It comes after US stocks fell when President Trump dashed hopes for a new economic relief package before the November election. Stocks had been climbing yesterday afternoon but immediately reversed after Mr. Trump tweeted that he had told his representatives to end negotiations with Democrats over a new aid package. The US President claimed that House Speaker Nancy Pelosi was “not negotiating in good faith.” The S&P 500 dropped 1.4 percent, to 3360.97 while the Dow Jones Industrial Average slid 1.3 percent. The Nasdaq Composite declined 1.6 percent to 11154.60.
“Clearly it deflates some of the optimism that was being priced into the market,” said Jon Hill, an interest-rate strategist at BMO Capital Markets.
However, he told The Wall Street Journal, investors seem to realize that the announcement “doesn’t mean we’re never getting another fiscal deal—it just means it won’t happen before the election and possibly not before inauguration.”
Many economists say a new aid package is important for the economy as the country continues to deal with the fallout from the coronavirus pandemic.
Republicans and Democrats had been moving closer after the House passed a $2.2 trillion bill last week, a reduction from the $3.5 trillion bill House Democrats passed in May.
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2pm update: Currency latest
The pound at 2pm was 1.2897 dollars compared to 1.2944 dollars at the previous close.
The euro at 2pm was 0.9132 pounds compared to 0.9099 pounds at the previous close.
1.00pm update: Greene King ‘preparing to close 25 pubs and cut 800 jobs’
Pub giant Greene King is considering cutting 800 jobs and closing dozens of establishments, Sky News has reported.
A consoltation process into the cuts, which would see 25 pubs close, began today.
Due to COVID restrictions, 79 pubs or restaurants will close – with around a third permamently.
Nick Mackenzie, Greene King’s chief executive, said recently: “The industry is still dealing with the crippling aftereffects of the nationwide lockdown and the cumulative effect of the new restrictions, combined with the singling out of pubs, mean the measures announced by the chancellor don’t go far enough, especially for drink-led city centre pubs.
“With Public Health England figures showing only 5% of all outbreaks are linked to hospitality, it feels like pubs are being unfairly targeted when there is little evidence that they enable the spread of Covid-19.”
12.00pm update: FTSE rises after rocky start
FTSE has soared 23 points in just 15 minutes, wiping out early losses.
Despite an up-and-down morning, the index has risen 6 points (0.11%) on the day.
11.25am update: FTSE regains losses
Despite a topsy-turvy morning, the FTSE has made up for earlier losses and now sits at around the level it started the day.
9.35am update: FTSE loses early gains
Despite a bright start, the FTSE is suffering this morning after a sudden drop.
The index rose sharply on open but has since lost those gains and even fallen below open.
It opened at 5,949 this morning, soared to 5,970 but now sits at 5,930.
8.10am update: FTSE soars on open
The FTSE has soared on open, rising 21 points in just 10 minutes.
The UK index closed at 5,949 yesterday but is now sitting at 5,970.
More to follow…