Equities pull back as stimulus optimism fizzles out
Congress officials ended the trading week without a deal, pulling major indices lower. The S&P 500 and DJIA both fell 0.4%, while the Nasdaq fell less than 0.1%. Treasury yields and swap rates ended mixed – the 10-year UST yield closed 1 bp higher at 0.94%.
Fed Vice Chair Richard Clarida believes policy is “exactly where we want it”
Clarida added, “We think we are providing very ample support for the economy with the combination of our guidance and the purchases which are at a very very robust pace.” He does, however, believe further fiscal support is needed to support the economy .
FX Friday
The dollar index gained 0.21% today after hitting a 2.5 year lower earlier in the week. The move was driven by dwindling optimism around the US stimulus bill and ongoing Brexit trade negotiations.
Key events happening next week
Q3 GDP, core inflation, and consumer spending figures will all be published next week. The market will close early at 2 PM EST on Thursday and be closed on Friday in observance of Christmas Day.
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