Date: 27th August 2024.


Market News – Stocks mixed; Big Tech pulled down; Oil unchanged amid supply concerns.


Asia & European Sessions:


* US: Some steam came out of Friday’s rally as Treasuries and Wall Street corrected from overbought conditions. The bond market had already priced in at least a -25 bp rate cut on September 18, though yields dropped further following Chair Powell’s confirmation. With little on the docket until Thursday’s claims data, the market gave back some of its gains. There was also a little concession building ahead of the start of the $183 bln in auctions.
* The S&P500 rose to 5651 in early action, but failed to test the record high of 5667 from July 16. The NASDAQ slumped -0.85% on profit taking ahead of Nvidia earnings Wednesday. The Dow was up 0.16%.
* Several technology companies tip the market because of their big values. Nvidia lost 2.2%, Microsoft fell 0.8%, Amazon dropped 0.9%, Meta Platforms slid 1.3% and Tesla lost 3.2%.
* China: Industrial profit data for China was robust, but mainland China bourses still struggled, while the Hang Seng managed slight gains.
* Europe: The Stoxx Europe 600 climbed 0.3% at the open, DAX and FTSE 100 are currently up 0.1% and 0.4% respectively. The UK is catching up after the extended holiday weekend.
* German data confirmed that GDP contracted -0.1% q/q in the second quarter and GfK consumer confidence data unexpectedly declined, which coupled with deteriorating business confidence flags recession risks.


Financial Markets Performance:


* The USDIndex index is at 100.85.
* EURUSD and Cable are consolidating but remain at high levels at currently 1.116 and 1.319 respectively. Both flagged that monetary policy will have to remain restrictive for the time being. That won’t prevent additional rate cuts, but highlights that central banks will move cautiously.
* USOil closed with a 2.9% pop to $77.04 after news Libya was shutting supply added to the bullish impact of increasing tensions in the Middle East.
* Gold firmed to $2509 per ounce on geopolitical risks and rate cut prospects.


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Please note that times displayed based on local time zone and are from time of writing this report.


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Andria Pichidi
Market Analyst
HFMarkets

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