Daily Market View
Thursday, August 16, 2018
| U.S Stock Market
U.S stock index futures dropped yesterday, with investors weighing the impact of Turkey’s currency crisis as well as the escalating tariff tensions between the United States and its trading partners. While the lira continues to pull back from record lows against the dollar, Turkey doubled tariffs on some U.S imports including alcohol, cars and tobacco in retaliation to U.S moves. Meanwhile, Beijing has lodged a complaint to the World Trade Organization to help determine the legality of U.S. tariff and subsidy policies. Adding to the downbeat sentiment was a slide in oil prices due to a gloomier global economic outlook and a report of rising U.S. crude inventories, even as U.S sanctions on Tehran threatened to curb Iranian crude oil supplies. Shares of oil producers Exxon and Chevron, both members of the Dow Jones Industrial Average, slipped. Retail stock will continue to be in focus as a report is expected to show U.S. retail sales rose 0.1 percent in July, lower than a 0.5 percent increase in June.
|Major Economic Releases for Today|
|Australia Employment Change||01:30||15.0k||50.9k|
|Australia Unemployment Rate||01:30||5.4%||5.4%|
|U.K Retail Sales Ex Auto Fuel (YoY)||08:30||2.7%||3.0%|
|Euro-Zone Trade Balance (euros)||09:00||16.5b|
|U.S Initial Jobless Claims||12:30||215k|
|U.S Continuing Claims||12:30||1741k|
|U.S Housing Starts (MoM)||12:30||7.4%||-12.3%|
|U.S Building Permits (MoM)||12:30||1.4%||-2.2%|
|U.S Philadelphia Fed Business Outlook||12:30||22||25.7|
|Dow Jones Industrial Average
The Dow Jones Industrial Average declined 0.54% yesterday. The best performers of the session on the Dow Jones Industrial Average were Merck & Company Inc., which rose 1.35% or 0.90 points to trade at 67.36 at the close. Meanwhile, Procter & Gamble Company added 1.21% or 0.98 points to end at 82.29 and Pfizer Inc. was up 1.11% or 0.45 points to 41.16 in late trade. The worst performers of the session were Chevron Corp, which fell 3.79% or 4.64 points to trade at 117.94 at the close. Boeing Co declined 2.18% or 7.40 points to end at 331.74 and Caterpillar Inc. was down 2.15% or 2.90 points to 132.02.
The tech heavy NASDAQ index fell 1.23% yesterday. The top performers on the NASDAQ Composite were Pain Therapeutics Inc. which rose 76.58% to 1.960, GWG Holdings Inc. which was up 36.54% to settle at 10.09 and Citius Pharmaceuticals Inc. which gained 24.06% to close at 1.650. The worst performers were Yogaworks Inc. which was down 41.40% to 1.09 in late trade, ParkerVision Inc. which lost 33.97% to settle at 0.3830 and ReShape Lifesciences Inc. which was down 33.41% to 0.0815 at the close.
Oil prices plunged in yesterday’s trading session after government data showed a big, unexpected jump in stockpiles of U.S crude, compounding pressure as the outlook for global economic growth darkened and the stock market slumped. U.S light crude ended Wednesday’s session down $2.03 a barrel, or 3 percent, at $65.01, its lowest closing prices since June 6. The contract hit an eight-week intraday low at $64.51. U.S commercial crude inventories rose by 6.8 million barrels in the week through Aug. 10, the Energy Information Administration reported. Analysts in a Reuters’ poll had forecast stockpiles would fall by 2.5 million barrels. The jump in stocks occurred as the nation’s crude imports surged by 1 million barrels a day, while its exports fell by more than 250,000 bpd. That offset record activity at American refineries, which ran at 98 percent capacity. Stocks at the closely watched U.S delivery hub at Cushing, Oklahoma rose by 1.6 million barrels.
|Precious and Base Metals
Gold prices slipped to their lowest since January 2017 early yesterday, pressured as the U.S. dollar clung to its highest in 13 months. Spot gold was down 0.1 percent at $1,192.11 an ounce, after hitting its lowest since late January 2017 at $1,190.77. U.S gold futures were down 0.1 percent at $1,199.1 an ounce. Asian stocks sagged on Wednesday, failing to track Wall Street’s gains and with the dollar near a 13-month peak as concerns about Turkey’s financial crisis weighed on investor appetite, despite the lira’s move away from an all-time low. President Tayyip Erdogan said on Tuesday that Turkey would boycott electronic products from the United States, retaliating in a row with Washington that has helped drive the lira to record lows. U.S import prices were unchanged in July as a surge in the cost of fuels was offset by weak prices elsewhere; suggesting that a strong dollar was keeping imported inflation in check. Eurozone growth was better than expected in the second quarter, flash estimates showed on Tuesday, in a sign that the negative effects of global trade tensions might be seen only later in the year. The Chinese government is expediting plans to invest billions of dollars in infrastructure projects as its economy shows signs of cooling further, with investment growth slowing to a record low and consumers turning more cautious. SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 1.01 percent to 776.65 tonnes on Tuesday from 784.60 tonnes on Monday. South Africa’s Gold Fields said on Tuesday it plans to cut costs and 1,100 jobs at its struggling South Deep mine, sending its shares down more than 12 percent. Copper prices hit their lowest levels in 13 months yesterday and entered a bear market, potentially signaling an economic slowdown is happening around the world. Earlier this week, China reported weaker-than-expected industrial production and retail sales growth, raising worries that the second-largest economy in the world could be headed for a slowdown.
Soybeans, wheat, and corn fell in yesterday’s trading session on the back of a stronger Dollar and worries about U.S export prospects as bumper crops in the United States loom.
|Futures Settlement Price Wednesday, August 15, 2018|
|S & P 500||SPM18||2841.75||2842.75||2803||2822.25||-19.25|
|Daily Swings (The Pivot Levels)|
Source: – News & Quotes (Courtesy: Reuters)
This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.
The firm or its staff members may trade on their own account and may from time to time hold or act as market makers in investments mentioned in this document. Please note that the firm makes no warranty, expressed or implied, as to the accuracy or completeness of the information and opinions herein. All parties are advised to seek independent professional advice as to the suitability of any products and to their tax, accounting, legal or regulatory implications. City Credit Capital (UK) Ltd is authorized and regulated by the Financial Conduct Authority, reg 232015.