War on Big Tech, Jobless Claims, Dollar Weakness

War on Big Tech, Jobless Claims, Dollar Weakness

Dollar Hits Lowest since May 2018 

The Dollar Index dropped to its lowest since May 2018, falling below 90. Progress on a fiscal stimulus package and Fed’s policy for years to come drove investors into risk assets and alternative assets.

Bitcoin was again the biggest beneficiary of the move. It surged above $22,000, having broken through the $20k barrier only hours earlier.

Commodities were also big beneficiaries. Copper futures hit $3.60 a pound for the first time in nearly eight years.

Moreover, iron ore futures stayed just below the eight-year high they posted earlier in the week. Also hitting their highest were Cotton futures since April 2019.

In forex, the euro and sterling also hit their highest levels against the dollar since early 2018. They were helped by a steady drip of mini-agreements on mutual trading arrangements after December 31.

Antitrust Campaign vs Big Tech

The campaign to cut Big Tech down to size raised up a notch. Ten U.S. states announced a fresh lawsuit against Google, accusing it of running an illegal digital-advertising monopoly in cahoots with Facebook. For much of the last decade, the two have enjoyed an effective duopoly in online advertising. 

The suit was alleging that the two were colluding to rig advertising auctions. It was in a deal code-named after characters from Star Wars.

Jobless Claims Lead a Big Day for Data 

The market will be awaiting the release of data on jobless claims, housing starts and building permits for any further signs of economic weakness. This comes after a disappointing 1.1% drop in retail sales in November.

At 8:30 AM ET, all three sets of data are due for release. Regional business surveys from the Philadelphia and Kansas City Federal Reserve banks are due at 8:30 and 11 AM ET respectively.

Analysts expect initial jobless claims to have remained high at around 800,000. It surged to a three-month high of 853,000 last week.

Meanwhile, in stock market news, U.S. stock markets are set to open higher. Negotiators in Washington and Europe work toward an agreement on a U.S. fiscal stimulus package. Moreover, an EU-U.K. post-Brexit free trade agreement.

Dow Jones Futures rose 142 points, or 0.5% by 6:30 AM ET. S&P 500 Futures climbed 0.6% and NASDAQ Futures were up 0.5%.

Stocks to be in focus later will likely include Moderna (NASDAQ:MRNA). Its Covid-19 vaccine is set to receive a recommendation for emergency use authorization. That will be from a key panel of advisors to the Food and Drug Administration. 

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