GENEVA — US stocks posted modest gains and equities in Asia lacked direction, as better-than-expected US factory orders didn’t better the mood in the absence of an agreement for more US fiscal stimulus and rumors that the US and China will review their phase-one trade deal spurred worries that the deal could go down the plughole amid rising political tensions on Hong Kong’s new national security law. Meanwhile, a massive blast in Beirut briefly sent the price of WTI above $42 per barrel. There is little clarity on whether the explosion was an accident or an attack, but investors bought oil on suspicion that the blast could threaten stability in the region and weigh on supply. We believe that any menace to the supply side should have a marginal positive impact on oil prices in a market swamped with excess of oil. Therefore, the weakening demand prospects should continue driving the oil markets lower in the medium run. Capital poured into treasuries and gold Gold extended its record-breaking rally and surged to the $2,022 per oz on prolonged US fiscal stimulus talks, rising threats to the US-China trade deal and Beirut explosion. So far, we haven’t seen much profit-taking on the recent push, it will be interesting to watch how investors behave above the $2,000 mark. Either we will see a solid support building at this level, offering a new basis for a further advance as investors increase hedges against the mounting global inflation risks amid massive monetary and fiscal stimuli, or a sharp downside correction if speculative traders judge there is little potential left for more gains. Silver surged to $26 per oz. The US dollar weakened against the G10 majors The EURUSD made a U-turn following its early-week losses and recovered to 1.1820 on the back of a renewed setback in US dollar. Cable rebounded to 1.31 after having slipped below the 1.30 mark on Tuesday. Euro and sterling gains in US dollar terms should not be mistaken for a fundamentally backed appreciation; the major catalyzer of the recent gains is the weakness in the dollar, and any correction could trigger important headwinds in both pairs. Data-wise, the expansion in Chinese services wasn’t as stunning as the progress in manufacturing in July. Caixin’s PMI print of 54.5 remained significantly short of the market expectation of 58. Due today, the European PMI services data should post significant improvement in July activity as the deconfinement and summer holiday season should have boosted demand in services, especially in the southern European nations which have seen important tourist arrivals despite the ongoing pandemic. The data is also expected to confirm a solid expansion in UK services sector. Strong PMI surveys should help keeping the bears on the sidelines. FTSE (+0.13%) and DAX (+0.21%) futures point at modest gains at the open. On the corporate deck, Disney posted $4.7 billion loss in the second quarter as the Covid pandemic wreaked havoc on its overall business, but the Disney+ subscribers hit the 60-million mark, the lowest-end of its five-year projections, in only nine months of streaming. Disney’s share price rose as much as 5% in after-hours trading. Nasdaq extends its advance through uncharted territories on the back of a solid interest in technology stocks, as the COVID economy backs demand in online services. — The writer is senior analyst at Swissquote Bank