Dollar declines, gold hits record; stocks mixed: markets wrap

The dollar extended its recent slide and gold rose to a record high as investors mulled simmering Sino-American tensions, the upcoming Federal Reserve meeting and signs the virus spread in the US may be slowing. Global stocks were mixed.

The Bloomberg Dollar Spot Index fell as much as 0.8% to its lowest in about a year and a half. Shares fluctuated in Japan, Hong Kong and Australia, while US and European futures climbed after last week’s declines. A 10% surge in Taiwan Semiconductor Manufacturing Co. led shares in Taipei toward a record high. Silver rose as investor appetite for precious metals continued. Treasuries edged higher.

Investors this week will be looking to the Federal Reserve’s meeting for clues on what comes next for policy amid expectations for more accommodation ahead. That comes as wrangling continues in Washington over a stimulus bill. On the virus front, cases fell in California, Arizona, Florida and New York.

“The July FOMC meeting should kick off a period from August into mid-September in which markets should price in an increasingly dovish, forward-looking Fed policy via lower real rates,” Morgan Stanley strategists including Matthew Hornbach wrote in a report. “This should benefit breakeven inflation rates, support risk assets, and weigh on the US dollar.”

Elsewhere, oil edged lower after last week’s gain. Bitcoin climbed back above $10,000.

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