News | Stocks mostly climb, dollar drops after Trump stimulus attack

Stock markets mostly rose and the dollar fell on Wednesday after President Donald Trump called a key US stimulus package “a disgrace” and told lawmakers to amend it.

Elsewhere the pound won back ground on post-Brexit trade deal hopes.

Oil prices edged higher after big losses this week as coronavirus cases surged across the planet and a new strain was reported in the UK.

That forced governments to impose tight restrictions and lockdowns to contain the disease over the festive period.

“Even though the Trump news is a bump in the road, there is some hope that a deal will eventually be put into place,” said CMC Markets analyst David Madden.

“Stock markets in Europe are broadly building on yesterday’s gains, even though the health crisis is still rumbling on and there has yet to be a deal agreed between the UK and the EU.”

Asian stock markets closed mainly higher Wednesday, while Wall Street was mixed Tuesday.

The worrying spike in infections has overshadowed the rollout of vaccines and news at the start of the week that Congress had finally hammered out an economic rescue package worth around $900 billion.

However Trump slammed the package as not doing enough for American families and told Congress to rethink it, raising the possibility of it being held up until after Christmas.

“It really is a disgrace,” he said in a video message posted on Twitter.

He demanded that individuals receive relief cheques totalling $2 000, up from $600 – with couples getting $4 000.

“I’m also asking Congress to immediately get rid of the wasteful and unnecessary items from this legislation, and just send me a suitable bill,” Trump added.

Looking ahead, Axi analyst Stephen Innes warned the first quarter of 2021 could be a struggle for markets.

“Even with the vaccine rollout getting underway, people have become polarised into one of two groups – those ready to travel now and those who are not prepared for six months or more.

“With the new variant of the virus unleashing its wrath on the UK, it is not a stretch to assume that the percentage of those ready to travel anytime soon will drop.”

Worries about the impact of new lockdowns on travel have hit oil prices badly, with both main contracts down sharply since hitting 10-month highs last week.

Investors are meanwhile keeping a wary eye on post-Brexit trade talks as British and European Union negotiators struggle to find common ground with just over a week to go until a deadline for a deal.

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