Finance

Dollar up as Biden confirms re-election bid

Dollar up as Biden confirms re-election bid

U.S. President Joe Biden departs after delivering remarks on a a tentative deal was reached between U.S. railroads and unions to avert a rail shutdown, from the Rose Garden at the White House in Washington, U.S., September 15, 2022. REUTERS/Kevin Lamarque

The dollar was largely higher on Tuesday as Joe Biden confirmed his bid to win re-election as US president next year.

The announcement comes with the US economy still battered by high inflation and interest-rate rises, triggering concerns of a possible recession. Worries that the global economy could enter a downturn this year continued to weigh heavily on stock markets yesterday.

Traders have exited risk ahead of earnings results this week from US tech behemoths Amazon, Microsoft, Facebook owner Meta and Google parent Alphabet. Before that, General Motors raised key 2023 profit projections following a solid first quarter in which blow out results in North America compensated for declines in other regions. The big US automaker reported profits of $2.4 billion, down 19 per cent from the year-ago level, but translating to better-than-expected profits per share. GM shares jumped on the results.

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Investors were also waiting on important economic data from Australia and the eurozone, as well as a policy meeting of the Bank of Japan.

Stephen Innes of SPI Asset Management noted that despite “a reasonably constructive picture on the economy front”, it was tough to get “a clean read on anything happening this week”. “One of the most challenging things about navigating this bear market and the widely anticipated coming recession is that we’ve had to differentiate between real and nominal economic and market variables like nothing in recent decades,” he said.

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The US calendar also includes readings on first-quarter gross domestic product and an update on consumer confidence, as well as a potential vote in the long-running political stalemate over the US debt ceiling. Following recent shocks in the banking sector, UBS posted an underwhelming first quarter net profit of $1.0 billion but insisted it had seen strong client inflows as it prepared to integrate its stricken rival Credit Suisse.

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This development further translated to the parallel market as currency dealers around Lagos Island bought a dollar at N740 and sold at N736. However, this did not affect sentiments on the Nigerian stock market as its All Share Index (ASI) gained 0.95 per cent at the close of business yesterday due to price appreciation in the shares of Transcorp, Total, Airtel Africa.

Sunnews

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