Daily Market View
Thursday, June 28, 2018
| U.S Stock Market
U.S stock index futures slid yesterday on concerns that a worsening U.S-China trade relationship could disrupt businesses and hurt corporate profits. Futures pointed to a 0.4 percent opening loss for the S&P 500, while China’s Shenzhen-listed blue-chip index dropped 2.05 percent, adding to a 20 percent loss from its peak, venturing further into ‘bear territory’. An escalating trade dispute and tit-for-tat tariffs between the two largest economies have roiled global financial markets since early March, with the recent U.S. move to restrict Chinese investments in U.S. technology firms pushing the S&P 500 and NASDAQ on Monday to their biggest percentage declines in over two months. President Donald Trump on Tuesday endorsed a measured approach to limiting Chinese investments, saying a strengthened merger security review committee could protect sensitive American technologies. The rules are set to be unveiled on Friday. China’s commerce ministry said on Wednesday it would assess the potential impact of the action on Chinese companies.
|Major Economic Releases for Today|
|German GfK Consumer Confidence||06:00||10.6||10.7|
||ECB Publishes Economic Bulletin||08:00|
|Euro-Zone Consumer Confidence||09:00||-0.5||-0.5|
|German Consumer Price Index (YoY)||12:00||2.2%||2.2%|
|U.S Initial Jobless Claims||12:30||220k||218k|
|U.S Continuing Claims||12:30||1718k||1723k|
|U.S Gross Domestic Product Annualized (QoQ)||12:30||2.2%||2.2%|
|U.S Personal Consumption||12:30||1.0%||1.0%|
|U.K GfK Consumer Confidence||23:01||-7||-7|
|Dow Jones Industrial Average
The Dow Jones Industrial Average declined 0.68% to hit a new 1-month low yesterday. The best performers of the session on the Dow Jones Industrial Average were General Electric Company, which rose 1.60% or 0.22 points to trade at 13.96 at the close. Meanwhile, Chevron Corp added 1.48% or 1.84 points to end at 126.00 and Exxon Mobil Corp was up 1.33% or 1.07 points to 81.71 in late trade. The worst performers of the session were McDonald’s Corporation, which fell 2.17% or 3.49 points to trade at 157.42 at the close. Intel Corporation declined 1.83% or 0.91 points to end at 48.76 and Nike Inc. was down 1.67% or 1.21 points to 71.35.
The tech heavy NASDAQ index fell 1.54% yesterday. The top performers on the NASDAQ Composite were Differential Brands Group Inc. which rose 512.36% to 5.450, Medigus Ltd ADR which was up 27.68% to settle at 1.430 and Spi Energy Co Ltd which gained 19.14% to close at 0.43. The worst performers were Aquinox Pha which was down 84.72% to 2.34 in late trade, Summit Therapeutics PLC which lost 79.84% to settle at 2.55 and Pain Therapeutics Inc. which was down 71.45% to 2.435 at the close.
Oil prices jumped yesterday as plunging U.S crude stockpiles compounded supply worries in a market already uncertain about Libyan exports, a production disruption in Canada and Washington’s demands that importers stop buying Iranian crude from November. Little spare capacity remains to offset any further production disruptions, said John Kilduff, a partner at Again Capital Management. U.S. crude futures rose $2.23, or 3.16 percent, to settle at $72.76 a barrel. The contract touched $73.06 a barrel, the highest since Nov. 28, 2014. Brent crude rose $1.31, or 1.7 percent, to settle at $77.62 a barrel. U.S crude stocks fell nearly 10 million barrels last week, the most since Sept. 2016, while gasoline and distillate inventories rose less than expected, the Energy Information Administration said. Crude stocks at the Cushing, Oklahoma delivery hub for the NYMEX futures contract fell 2.7 million barrels, EIA said.
|Precious and Base Metals
Gold prices dipped to a fresh six-month low yesterday as the U.S. dollar strengthened, making bullion more expensive for buyers using other currencies. Platinum also hit its lowest level since February 2016. Gold prices have shed more than 3 percent this month – the biggest monthly loss since September – driven by a dollar rally, a large decline in gold held by exchange-traded funds and a sharp fall in speculative bets. Spot gold declined 0.3 percent at $1,255.17 per ounce, after hitting its lowest since mid-December at $1,252.04. U.S. gold futures for August delivery settled down $3.80, or 0.3 percent, at $1,256.10 per ounce. Platinum lost 0.9 percent to trade at $857.40 per ounce after touching a more than one-year low at $848.50. The main focal point of the day will be the dollar and its pressure on gold. Technical indicators suggest gold will continue to fall, with support at the psychologically-important level of $1,250 then at $1,236.60, gold’s December low. An escalating trade dispute between the United States and China has hit global stock markets, but has so far not triggered demand for gold, usually seen as a safe haven to invest during times of uncertainty. The greenback is near 2018 highs against other currencies, in part due to expectations that the U.S. Federal Reserve will hike interest rates again after raising them in June for the second time this year. Higher rates typically lift the dollar and U.S. bond yields, pressuring gold, which is priced in dollars and does not offer a yield. The head of the Dallas Federal Reserve said the U.S. central bank could raise rates at least twice more before its monetary policy stopped being accommodative, while the chief at the Atlanta Fed said he might rule out a fourth rate hike this year if the U.S.-China trade dispute worsens. A fall in holdings by gold-backed exchange traded funds tracked by Reuters also pressured gold. Meanwhile, spot silver dropped 0.5 percent to $16.17 an ounce, while palladium declined 0.9 percent at $948.40.
Wheat, Corn, and Soybeans
Soybeans edged up yesterday to extend gains into a second session, but concerns about trade tensions between the United States and China kept a lid on prices. The USDA rated 73 percent of the U.S soybean crop in good-to-excellent condition.
|Futures Settlement Price Wednesday, June 27, 2018|
|S & P 500||SPM18||2726.5||2747.75||2700.75||2706||-22.5|
|Daily Swings (The Pivot Levels)|
Source: – News & Quotes (Courtesy: Reuters)
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