InvestMacro

By JustMarkets 

At Tuesday’s close, the Dow Jones Index (US30) decreased by 0.14%, while the S&P 500 Index (US500) was down 0.16%. The NASDAQ Technology Index (US100) closed negative 0.06%.

Spotify (SPOT) shares are up 2.11% after reporting stronger-than-expected subscriber growth and higher-than-expected gross profit. Tesla’s (TSLA) second-quarter net income fell 45% from a year ago as sales of the company’s electric vehicles declined globally despite price cuts and low-interest financing. Tesla Inc shares fell 3% after the report was released. Alphabet Inc. (GOOG) reported second-quarter financial results on Tuesday that mostly exceeded analysts’ expectations. The company reported adjusted earnings per share (EPS) of $1.89, slightly above the consensus estimate of $1.83. Revenue for the quarter totaled $84.74 billion, which was also above analysts’ average prognosis of $84.16 billion. Google shares rose 2.2 percent after-hours trading. Visa (V)’s third-quarter revenue growth fell short of Wall Street expectations as high borrowing costs curbed consumer spending, sending shares of the world’s largest payment processor down 2.1% in extended trading.

Recently, the market has viewed a Trump victory as favorable for the dollar. A Trump administration would likely pursue tax cuts and stimulative fiscal policy, which would be hawkish for Fed policy and thus favorable for the dollar. In contrast, a victory for Vice President Harris would favor the status quo and would not support the dollar.

Markets are awaiting Friday’s PCE deflator report to see when inflation might fall enough for the Fed to start cutting rates. The PCE deflator is the Fed’s preferred inflation gauge. The consensus on Friday is that the June PCE deflator will fall to 2.4% y/y from May’s 2.6%, and the June core PCE deflator will fall to 2.5% y/y from May’s 2.6%. A decline in the PCE index could support indices that have been corrected for the past few days.

Equity markets in Europe traded flat on Tuesday. German DAX (DE40) rose by 0.82%, French CAC 40 (FR40) closed down 0.31%, Spanish IBEX 35 (ES35) added 0.62%, British FTSE 100 (UK100) closed negative 0.38%. European equity markets opened lower on Wednesday as disappointing earnings reports weighed on investor sentiment. LVMH reported lower sales growth in the second quarter as Chinese consumers curbed spending on luxury goods, while Deutsche Bank recorded a quarterly loss after provisioning for ongoing litigation against its Postbank unit.

WTI crude prices rose to above $77 a barrel on Wednesday after falling for four consecutive sessions, helped by a larger-than-expected decline in US oil inventories. API data showed a 3.9 million barrel decline in inventories last week, marking the fourth straight week of decline and exceeding market estimates of a 2.5 million barrel drop. Renewed optimism over ceasefire talks between Israel and Hamas also put downward pressure on prices after Israeli Prime Minister Benjamin Netanyahu said a ceasefire agreement could take shape.

Asian markets were predominantly down yesterday. Japan’s Nikkei 225 (JP225) decreased by 0.01%, China’s FTSE China A50 (CHA50) was down 1.55%, Hong Kong’s Hang Seng (HK50) lost 0.94%, while Australia’s ASX 200 (AU200) was positive 0.50%.

Malaysia’s annual inflation rate unexpectedly came in at 2.0% for June 2024, below market expectations of 2.2%, and stable for the second consecutive month. The reading remained at its highest level since August 2023. Core consumer prices, excluding volatile fresh food and administrative expenses, rose 1.9% y/y in June, maintaining the same pace for a third month and remaining at the highest since December 2023.

Jibun Bank’s Japan Manufacturing PMI unexpectedly fell to 49.2 in July 2024 from 50.0 in the previous month, missing market estimates of 50.5 and indicating the first contraction in factory activity since April. The latest data also marked the fifth contraction in the manufacturing sector this year amid a fresh drop in output. The flash data showed that Japan’s services PMI from Jibun Bank jumped to 53.9 in July 2024 from 49.4 in the previous month. It was the sixth rise in the services sector this year and the sharpest since April, as new orders rose by the most in three months and employment growth accelerated.

S&P 500 (US500) 5,555.74 −8.67 (−0.16%)

Dow Jones (US30) 40,358.09 −57.35 (−0.14%)

DAX (DE40) 18,557.70 +150.63 (+0.82%)

FTSE 100 (UK100) 8,167.37 −31.41 (−0.38%)

USD Index 104.44 +0.12 (+0.12%)

• – Australia Manufacturing PMI (m/m) at 02:00 (GMT+3);
• – Australia Services PMI (m/m) at 02:00 (GMT+3);
• – Japan Manufacturing PMI (m/m) at 03:30 (GMT+3);
• – Japan Services PMI (m/m) at 03:30 (GMT+3);
• – Germany Manufacturing PMI (m/m) at 10:30 (GMT+3);
• – Germany Services PMI (m/m) at 10:30 (GMT+3);
• – Eurozone Manufacturing PMI (m/m) at 11:00 (GMT+3);
• – Eurozone Services PMI (m/m) at 11:00 (GMT+3);
• – UK Manufacturing PMI (m/m) at 11:30 (GMT+3);
• – UK Services PMI (m/m) at 11:30 (GMT+3);
• – US Manufacturing PMI (m/m) at 16:45 (GMT+3);
• – US Services PMI (m/m) at 16:45 (GMT+3);
• – Canada BoC Interest Rate Decision at 16:45 (GMT+3);
• – Canada BoC Monetary Policy Statement at 16:45 (GMT+3);
• – US New Home Sales (m/m) at 17:00 (GMT+3);
• – US Crude Oil Reserves (w/w) at 17:30 (GMT+3);
• – Canada BoC Press Conference at 17:30 (GMT+3);
• – FOMC Member Bowman Speaks at 23:05 (GMT+3).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By JustMarkets

At Monday’s close, the Dow Jones Industrial Average (US30) was up 0.32%, while the S&P 500 Index (US500) added 1.08%. The NASDAQ Technology Index (US100) closed positive 1.58%.

NVIDIA Corporation (NVDA) closed nearly 5% higher after Reuters reported that the chipmaker is developing a B20 version of its Blackwell GPU specifically for the Chinese market that will comply with US export control requirements. Ahead of Alphabet’s (GOOG) results release, Wedbush said it sees the tech giant’s sentiment as “positive ahead of second-quarter results” as advertising reviews and agency commentary point to the “continued strength of Google search.” Ahead of Tesla’s (TSLA) results release, CEO Elon Musk said humanoid robots will be used internally next year.

Equity markets in Europe were mostly up on Monday. Germany’s DAX (DE40) rose by 1.29%, France’s CAC 40 (FR40) closed positive 1.16%, Spain’s IBEX 35 (ES35) added 0.51%, and the UK’s FTSE 100 (UK100) closed positive 0.53%.

The Bank of England (BoE) urges market participants to prepare for a new cash management regime as excess liquidity is withdrawn from the financial system. Victoria Saporta, BoE executive director of markets, said the Central Bank wants to move from buying assets in exchange for cash reserves to a system of lending cash against those assets. The market has switched to repos as the BoE shrinks its balance sheet by selling bonds and not reinvesting in its maturing bond portfolio. However, the Central Bank now wants banks to use longer-term operations rather than short-term repo (STR) more often.

Morgan Stanley said the oil market deficit is likely to persist through most of the third quarter. However, by the fourth quarter, the market is expected to stabilize. This change is due to the decline in demand that typically occurs after summer and the projected increase in oil production by both OPEC and non-OPEC countries. That said, Morgan Stanley predicts that supply is likely to outstrip demand next year. The investment bank expects the oil price to fall to $75–79 by 2025.

WTI crude oil prices settled at $78.5 a barrel on Tuesday after falling for three consecutive sessions as investors’ attention shifted to US oil inventory data. On Monday, the People’s Bank of China unexpectedly lowered its interest rate to support economic growth, easing fears of a weakening Chinese economy and easing concerns about demand from the main oil consumer.

Asian markets were predominantly down yesterday. Japan’s Nikkei 225 (JP225) was down 1.16%, China’s FTSE China A50 (CHA50) lost 1.08%, Hong Kong’s Hang Seng (HK50) added 1.25%, and Australia’s ASX 200 (AU200) was negative 0.50%.

Hang Seng (HK50) shares fell by 0.4% in Tuesday morning session, bouncing back from an active session the previous day after fresh data showed Hong Kong’s annual inflation rate rose to a 3-month high of 1.5% in June, rising for a second month on the back of lower electricity subsidies. Meanwhile, business sentiment in the city turned negative in Q3 for the first time in 2 years due to concerns over a new security law.

Singapore’s annual inflation rate fell to 2.4% in June 2024 from 3.1% in May, below market estimates of 2.7% and pointing to the lowest rate since August 2021. Annualized core inflation fell to 2.9% from 3.1% in the previous 3 months, falling short of the 3.0% prognosis and indicating the lowest level since March 2022. On a month-on-month basis, CPI fell by 0.2%, the first decline in three months.

The Australian dollar held below $0.665, near its lowest level in three weeks, as China’s surprise move to cut key interest rates pressured the currency. The Australian dollar is widely seen as a liquid proxy for the Chinese yuan, as Australia’s economy relies heavily on exports to China. The local currency has also been pressured recently by weakening commodity prices as Australia is a net exporter of energy and metals.

In Japan, Toshimitsu Motegi, a senior ruling party official, called on the Bank of Japan to more clearly outline its plan to normalize monetary policy through successive rate hikes, adding that excessive yen depreciation was hurting the economy.

S&P 500 (US500) 5,564.41 +59.41 (+1.08%)

Dow Jones (US30) 40,415.44 +127.91 (+0.32%)

DAX (DE40) 18,407.07 +235.14 (+1.29%)

FTSE 100 (UK100) 8,198.78 +43.06 (+0.53%)

USD Index 104.30 -0.10 (-0.09%)

• – Singapore Consumer Price Index (q/q) at 08:00 (GMT+3);
• – US Existing Home Sales (m/m) at 17:00 (GMT+3).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By JustMarkets

On Friday, the Dow Jones (US30) Index fell by 0.93% (for the week +0.37%), while the S&P 500 (US500) Index lost 0.71% (for the week -2.36%). The NASDAQ Technology Index (US100) closed negative 0.81% (for the week -4.11%). Investors continued to take profits after the recent record highs of the major indices. In addition, after an already turbulent week, a global IT system failure affecting services from airlines to banks added to the worries. Presumably, the outage was caused by an update from CrowdStrike that caused problems with Microsoft’s Windows.

US President Joe Biden has withdrawn from the 2024 presidential election. This came after his supporters turned their backs on him for weeks amid his poor debate performance against former president and Republican nominee Donald Trump. Biden has endorsed Vice President Kamala Harris, who has said she is running for president.

Bitcoin rose to around $68,000 on Monday, hitting its highest level since mid-June. The US bitcoin exchange-traded funds received a total of more than $17 billion in inflows in July, setting a new record. BlackRock’s IBIT and Fidelity’s FBTC were the main contributors, with net inflows of about $19 billion and $10 billion, respectively. Betting on Trump’s second presidency also continued to support digital assets in anticipation of a more favorable regulatory environment for them. Trump is scheduled to speak at an industry conference in Nashville, Tennessee, later this month, and some analysts speculate that he will announce plans to include Bitcoin in the US strategic reserves.

Equity markets in Europe were mostly down on Friday. Germany’s DAX (DE40) fell by 1.00% (-3.01% for the week), France’s CAC 40 (FR40) lost 0.69% (-1.92% for the week), Spain’s IBEX 35 (ES35) fell by 0.54% (-1.23% for the week), and the UK’s FTSE 100 (UK100) closed negative 0.60% (-1.18% for the week).

While economic growth in the Eurozone remains sluggish, a dominant service sector driven by tourism is keeping price pressures at uncomfortably high levels. This poses challenges for the ECB, so Wednesday’s PMI data will be closely watched after the Central Bank kept interest rates at 3.75% last Thursday and gave no further guidance, saying it “depends on the data.”

On Friday, oil prices settled at their lowest level since mid-June as investors anticipated a possible ceasefire in Gaza, while a strong dollar also had an impact. The war in Gaza has prompted investors to put a risk premium on oil trading as tensions threaten global supplies. If a truce is reached, Iran-backed Houthi rebels may ease their attacks on commercial ships in the Red Sea as the group has declared support for Hamas.

Asian markets traded without any dynamics last week. Japan’s Nikkei 225 (JP225) fell by 3.85%, China’s FTSE China A50 (CHA50) gained 1.26%, Hong Kong’s Hang Seng (HK50) lost 4.31%, and Australia’s ASX 200 (AU200) was positive 0.15%.

The offshore yuan hit its lowest level in more than a week as traders reacted to the latest decision by the People’s Bank of China (PBoC). In a surprise move, key lending rates were cut to new record lows during the July fixing to support the fragile economic recovery. The 1-year prime rate (LPR), the benchmark for most corporate and household loans, was cut 10 basis points to 3.35%, while the 5-year rate, the benchmark for real estate mortgages, was cut 10 basis points to 3.85%. In addition, the Central Bank initiated a ¥58.2 billion reverse repurchase operation and cut the seven-day reverse repo rate by 10 basis points to 1.7% from 1.8%. The decision came shortly after last week’s third plenum and followed a series of economic data indicating that the economic recovery may be losing momentum.

The Australian dollar fell to $0.668, hitting its weakest level in three weeks, as a sharp decline in energy and metals prices pressured the currency. Australia’s economy relies heavily on commodity exports, making the Australian dollar sensitive to changes in commodity prices.

S&P 500 (US500) 5,505.00 −39.59 (−0.71%)

Dow Jones (US30) 40,287.53 −377.49 (−0.93%)

DAX (DE40) 18,171.93 −182.83 (−1.00%)

FTSE 100 (UK100) 8,155.72 −49.17 (−0.60%)

USD Index 104.37 +0.19 (+0.18%)

• – New Zealand Trade Balance (q/q) at 01:45 (GMT+3);
• – China PBoC Loan Prime Rate at 04:15 (GMT+3).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By JustMarkets

The Dow Jones Index (US30) fell by 1.29% yesterday, while the S&P 500 Index (US500) went down 0.78%. The NASDAQ Technology Index (US100) closed negative 0.70%. Stocks initially opened higher on Thursday, with the Dow Jones Industrials Index (US30) setting a new record high amid a rebound in chip maker stocks after Taiwan Semiconductor Manufacturing Co, a supplier of chips to Apple (AAPL) and Nvidia (NVDA), reported better-than-expected second-quarter results and raised revenue growth estimates for 2024. But by the end of the trading day, stock indices gave up their early gains and retreated, with the S&P 500 (US500) posting a two-week low and the Nasdaq 100 (US100) falling to a three-week low. Falling shares of technology companies and large-cap banks weighed on the overall market.

Dovish comments from Chicago Fed President Goolsbee supported stocks yesterday when he said the Fed may have to cut interest rates soon to avoid a sharp deterioration in a labor market that has been cooling in recent months. Weekly US initial jobless claims rose by 20,000 to 243,000, indicating a weaker labor market than expectations of 229,000.

Equity markets in Europe traded mixed on Thursday. Germany’s DAX (DE40) decreased by 0.45%, France’s CAC 40 (FR40) closed up 0.21%, Spain’s IBEX 35 (ES35) was up 0.38%, and the UK’s FTSE 100 (UK100) closed positive 0.21%.

German producer prices fell by 1.6% y/y in June 2024, softer than the 2.2% decline in the previous month and in line with market estimates. This is the 12th consecutive month of producer price deflation, but the softest on record, amid falling energy prices (-5.9%), particularly natural gas (-14.8%) and electricity (-11.0%). UK retail sales in June 2024 declined 1.2% on the previous month, following a 2.9% rise in May, worse than market prognoses expecting a 0.4% drop.

On Friday, WTI crude oil prices fell to $82 per barrel, extending losses from the previous session, driven by a broad sell-off in risk assets and a stronger US dollar. On Thursday, US stocks and commodities declined and the dollar recovered as investors took a more cautious stance in assessing the global economic outlook.

The US natural gas prices (XNGUSD) rose more than 3.5% to above $2.1 per mmbbl, rebounding from a 10-week low after the EIA reported a smaller-than-expected injection into storage. The US utilities added 10 billion cubic feet (Bcf) of gas to storage last week, below the expected 28 Bcf increase, bringing total inventories to 3,209 Bcf, 16.9% above the 5-year average.

Asian markets traded mixed yesterday. Japan’s Nikkei 225 (JP225) was down 2.36%, China’s FTSE China A50 (CHA50) was up 0.46%, Hong Kong’s Hang Seng (HK50) was up 0.22% and Australia’s ASX 200 (AU200) was negative 0.27%.

A growing number of economists are pushing back the timing of interest rate cuts to the RBNZ’s August meeting. Earlier in the week, data emerged that the country’s annual inflation rate fell to a three-year low of 3.3% in the second quarter, down from 4% in the previous period. This spurred expectations of three rate cuts by the Reserve Bank of New Zealand, with markets estimating an overall rate easing of 70 basis points before the end of the year.

The increase in Australian jobs in June points to a tight labor market, adding to concerns about a possible interest rate hike by the Reserve Bank of Australia (RBA). However, the unemployment rate rose to 4.1% from 4%. The probability of a rate hike by the Central Bank in August now stands at 20%, up from 12% earlier this week. The RBA is also expected to ease policy much later than other major central banks. Against the kiwi, the Australian dollar is set to rise for a fifth consecutive week amid growing divergence in the monetary policy outlook between New Zealand and Australia.

According to preliminary data, Malaysia’s economy grew to an annualized rate of 5.8% in Q2 2024, significantly higher than the growth of 4.2% in Q1. This was the highest GDP growth since Q4 2022, helped by expansion in all sectors. The services sector accelerated (5.6% vs. 4.7% in Q1), aided by wholesale and retail trade.

S&P 500 (US500) 5,544.59 −43.68 (−0.78%)

Dow Jones (US30) 40,665.02 −533.06 (−1.29%)

DAX (DE40) 18,354.76 −82.54 (−0.45%)

FTSE 100 (UK100) 8,204.89 +17.43 (+0.21%)

USD Index 104.19 +0.45 (+0.43%)

• – Japan National Core Consumer Price Index at 02:30 (GMT+3);
• – UK Retail Sales (m/m) at 09:00 (GMT+3);
• – German Producer Price Index (m/m) at 09:00 (GMT+3);
• – Canada Retail Sales  (m/m) at 15:30 (GMT+3);
• – US FOMC Willaams Speaks at 17:40 (GMT+3);
• – US FOMC Bostic Speaks at 19:45 (GMT+3).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By JustMarkets

Stock indices traded mixed on Wednesday, with the Dow Jones Industrials (US30) setting a new record high and the Nasdaq 100 (US100) falling to a two-week low. The Dow Jones Industrials (US30) Index gained 0.59%, while the S&P 500 (US500) Index fell by 1.39%. The NASDAQ Technology Index (US100) closed negative 2.77%. Positive corporate news boosted the broad market on Tuesday. Stock declines in chip companies and technology mega-companies negatively impacted the broader market. Nvidia stock fell by 7%, Qualcomm and AMD lost 8%, ARM fell nearly 10%, and ASML’s ADR decreased by 11%. In addition, larger technology stocks, Apple and Microsoft, lost more than 2% each. Shares of chip companies declined on concerns that the US may adopt tougher restrictions on Chinese trade and semiconductor technology. Bloomberg reported Wednesday that the Biden administration has told allies it is considering the toughest trade restrictions against chipmakers if they continue to give China access to advanced semiconductor technology.

Equity markets in Europe traded mixed on Wednesday. Germany’s DAX (DE40) was down 0.44%, France’s CAC 40 (FR40) closed down 0.12%, Spain’s IBEX 35 (ES35) was up 0.13%, and the UK’s FTSE 100 (UK100) closed positive 0.28%. European stocks have been suffering heavy losses for the past 2 sessions, as chip stocks have been under pressure due to reports that the US is considering tightening restrictions on chip exports to China. Donald Trump’s comments about Taiwan having to pay the US for defense also added to geopolitical concerns in the sector.

The UK labor market report was mixed. In the three months to May 2024, the number of people employed in the United Kingdom rose by 19,000 after falling by 139,000 in the previous period and exceeded market estimates. This marked the first rise in job creation in the three months to December 2023. Average weekly earnings, including bonuses in the UK for the three months to May 2024, rose 5.7% year-on-year to £689 a week, down 5.9% in each of the previous two periods and in line with estimates of 5.7%.

WTI crude oil prices climbed above $83 a barrel on Thursday, extending gains from the previous session, thanks to a larger-than-expected drawdown in US crude inventories. According to the EIA, the US crude oil inventories fell by 4.87 million barrels in the week ended July 12, marking the third straight week of decline and exceeding the market estimates for a 0.8 million barrel decline. It is the longest stretch of inventory declines since September.

Asian markets traded mixed yesterday. Japan’s Nikkei 225 (JP225) was down 0.43%, China’s FTSE China A50 (CHA50) added 0.46%, Hong Kong’s Hang Seng (HK50) was up 0.06% and Australia’s ASX 200 (AU200) was positive 0.73%.

Australia added more jobs than expected in June amid strong job openings and a high participation rate, although the unemployment rate rose to 4.1% from 4%. The Reserve Bank of Australia is expected to keep interest rates unchanged in August. Still, some traders continue to bet on another rate hike amid persistent inflationary pressures and a tight labor market. The RBA is also expected to ease policy much later than other major central banks.

S&P 500 (US500) 5,588.27 −78.93 (−1.39%)

Dow Jones (US30) 41,198.08 +243.60 (+0.59%)

DAX (DE40) 18,437.30 −80.73 (−0.44%)

FTSE 100 (UK100) 8,187.46 +22.56 (+0.28%)

USD Index 103.74 −0.53 (−0.51%)

• – Japan Trade Balance (m/m) at 02:50 (GMT+3);
• – Australia Unemployment Rate (m/m) at 04:30 (GMT+3);
• – UK Average Earnings Index (m/m) at 09:00 (GMT+3);
• – UK Claimant Count Change (m/m) at 09:00 (GMT+3);
• – UK Unemployment Rate (m/m) at 09:00 (GMT+3);
• – Eurozone ECB Interest Rate Decision at 15:15 (GMT+3);
• – Eurozone Monetary Policy Statement at 15:15 (GMT+3);
• – US Initial Jobless Claims (w/w) at 15:30 (GMT+3);
• – Eurozone ECB Press Conference at 15:45 (GMT+3);
• – Eurozone President Lagarde Speaks (m/m) at 17:15 (GMT+3);
• – US Natural Gas Storage (w/w) at 17:30 (GMT+3).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By JustMarkets

Stock indices closed higher on Tuesday, with the S&P 500 and Dow Jones Industrials setting new all-time highs. The Dow Jones Index (US30) gained 1.85%, while the S&P 500 Index (US500) rose by 0.64%. The NASDAQ Technology Index (US100) closed positively, 0.20%. Positive corporate news boosted the broad market on Tuesday.

Bank of America (BAC) closed higher by more than 5% after reporting a second-quarter net interest income of $13.86 billion, better than the consensus of $13.81 billion, and estimating fourth-quarter net interest income of $14.50 billion, above consensus of $14.33 billion. Morgan Stanley (MS) closed higher by more than 1% after reporting second-quarter net sales of $15.0 billion, above the consensus expectation of $14.27 billion.

US retail sales for June were unchanged m/m, stronger than expectations for a 0.3% m/m decline. Additionally, June retail sales excluding autos rose 0.4% m/m, stronger than expectations of 0.1% m/m.

Bitcoin (BTC/USD) climbed above the $65,000 mark, hitting its highest level in nearly a month amid renewed bullish sentiment toward digital assets. Data showed that daily net inflows into 11 US spot bitcoin ETFs totaled $422.67 million on July 16, the highest since June 5 and extending the positive momentum to eight consecutive days.

Equity markets in Europe were mostly down on Tuesday. Germany’s DAX (DE40) fell by 0.39%, France’s CAC 40 (FR40) closed down 0.69%, Spain’s IBEX 35 (ES35) lost 0.47%, and the UK’s FTSE 100 (UK100) closed negative 0.22%.

The UK’s annualized inflation rate for June 2024 was 2%, the same as in May and at the 2021 low, although market estimates pointed to 1.9%. The annual rate of core inflation in the UK in June 2024 was 3.5%, holding steady for the second consecutive month and at its lowest level since October 2021. The data matched market estimates, with the annualized CPI services rate at 5.7% for the second consecutive month.

WTI crude oil prices hovered near $80.8 a barrel on Wednesday, trying to break a four-day slide as lingering demand concerns in top consumer China were offset by a decline in US inventories. China’s second-quarter GDP growth and June retail sales came in below expectations, dragged down by the ongoing real estate market crisis and job insecurity. Meanwhile, the IMF estimates moderate global economic growth over the next two years, including a slowdown in the US, stabilization in Europe, and increased consumption and exports in China.

Asian markets traded mixed yesterday. Japan’s Nikkei 225 (JP225) rose by 20%, China’s FTSE China A50 (CHA50) gained 0.10%, Hong Kong’s Hang Seng (HK50) fell by 1.60% and Australia’s ASX 200 (AU200) was negative 0.23%. On Tuesday, China’s Central Bank injected the largest amount of cash into the Chinese banking system since January to offset the impact of the tax season and maintain ample liquidity. That will support Chinese indices.

The offshore yuan settled at 7.285 per dollar, holding near a one-week low as investors digested Chinese President Xi Jinping’s recent speech at the Third Plenum. Xi urged the Communist Party to maintain “unwavering faith and commitment” to its strategic program amid a challenging domestic and international environment characterized by sluggish economic growth and geopolitical tensions. He also emphasized that Beijing intends to prioritize technology, advanced manufacturing, and other critical sectors necessary for China’s long-term sustainability.

The New Zealand dollar rose to $0.606 on the back of inflation data. New Zealand’s annual inflation rate slowed to 3.3% in the second quarter, the lowest in three years, from 4% in the previous period. However, the latest figure remains outside the Reserve Bank’s target range of 1–3%. The Central Bank expects inflation to return to the target range later this year and will only consider cutting rates once it is satisfied that inflation will remain within that range.

S&P 500 (US500) 5,667.20 +35.98 (+0.64%)

Dow Jones (US30) 40,954.48 +742.76 (+1.85%)

DAX (DE40) 18,518.03 −72.86 (−0.39%)

FTSE 100 (UK100) 8,164.90 −18.06 (−0.22%)

USD Index 104.24 +0.05 (+0.05%)

• – New Zealand Consumer Price Index (m/m) at 01:45 (GMT+3).
• – UK Consumer Price Index (m/m) at 09:00 (GMT+3);
• – UK Producer Price Index (m/m) at 09:00 (GMT+3);
• – Eurozone Consumer Price Index (m/m) at 12:00 (GMT+3);
• – US Industrial Production (m/m) at 16:15 (GMT+3);
• – US Crude Oil Reserves (w/w) at 17:30 (GMT+3).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By JustMarkets

At Monday’s close, the Dow Jones (US30) Index was up 0.53%, while the S&P 500 (US500) Index was up 0.28%. The NASDAQ Technology Index (US100) closed positive 0.40% yesterday. The Russell 2000 Index also gained 1.8% as investors continued to refocus on small-company stocks. The energy, financials, and industrial sectors outperformed the market, while utilities, consumer staples, and healthcare stocks were the biggest fallers. Federal Reserve Chairman Jerome Powell said yesterday that the central bank won’t wait until inflation reaches 2 percent before cutting interest rates because it operates with “long and variable lags.” That raised the likelihood of the first-rate cut in September, which is a positive for indices. Investors are now awaiting Tuesday’s US retail sales data and Fed officials’ comments for more clues on the future course of monetary policy. Markets have already all but priced in September’s rate cut, with two more cuts expected before the end of the year.

The Bank of Canada’s Business Outlook Survey emphasized continued pessimism among Canadian companies, attributing it to weak sales expectations and high equipment costs holding back investment. In addition, Canada’s unemployment rate rose in June to its highest level since January 2022, accompanied by an unexpected 1.4k jobs decline versus an expected 22.5k increase, adding to the Bank of Canada’s concerns about the impact of higher interest rates on the labor market.

Bitcoin (BTC/USD) surged to $65,000 on Tuesday, hitting its highest level in nearly a month, as US presidential candidate Donald Trump picked Sen. J.D. Vance as his running mate. The Ohio Republican said he owns more than $100,000 worth of bitcoin and has been critical of regulatory actions taken by the US Securities and Exchange Commission (ІSEC) against the crypto industry. Bitcoin has risen more than 10% since Friday, helped largely by the prospect of a second Trump presidency.

Equity markets in Europe were mostly down on Monday. Germany’s DAX (DE40) fell by 0.84%, France’s CAC 40 (FR40) closed down 1.19%, Spain’s IBEX 35 (ES35) lost 0.96%, and the UK’s FTSE 100 (UK100) closed negative 0.85%. Disappointing economic data from China, negative corporate news, and quarterly results dampened investor sentiment.

WTI crude oil prices fell to $81.5 a barrel on Tuesday, declining for the third consecutive session. Demand uncertainty in top consumer China and a rising dollar pressured oil prices. Data released Monday showed China’s oil imports fell month-on-month and year-on-year to 46.45 million tons in June amid weak domestic demand.

Asian markets were predominantly up yesterday. Japan’s Nikkei 225 (JP225) was not trading yesterday, China’s FTSE China A50 (CHA50) added 0.36%, Hong Kong’s Hang Seng (HK50) was down 1.52% and Australia’s ASX 200 (AU200) was positive 0.73%.

Hong Kong stocks fell by 1.3% in Tuesday morning trading, declining for a second day and moving away from their highest level in 3 weeks amid a retreat in all sectors. Disappointingly, Q2 Chinese GDP data continued to weigh on sentiment. Meanwhile, Goldman Sachs cut China’s 2024 GDP forecast to 4.9% from 5%, and JPMorgan cut its forecast to 4.7% from 5.2%. Investors’ attention turns to the Third Plenum, a high-level leadership conference scheduled for July 15-18, where they will await policy decisions. However, the focus is expected to be long-term economic and social issues.

The Australian dollar will remain positive against other currencies as the Reserve Bank of Australia (RBA) is expected to ease policy much later than other major central banks. Due to ongoing domestic inflationary pressures, markets are also looking at the possibility of another rate hike by the RBA this year. Investors are now awaiting Australian employment data later this week to gauge the state of the labor market.

The New Zealand dollar fell to $0.605, at its lowest level in two weeks, as investors await second-quarter inflation data that could influence the Reserve Bank of New Zealand’s (RBNZ) policy trajectory. Economists expect New Zealand’s consumer inflation to slow to 3.5 percent in the second quarter, the lowest rate on record.

S&P 500 (US500) 5,631.22 +15.87 (+0.28%)

Dow Jones (US30) 40,211.72 +210.82 (+0.53%)

DAX (DE40) 18,590.89 −157.29 (−0.84%)

FTSE 100 (UK100) 8,182.96 −69.95 (−0.85%)

USD Index 104.26 +0.17 (+0.16%)

• – German ZEW Economic Sentiment (m/m) at 12:00 (GMT+3);
• – Eurozone ZEW Economic Sentiment (m/m) at 12:00 (GMT+3);
• – Eurozone Trade Balance (m/m) at 12:00 (GMT+3);
• – US Retail Sales (m/m) at 15:30 (GMT+3);
• – Canada Consumer Price Index (m/m) at 15:30 (GMT+3).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By JustMarkets

At Thursday’s close, the Dow Jones Index (US30) was up 0.08%, while the S&P 500 Index (US500) decreased by 0.88%. The NASDAQ Technology Index (US100) closed negative 1.95%. Stocks found early support on Thursday on the Fed’s favorable June US CPI report, which lowered bond yields and reinforced speculation that the Fed could cut interest rates this year. However, a rotation out of technology stocks on Thursday pulled the S&P 500 away from a new record high and pressured the broader market. Shares of Tesla (TSLA) fell more than 8%, putting pressure on tech stocks after it postponed its robot cab unveiling to October.

June US CPI declined to 3.0% y/y from 3.3% y/y in May, better than expectations of 3.1% y/y. June CPI, excluding food and energy, declined to a 3-year low of 3.3% y/y from 3.4% y/y in May, which was better than expectations of no change at 3.4% y/y. US weekly initial jobless claims fell by 17,000 to a 6-week low of 222,000, indicating a stronger labor market than expectations of 235,000. The trade surplus with the US increased to $31.78 billion in June from $30.81 billion in the previous month. In the first half of 2024, the surplus totaled $435 billion, with exports rising 3.6% to $1.71 trillion and imports increasing 2.0% to $1.27 trillion. Markets rate the odds of a 25 bps rate cut at 9% for the next FOMC meeting on July 30–31 and 93% for the September 17–18 meeting.

The Canadian dollar strengthened to 1.36 per US dollar in July, hitting an eight-week high. This was due to a weaker dollar after a decline in US inflation boosted bets that the Fed would cut rates in September. These developments balanced the outlook for the Fed and the Bank of Canada. Canada’s macroeconomic backdrop also supports bets that the Bank of Canada will continue to lower borrowing costs.

Equity markets in Europe were mostly up on Thursday. Germany’s DAX (DE40) rose by 0.69%, France’s CAC 40 (FR40) closed higher by 0.71%, Spain’s IBEX 35 (ES35) climbed 0.89%, and the UK’s FTSE 100 (UK100) closed positive 0.36%.

WTI crude oil prices rose to 82.9 dollars per barrel on Friday, rising for the third consecutive session amid positive market sentiment following the release of lower-than-expected inflation data in the United States, the world’s largest oil consumer. The June slowdown in US consumer price growth boosted expectations of a Federal Reserve rate cut, with traders now estimating the probability of a rate cut in September at 93%, up from 73% on Wednesday. In addition, signs of strong summer demand are supporting oil prices.

Asian markets were predominantly up yesterday. Japan’s Nikkei 225 (JP225) gained 0.94%, China’s FTSE China A50 (CHA50) added 0.55%, Hong Kong’s Hang Seng (HK50) jumped 2.06%, and Australia’s ASX 200 (AU200) was positive 0.93%.

Japan’s 10-year government bond yield fell to around 1.05%, hitting a two-week low, as investors reassessed the Bank of Japan’s monetary policy outlook in light of the yen’s surge. On July 11, the yen rose 2.6% to 157.42 per dollar, which traders attributed to likely government intervention. The Bank of Japan is under pressure to raise interest rates again in July to defend its currency and narrow the gap between domestic and foreign yields. The Central Bank is also expected to announce its plans to reduce bond purchases this month after it met with market participants this week to determine the actual pace of bond buying cuts.

China’s trade surplus in June 2024 rose to 99.05 billion US dollars from 69.80 billion US dollars in the same period a year earlier, beating market expectations of 85 billion US dollars. It was the biggest trade surplus since July 2022, as exports rose and imports fell. Exports rose by 8.6% from a year earlier, the fastest pace in 15 months and beating estimates for 8% growth, while imports unexpectedly fell 2.3%, missing estimates for 2.8% growth and after rising 1.8% in May.

Singapore’s economy grew at a 2.9% annualized rate in the second quarter of 2024, beating market estimates that expected 2.7% growth. The preliminary estimate also followed an upwardly revised 3% growth in the previous quarter, the fastest growth rate in a year and a half.

S&P 500 (US500) 5,584.54 −49.37 (−0.88%)

Dow Jones (US30) 39,753.75 +32.39 (+0.082%)

DAX (DE40) 18,534.56 +127.34 (+0.69%)

FTSE 100 (UK100) 8,223.34 +29.83 (+0.36%)

USD Index 105.01 −0.12 (−0.11%)

• – China Trade Balance (m/m) at 06:00 (GMT+3);
• – US Producer Price Index (m/m) at 15:30 (GMT+3);
• – US Michigan Consumer Sentiment (m/m) at 17:00 (GMT+3).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.