Daily Market View
Monday, July 23, 2018
| U.S Stock Market
U.S stock index futures fell on Friday after President Donald Trump toughened his stance against China and said he was ready to impose levies on $500 billion worth of goods from the Asian nation. His comments on tariffs, which followed the United States and China imposing tariffs on $34 billion worth of each other’s goods this month, worried investors already grappling with the impact of a strengthening dollar on corporate results. German Chancellor Angela Merkel also said on Friday that U.S. tariffs on imported cars would be against WTO rules and that the European Union was looking at countermeasures. The latest round of U.S. tariffs on $200 billion worth of Chinese goods, held up for now by a formal public comment period, could impact Apple Inc’s watches, several Fitbit activity trackers and connected speakers from Sonos. Providing support was Microsoft, whose shares jumped 3.7 percent in premarket trading after its profit and revenue beat estimates on strong performance of its Azure cloud computing services business.
|Major Economic Releases for Today|
||BOJ Outright Bond Purchase 3~5 Years||01:10|
|Switzerland Money Supply M3 (YoY)||07:00||2.9%|
|Switzerland Domestic Sight Deposits||08:00|
|Canada Wholesale Trade Sales (MoM)||12:30||0.1%|
|U.S Chicago Fed Nat Activity Index||12:30||-0.15|
|Mexico Economic Activity IGAE (YoY)||13:00||4.53%|
|Euro-Zone Consumer Confidence||14:00||-0.5|
|U.S Existing Home Sales (MoM)||14:00||-0.2%||-0.4%|
||U.S. to sell 6-Month Bills||15:30|
|Dow Jones Industrial Average
The Dow Jones Industrial Average declined 0.03% on Friday. The best performers of the session on the Dow Jones Industrial Average were Microsoft Corporation, which rose 1.79% or 1.87 points to trade at 106.27 at the close. Meanwhile, JPMorgan Chase & Co added 1.26% or 1.39 points to end at 111.28 and Goldman Sachs Group Inc. was up 0.90% or 2.06 points to 231.69 in late trade. The worst performers of the session were International Business Machines, which fell 1.94% or 2.89 points to trade at 146.35 at the close. Caterpillar Inc. declined 1.86% or 2.60 points to end at 136.82 and Cisco Systems Inc. was down 0.92% or 0.39 points to 42.01.
The tech heavy NASDAQ index lost 0.07%. The top performers on the NASDAQ Composite were Rewalk Robotics Ltd which rose 73.64% to 1.25, Aralez Pharmaceuticals Inc. which was up 25.46% to settle at 0.31 and SAExploration Holdings Inc. which gained 19.41% to close at 2.030. The worst performers were Zynerba Pharmaceuticals Inc. which was down 24.09% to 7.91 in late trade, FTD Companies Inc. which lost 19.47% to settle at 3.64 and Diversified Restaurant Holdings Inc. which was down 16.53% to 1.010 at the close.
Oil prices rose on Friday as a weakening dollar and lower expected August crude exports from Saudi Arabia supported the market, offsetting concerns about U.S.-China trade tensions and supply increases. U.S. crude strengthened late in the session as the U.S. dollar index slipped to a four-day low, on reports that U.S. President Donald Trump worries that the Federal Reserve will raise rates twice this year. The dollar was a one-way ticket for the last couple of weeks and basically reversed directions, giving us some strong support. U.S. drillers this week cut five oil rigs, the most since March, according to a Baker Hughes report, with the rate of growth slowing over the past month with recent declines in crude prices. Prices also received a boost after OPEC’s largest oil producer, Saudi Arabia, said it would temper its exports next month.
|Precious and Base Metals
Gold prices edged up in volatile trade on Friday, after hitting a one-year low in the previous session, as the U.S. dollar eased from its highest in a year. Spot gold was trading at $1,224.55 an ounce. In the previous session, it fell to its weakest since July last year at $1,211.08 an ounce. U.S. gold futures were little changed at $1,224.40 an ounce. Geopolitical tensions such as trade war are supporting gold to some extent but investors are still not ready to hedge their bets fully, they think the current situation is only a hiccup and things will smooth out after that. The dollar index, which measures the greenback against a basket of six major currencies, was down 0.03 percent at 95.123, after U.S. President Donald Trump expressed concern about the currency’s strength and the Federal Reserve’s interest rate increases. Trump on Thursday criticized Fed’s policy even though most economists believe the highest inflation in seven years and lowest unemployment in 40 years justify recent interest rate rises and a strong U.S. dollar. This comes after Fed Chairman Jerome Powell’s two-day congressional testimony where he said the U.S. was on course for years more of steady growth and reaffirmed expectations for more interest rate rises. Rising U.S. interest rates tend to boost the dollar and make gold more expensive for other holders. Elsewhere, officials from the EU Trade Commission are due to arrive in Washington next week for trade talks but the bloc is preparing a list of U.S. imports to hit if the United States imposes tariffs on EU cars. Financial leaders of the world’s 20 biggest economies meet in Buenos Aires this weekend for the first time since China and the United States put tariffs on $34 billion of each other’s goods. It seems gold cannot really get anything going on the upside. Despite what the U.S. President said, investors quickly concluded that his opinions do not count much when it comes to the Federal Reserve actions. In other precious metals, silver rose 0.9 percent to $15.41 an ounce.
Wheat futures sailed to their highest prices in more than a month on Friday on technical buying and expectations for increased U.S exports as poor crop weather hurts harvests in other countries.
|Futures Settlement Price Friday, July 20, 2018|
|S & P 500||SPM18||2805.5||2810.5||2793||2801||-4.75|
|Daily Swings (The Pivot Levels)|
Source: – News & Quotes (Courtesy: Reuters)
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