Stocks advance as new COVID mutation already forgotten by investors

22/12/2020

It looks like yesterday's events are already forgotten, with stock markets erasing most of yesterday's morning large decline during the US session. Today, the US and EU indices are advancing again. 

Countries across the world shut their borders to Britain on Monday due to fears about a new strain of coronavirus, said to be up to 70% more transmissible than the original, causing travel chaos. Many Britons are now stranded in the EU, and EU citizens cant return to their home countries ahead of the Christmas holidays.

Later in the day, market participants' focus will switch to US GDP data for the third quarter. However, there are no revisions expected in this release, and the annualized GDP should stay at 33.1%. 

Moreover, existing home sales will be released, along with the Richmond Fed manufacturing index.

In FX, the dollar is still trading flat - yesterday's bounce was quickly erased, and today's change is minimal in the major pairs. The EURUSD pair is seen near 1.2220, and the USDJPY pair was changing hands at around 103.40. The GBPUSD pair fell slightly to 1.3430 but remains some 200 pips above Monday's lows. 
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