Daily Market View
Tuesday, August 21, 2018
| U.S Stock Market
U.S stocks closed higher for a third session yesterday as a pair of billion-dollar deals reaffirmed confidence that the U.S economy continues its steady expansion. Optimism that progress would be made toward resolving contentious trade disputes between the U.S and China also bolstered sentiment. The Dow Jones Industrial Average added 89.37 points, or 0.4%, with Nike Inc. rising 3.1% to hit a 52-week high. The S&P 500 index climbed 6.92 points, or 0.2%, led by materials and energy sectors. The NASDAQ Index reversed earlier losses to advance 4.68 points. U.S. equities rose sharply last week, on hopes for improving trade relations, as well as signs of stabilization in Turkey’s currency market. The Dow jumped 1.4%, a move that took it to its highest close since February. The S&P 500 added 0.6% and is within 1% of its record. The NASDAQ dipped 0.3% over the course of last week, but it is also within striking distance of its record. However, this week will also see the imposition of 25% tariffs on $16 billion worth of Chinese imports.
|Major Economic Releases for Today|
|RBA Meeting Minutes||01:30|
|New Zealand Credit Card Spending (YoY)||03:00||5.7%|
|Japan Nationwide Dept Sales (YoY)||05:30||3.1%|
|Japan Machine Tool Orders (YoY)||06:00||13.0%|
|U.K Public Finances (PSNCR) (Pounds)||08:30||13.3b|
|U.K Central Government NCR||08:30||13.6b|
|U.K Public Sector Net Borrowing||08:30||-2.2b||4.5b|
|Canada Wholesale Trade Sales (MoM)||12:30||0.7%||1.2%|
|New Zealand Retail Sales Ex Inflation (QoQ)||22:45||0.3%||0.1%|
|Dow Jones Industrial Average
The Dow Jones Industrial Average gained 0.35% to hit new 6-months high yesterday. The best performers of the session on the Dow Jones Industrial Average were Nike Inc., which rose 3.05% or 2.43 points to trade at 82.18 at the close. Meanwhile, Johnson & Johnson added 1.79% or 2.41 points to end at 136.88 and Merck & Company Inc. was up 1.61% or 1.11 points to 70.17 in late trade. The worst performers of the session were Walmart Inc., which fell 1.89% or 1.85 points to trade at 96.00 at the close. Intel Corporation declined 1.27% or 0.60 points to end at 46.50 and Apple Inc. was down 0.97% or 2.12 points to 215.46.
The tech heavy NASDAQ index climbed 0.06% yesterday. The top performers on the NASDAQ Composite were Seven Stars Cloud Group Inc. which rose 52.53% to 3.020, China Commercial Credit Inc. which was up 30.53% to settle at 0.7700 and Grindrod Shipping Holdings Ltd which gained 30.34% to close at 11.60. The worst performers were NF Energy Saving Corporation which was down 21.26% to 4.3700 in late trade, Aralez Pharmaceuticals Inc. which lost 19.58% to settle at 0.03 and Zion Oil & Gas Inc. which was down 16.85% to 1.530 at the close.
Oil prices edged higher today as U.S fuel markets were seen to be tightening while looming American sanctions against Iran were expected to cut supply out of global markets. U.S West Texas Intermediate (WTI) crude futures for September delivery were up 27 cents, or 0.4 percent. Traders said U.S. markets were lifted by a tightening outlook for fuel markets in the coming months. Inventories in the United States for refined products such as diesel and heating oil for this time of year are at their lowest in four years. This is occurring just ahead of the peak demand period for these fuels, with diesel needed for tractors to harvest crops and the arrival of colder weather during the Northern Hemisphere autumn raising consumption of heating oil. Outside the United States, markets focused on U.S. sanctions against Iran, which from November will target its oil sector. The impact of the Iran sanctions is not yet clear.
|Precious and Base Metals
Gold prices climbed on the back of a weaker dollar today, extending gains into a third session, after U.S President Donald Trump said he was “not thrilled” with the Federal Reserve for raising interest rates. Spot gold was up 0.3 percent at $1,193.92 an ounce after gaining 0.5 percent in the previous session. U.S. gold futures were up 0.5 percent at $1,200.6 an ounce. Trump’s remarks are having a negative effect on the U.S. dollar, and in turn, lending support to gold prices. The dollar sagged against major peers and the yen today after Trump criticized his own appointee, Fed Chair Jerome Powell, for raising interest rates. Gold is highly sensitive to rising U.S. rates, as these increases the opportunity cost of holding non-yielding bullion while boosting the dollar, in which it is priced. The U.S central bank has raised rates twice this year and targets two more hikes, with the next one slated in September. However, Atlanta Fed President Raphael Bostic on Monday said he was maintaining his expectation for one more interest rate hike this year. Meanwhile, investors looked ahead to the release of Fed’s August meeting minutes on Wednesday and the bank’s annual policy symposium at Jackson Hole later this week. Until there is a sustained sell-off in the dollar, speculators will be more prone to sell upticks in gold. In equity markets, Asian stocks rose on Tuesday, supported by hopes that Beijing and Washington would dial back trade hostilities ahead of a U.S.-China meeting this week, but comments from Trump about manipulation of the yuan and the Federal Reserve policy capped gains. Among other precious metals, spot silver climbed 0.3 percent to $14.75 an ounce. Platinum rose 0.6 percent to $798.50, while palladium remained steady at $910.50. Copper rebounded from three straight weekly declines as U.S-China trade tensions eased and a jump in orders for the metal pointed to stronger demand.
Wheat futures fell three per cent yesterday on expectations of a pickup in Russian wheat exports in the next few months as shippers try to get ahead of potential export curbs, traders said, while soybeans clung to modest advances. Corn followed wheat lower yesterday.
|Futures Settlement Price Monday, August 20, 2018|
|S & P 500||SPM18||2851.5||2860.5||2850||2859||6.25|
|Daily Swings (The Pivot Levels)|
Source: – News & Quotes (Courtesy: Reuters)
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