlier in the day as the safe-haven dollar is bid. US Consumer Sentiment missed estimates with 72 points in September. The financial woes of China's Evergrande are weighing on sentiment.

EUR/USD News

GBP/USD trades under 1.38 amid on UK data, dollar strength

GBP/USD is on the back foot, trading under 1.38 after UK Retail Sales figures disappointed with -0.9% in August, worse than expected. Brexit uncertainty and dollar demand weighed on the pair earlier. 

GBP/USD News

XAU/USD surrenders intraday gains, drops closer to $1,750 level

Gold struggled to preserve its intraday gains and dropped to the lower end of the daily trading range during the early North American session. 

Gold News

Experts say Ripple will win SEC lawsuit, which might propel XRP to new all-time highs

The latest development in the ongoing SEC vs. Ripple lawsuit is that documents are classified as privileged and blocked for public viewing. Though institutional investors are yet to take big bets on the altcoin in 2021, retail investors are actively trading in XRP.

Read more

US Michigan Consumer Sentiment Preview: Markets will have to look hard for positive signs

Consumer outlook expected to rebound to 72.2 in September. August’s 70.2 was the lowest since December 2011. Inflation and Delta variant wearing on US optimism. Markets face negative dollar risk from fading consumer optimism.

Read more

Majors

Cryptocurrencies

Signatures