DOW Closes Lower, But 6% off Record High

U.S stocks indexes did finish off the day on Tuesday, mostly in record territory, despite continued wrangling between Democrats and Republicans over further fiscal stimulus packages and concerns about how the economy will fare when an unprecedented raft of fiscal stimulus eventually burns off. The Dow fell 86.11 points, or 0.3%, to end at 27,844.91 away from its record close while the Nasdaq Composite Index added 110.42 points, or 1%, finishing at 11,129.73, while booking its 33rd record close of the year. The , S&P 500 rose 9.14 points, or 0.3%, closing at 3,381.99 away from its record closing peak at 3,386.15 with Tech shares a huge contributor to the gauge.

Inflation in the U.K seems to have accelerated to the fastest in four months in July which comes as an unexpected jump that may likely persuade the BOE to put a brake on its stimulus pedal. Consumer prices climbed 1% in July from a year earlier which is almost double economists’ expectations. The reading was boosted by fuel, the absence of the usual summer clothing sales, and private health firms passing on the higher cost of virus-related protective equipment.

With reports signaling a surge in U.S gasoline stockpiles just before OPEC and its allies meet to assess its demand and supply agreement on Wednesday(today), oil has been seen to ease from its five-month high. Reports show inventories gained by about 5 million barrels last week, according to people familiar, offsetting a decline in crude stockpiles. Prices on the WTI crude decreased 0.7% to $42.61/bbl at the close of trading yesterday. It is also worth nothing that prices of physical oil barrels trading in the Asian spot market are weakening further this month as more OPEC+ supply hits a region where margins stay low and demand is still struggling to return to pre-virus levels.

In the Eurobonds SSA space, the NIGERIA SOVs traded on a simply cautious note, despite seeing some improved demand across the curve yields did compress by an average of c.5bps across the curve. Rest of the African curve traded in a similar manner as most of them simply showed a slight reaction to the decline in the oil prices.