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Stocks slide as unemployment woes deepen, dollar holds steady

Martin Young

U.S. stock markets have been largely in decline this week as hopes of economic recovery dwindle. The greenback, however, has held on to its gains and remains resilient in these tough times.

Stock markets in the US fell on Thursday following gains made after Monday’s slump. The Dow Jones Industrial Average lost 135.39 points, or 0.5%, breaking a four-session winning streak. The S&P 500 dropped almost 11 points, or 0.3%, and the Nasdaq Composite fell 76.66 points, or 0.7%.

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The S&P 500 had declined further to 3202 at the time of writing and Friday was shaping up to end the week in the red for major markets. Prospects for economic recovery have been vague with renewed spikes in COVID-19 infections has prompting some U.S. states to go back into lockdown.

Unemployment concerns continue to grow as a further 1.3 million Americans filed for jobless claims last week, figures that were worse than expected. It has been the 17th consecutive week exceeding one million, and a total of 32 million Americans remained on unemployment benefits.

Twitter shares have been hit hard this week following a high profile hack that targeted the rich and powerful. Internal systems were used to access hundreds of high-follower accounts and post a scam demanding payment in Bitcoin, as reported by Finbold yesterday. Twitter stock slumped 6% following the hack but has since recovered to just over $35 at the time of writing.

In Asia, Chinese stocks suffered their biggest decline in more than five months, as fresh concerns about rising COVID-19 infections, and the global economy’s faltering recovery arose. Markets in Japan and Australia were also slightly lower, while stocks in Seoul, Hong Kong, and Taipei climbed marginally according to Bloomberg.

Forex Update

The greenback continues to show strength as investors remain cautious, opting for cash in times of difficulty. Many major currencies weakened slightly as fears of further virus outbreaks hindered confidence for forex traders.

One exception was the Euro, which remained supported by hopes that European officials will agree on fiscal stimulus measures at a meeting starting on Friday. The pair held steady at $1.1389.

Cable has weakened slightly to $1.256 following an intraweek high of $1.263 for Sterling. The greenback stood at 107.29 to the Yen in on Friday, following a 0.3% gain in the previous session.

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Further tensions between the Trump administration and China has kept the Yuan at exactly 7.000 to the dollar, which is where it has been for most of this week aside from declines on Wednesday and Thursday.

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