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Tuesday, January 15, 2019

Good morning, It’s Tuesday January 15th, we’re Sharptrader and this is the market view.

Europe

All eyes are on London this morning as Parliament gets set to vote on Theresa May’s Brexit deal at 7 PM UK time. Expectations are for a defeat; the question is by how many votes and will May resign in the aftermath. Yesterday’s industrial figures for the eurozone were weak, to say the least, with a 3.3% reduction year on year after October’s 1.2% increase. CPI’s today begin with France where they’re steady and the government budget is currently in a 95bn euro deficit. That’s up 10 from October.

Asia

Equities rose throughout Asia overnight despite the uncertainty in global markets.  Most were energized by Chinese officials said they were cutting taxes and providing relief to help companies weather the economic slowdown. Overnight, Japan’s machine tool orders retreated another 18.3% – that’s 1½ more than in November.

US

US indexes ended lower last night as Chinese trade data provides more proof of a global slowdown. British finance multinational Standard Chartered estimates, in a report published yesterday, that China’s GDP will overtake the US next year. Within a decade, expect India to follow suit, pushing the US even FURTHER down the list. The government shutdown, now in its 4th week, is affecting airline security and about a quarter of all federal services.

Commodities

Oil is back up above the $51 mark after performing a double bottom in the past 24 hours. OPEC ministers are scheduled to vote on additional production cuts at their Vienna meeting next month, especially since these don’t seem to have much

Shares

Citi opened our earnings season yesterday with a $ ½ bn miss on revenue but a higher EPS than expected – a dollar 61. JP Morgan will continue the data feed today after the opening bell.  We’re expecting 2.21, which’ll be a 25% increase year on year on revenues that are up 5.7%. The bank has exceeded expectations regularly for the past 2 years.

Events

In about 2 hours we’ll be hearing from the EU on the region’s trade balance, and at 1:30 GMT – US producer inflation. At 9:30, it’s the API’s turn to push oil one way or the other, and at 1:30 tomorrow morning – house prices in China.

There’ll be much more throughout the week, so stay tuned. We’ll be back tomorrow with another Market view. Till then, happy trading.

 

Monday, January 14, 2019

Good morning and welcome to an exciting week of Market Views as earnings season gets underway.

Europe

The big news today is of course Brexit, with parliament expected to vote on plan A some time within the next 48 hours. With prospects bleak, the actual d-day for Brexit could be pushed back to the end of March. Otherwise in the UK, Thursday presented a bleak roster of red results, with manufacturing down, goods trade deficit up and only the GDP exceeding expectations at 0.2% month on month for November. Other European data shows an adjusted industrial output figure for Portugal decreasing by 2.6% and contracting by 2/6% in Italy.

Asia

In China we’re seeing a strengthening of yuan thanks to optimism over trade talks with the US. The dollar, on the other hand, is weakening due to internal mayhem and a growing dovishness in the FED. Talks wrapped up last week with an extension called for; apparently both sides would like to see some kind of deal hatched. So far, China has extended grain import categories and Citigroup is set to open a joint venture on he mainland. China also announced tax incentives last week for small to medium enterprises and other steps to boost consumer spending. This morning, the nation published a $13bn expansion of its trade surplus, even as both imports and exports contracted by 7.6 and 4.4% respectively. JAPAN’S trade deficit for November on Thursday increased by 230bn yen.

US

Risk aversion is being blamed for Friday’s drop in equities as trading ended. Consumer inflation fell to 1.9% in December from 2.2 the month before; and the national economic & social institute published a .1% drop in its GDP estimate. Add to that S&P, which estimates that the government shutdown has so far cost the economy $3 1/2bn. On the other hand, it would seem that the Federal reserve is caving into white house pressure, as Jerome Powell and friends get more and more dovish by the day regarding further interest rate hikes.

Commodities

Oil turned south on Friday as investors took profit at $53 per barrel. After seeing its best week in 2 years, we’re opening THIS week at 51, with what seems to be a mid-term trend developing. Saudi production is down nearly 900 million daily barrels from November’s highs. Meanwhile gold continues to consolidate sideways towards 12-90 as dollar weakness is not quite taking hold yet.

Shares

Earnings season is beginning with profit warnings from Apple, Samsung and other market leaders. Today we’ll be getting results from Citigroup, with JP Morgan tomorrow and Goldman and bank of America on Wednesday. Netflix – Thursday.

Events

Still ahead today, Industrial production from the EU at 10 this morning, and business confidence from New Zealand at 9pm.

Join us again tomorrow for our next market view for the week. Until then, have a great trading week.

 

Thursday, January 10, 2019

Good morning, and welcome to our Friday edition of MarketWatch. It’s January 10th and here’s the morning’s updates.

Asia

Car sales in China fell nearly 20% in 2018 according to Zerohedge this morning. And yet Bank of England head told reporters yesterday that the Chinese Yuan could soon rival the US dollar as a global reserve currency. Data from Asia overnight was generally unspectacular, China’s consumer and producer price indexes disappointed expectations – 1.9% for the CPI and 0.9 for the PPI, which fell by 2/3 in December. That’s its 6th straight month of decay. Japan’s leading economic index fell 3 ticks to 99.3 in November, even as foreign reserves added about $30bn to 1.27 trillion. In Australia, December inflation measures climbed – 2.2% for consumers, 0.9 for producers, pushing the dollar up by a dramatic 30 pips. .

 

Europe

Unemployment in Europe is at a 10-year low – hitting 7.9% in November. Same stores sales in the UK regressed another .7 of a % year on year in December, even as central banker Mark Carney warned journalists that the pound could be in for further downside momentum if markets felt threatened by post Brexit UK-Europe ties. The pound for now remains steady, shifting slightly downwards halfway through the Asian session. European markets were slightly up, led by the DAX at .8 of a %.

 

US

US indexes may have topped their 4-day upshift after optimism in US – China trade talks subsides and President Trump stormed out of government shutdown talks. December’s FOMC minutes show economic optimism clashing with tightening financial conditions ahead of their latest interest rate hike. This was also at the root of their hesitancy regarding further hikes later this year. Concern was also expressed regarding Chinese growth slow and its impact on global markets. Yesterday’s FED head speeches reflected concerns and were no doubt a contributor to yesterday’s 80 cent drop in the dollar index.

Meanwhile, Canada is keeping its interest rates at 1.75%, as housing starts dropped to 213K – better than expected. Bank head Stephen Poloz said there was no rush to hike, providing a short hike in the Canadian dollar. The currency soon gave back half of that, no doubt in response to a slight drop in oil prices.

Commodities

Oil was trending gently downwards overnight after a huge $2 surge during the US session – that thanks to an equally dramatic drop in the US dollar as US markets opened yesterday morning. Also pushing prices were US-Sino trade talk optimism and a 1.7 mn barrel stocks drawdown based on yesterday’s EIA report. Another result of the dollar drop was gold adding about $15 per troy ounce during the Asian session.

Events

Today at 9 we’ll be seeing retail sales from Italy followed by credit conditions in Britain. Jobless claims will be in from the US at 1:30 GMT along with housing data from Canada. Later, more speeches from US FED members. Then more construction figures from Australia and New Zealand. Finally, at 10 to midnight, its household spending and trade balance from Japan.

Come back on Monday for next week’s market views as earnings season swings into gear. First up will be major banks throughout the week, with Netflix the first in a series of techs and media. Till then, have a great weekend.

Wednesday, January 9, 2019

Good morning, and welcome to sharptrader. It’s Wednesday January 9 and this is the market view.

Asia

Australia overnight recorded a 32% decline in building permits year over year for November, this as its services sector performance fell 3 points to 52.1 in December. Otherwise, little data in from Asia this morning, with markets all in a healthy green. The hang seng is up 2 and a ¼, the Nikkei a percent and a bit and Shanghai and shenzehen are up about .7 of a %.

Europe

Theresa May suffered another parliamentary defeat yesterday ahead of next week’s Brexit vote. This comes on the heels of an excellent increase in housing prices for November: 2.2% month on month compared to October’s 1.2% reduction, and that’s a 2-year record. Otherwise, Europe is in the doldrums, all confidence measures yesterday in the red. Economic sentiment is at a 2-year low; France’s trade deficit increased another billion euros; and this morning, that nation’s consumer confidence was down 5 points for December. Germany’s trade surplus increased, albeit with imports and exports both contracting this after yesterday’s report that Germany’s industrial production had declined nearly 2%.

US

US data was less than spectacular last night – credit change down 2 billion to 22 in November, jolts reporting a quarter million job openings less than in October and the redbook index down year on year to 8.9% as of January 4th. The government shutdown remains in place, the Democrats scoring a victory as they block a bill to condemn Syrian aggression and forward aid to Jordan. Canada’s trade deficit more than doubled to $2bn.

Commodities

Oil overnight enjoyed the news-chain’s backwinds with a 6.3 million barrel drawdown in Cushing Oklahoma, Sino-US trade talk optimism, and Saudi Arabia’s fuel cuts now official policy. WTI’s week long rise continues steady, it’s up 20% since Christmas, and we seem to have broken free of the $50 mark. The Saudis have stated that they’re targeting the $80 barrel. And despite the downpull of the US dollar, gold continues to retreat for the 4th day in a row. Support is holding at 12-80, but the highs are definitely on their way down.

Events

In an hour we’ll be getting Europe’s unemployment figures and GDP estimates for the UK. The afternoon starts with housing in Canada and a monetary policy report from their central bank at 3. At 3:30, the EIA reports on oil stocks change, and at 7 – the FED’s policy minutes. At 10 to midnight, investment data from Japan and at 1:30 tomorrow morning, Chinese inflation.

Join us again tomorrow for our Thursday edition. Till then, happy trading.

 

Tuesday, January 8, 2019

Good morning, and welcome to market view. It’s Tuesday January 8 and we’re sharptrader.

Asia

Tariff-war watchers were struck with optimism as the week began with China sending along its deputy prime minister to what were meant to be low-level talks. Yesterday, the nation’s central bank cut reserve requirement by another 100 points as manufacturing data continues to drop. Japan’s services PMI continues to drop, from 52.3 in November to 51 this past month, and it’s getting precariously close to contractionary territory. Chinese indexes closed slightly down this morning, the Nikkei and Hang Seng – up.

Europe

After last week’s surge, the pound continues rising at a slower rate with Brexit only 90 days away. Theresa May on Sunday promised to bring the agreement to parliament next week. Across the channel, economic sentiment is down despite a healthy increase in retail sales in Germany and throughout the zone. This morning’s industrial figures from Germany show a widening contraction – -1.9% in November, down from 1.9 the month before. As markets open this morning, the question is, will yesterday’s downtrend continue to ride Asia’s performance overnight or provide upward expectations ahead of the US.

US

Equities Jerome Powell seems to have caved in to White House pressure. Yesterday he said that the FED would listen to the markets before adopting any kind of policy for the coming year. Still, we’re seeing a slight tapering off of the week’s upward momentum as US indexes slide into a sideways trend. The Nasdaq added a percent and a ¼ yesterday, the Dow, .42. Bad news came from the supply management institute in the form of a non-manufacturing PMI at 57.6. Expectations had been for a point and a ½ reduction from 60.7.

Commodities

After hearing of planned Saudi export cuts to the tune of 800,000 barrels per day, WTI stopped short of the $50 barrel, overnight as we await tonight’s API report. And gold continues to hold tight to the 12-80 support and a bit, as the US dollar reacts to yesterday’s ISM figures. On one hand, we have a weaker dollar, on the other hand concerns over China-US trade talks.

Events

We’ll be getting more trade data today from France at a ¼ to 8, with confidence indicators for the EU at 10. This afternoon greenwhich time, it’ll be the US trade balance at 1:30 followed closely by the Redbook index. Oil inventories is at 9:30 with building permits from Australia at a ½ past midnight.

We’ll be back again tomorrow. Have a great trading day.

 

Thursday, January 3, 2019

Good morning, It’s Thursday January 3rd, 2019. We’re Sharptrader and this is the market view.

Asia

The Japanese yen experienced a huge 250 pip gap yesterday as trading began in Asia. No explanations have appeared for the seeming flash-crash that echoed around the world; all major Asian indexes felt the push and closed in the red, this morning, led by Vietnam’s HNX at a percent 84. Meanwhile, the People’s Bank of China said the government is proposing new measures to boost consumption, and that it – in response – would be adjusting reserve ratio requirements for bank loans to SMEs.

Europe

As most PMIs yesterday came in flat to low, the UK figure posted a welcome half point gain – not enough, though, to prevent a strong down pull on the pound as markets closed. Meanwhile, European manufacturing is at its lowest level in 3 years – Britain’s is at a 6-month high.

 

US

Congress yesterday failed to enact a bill reopening the US government, and President Trump has invited leaders to the White House. In unrelated news, US equities continue to flounder after Apple posted a downgraded outlook, prompting a distinct bear gap in index futures with the opening of Asian session. Company shares tumbled 8% and CEO Cook blamed China. US Manufacturing is at a 15-month low, yesterday’s PMI dropping a point and a ½ to 53.8.

 

Commodities

With the world still in risk mode, gold continues rising, adding nearly $8 on the troy ounce this morning. Oil continues sideways after losing half of its gains yesterday – this despite expectations of production cuts in Saudi Arabia and its OPEC allies.  

Events

Today’s afternoon will be dominated by US data, with mortgage applications in at noon jobless claims at 1:30, and the ISM’s manufacturing PMI at 3. Alongside that, we’ll be seeing construction spending. And then at 9:30 tonight, the API’s weekly crude oil inventories. After midnight, Japan reports its Nikkei manufacturing PMI and that’ll be followed by the Caixin services figure for China.

We’ll be back next week. Until then, have a great weekend.

 

Wednesday, January 2, 2019

Good morning, it’s the second day of 2019 and we’re sharptrader. Here’s the market view.

Asia

The Caixin index this morning confirms what we already knew – the Chinese manufacturing sector is contracting. Asian equities are on the way down, reflecting already red US index futures. Following the news from China, the Australian dollar is at a 2-year low.

Europe

Europe wakes up to a new year today with manufacturing PMIs rolling in. So far, we have a slowdown in Ireland, ahead of Brexit talks that will decide the future of the border between north and south. Still healthily expanding at 54.5 in December, the Irish economy was Europe’s top performer last year for the 5th time in a row.

US

The dollar is at a 4-month low as the US government opens the year – closed. The 10-day shutdown sees no signs of opening, especially with democrats set to take over the house tomorrow. Right now, the only chance for a strengthening in US currencies and stocks are deep dug within trade talks with China, also set to resume this week.

Commodities

Oil begins the year by reacting to last week’s inventory and production level reports. Last week’s EIA report shows a marked increase in US shale exports, taking a bite out of OPEC and non-OPEC members alike. In response, Saudi Arabia, for example, is slashing prices to maintain its Asian market share. In short, we’re still testing support at 44.70, but the weekly trend is slightly down. Gold on the other hand continued to rise throughout the Asian session, retracing towards the end, but certainly reflecting the anxiety we’re seeing in the VIX and the yen.

Events

As mentioned, it’s PMI day from Europe and North America today. Add the Redbook index at 5 to 2, and that’s what’s in for us this January 2nd.

We’ll be back again tomorrow with hopefully more. Till then, have a great trading year.

Monday, December 31, 2018

Good morning, and greetings towards the new year from all of us at sharptrader, this last day of December 2018.

DeutscheBank yesterday summed up the year in one word: recession, with 93% of all assets falling year on year; that’s compared to 84% in 1920. The Dow Jones had its worst performance since the depression, and the world’s rich lost over a half trillion dollars.

Asia

Overnight Chinese PMIs show a continuing weakness in manufacturing, with another ½ point drop in December but an equal growth in the non-manufacturing sector – good news or bad, depending on your point of view. The 6/10 point drop however, places the manufacturing sector in contractionary territory for the first time in 2 years. In Japan data was unimpressive, with CPIs marginally down and unemployment up a 1/10 to2.5%. Retail trade also fell to 1.4% – half the month before, and of all the Asian indexes overnight, the Nikkei was the only one to fail in posting an increase. The Hang Seng was up this morning a percent and a 1/3 on hopes that China and the US may work out some kind of deal.

Europe

With Europe on vacation, data continues to be thin. We have a drop in Switzerland’s leading indicator and red across the board with Spanish CPIs and GDPs. Import prices and CPIs in German also declined by a percent in November, but mortgage approvals were up in the UK. Equities were on the rise as last week closed, thanks to the upwind from across the seas. Again, the FTSE led the pack with a 2.3% rise. UK cabinet members told the Observer yesterday that if Theresa May’s Brexit agreement fails to pass parliament, they will delay the March deadline to July rather than risk a no-deal divorce. At this point, members on both sides of the divide are seriously considering a second referendum.

US

Pending home sales fell by 7.7% in November compared to 6.7 the month before, and jobless claims fell but not as much as hoped. Index futures are showing optimism despite Friday’s closing in the red. The Asian session opened with a 200 point bull gap along the Dow Jones, but it’s been relatively flat since.

Commodities

Oil continues upwards despite Friday’s miniscule EIA drawdown and a 2-rig uptick in the baker-hughes rig count. Support has shifted from 42 to 44 and we’re currently trading sideways in the $5 region. Gold on the other hand just may be running into resistance along its 2-month uptrend. It failed to break through 12-84 twice over the weekend and fell below 12-80 before the Asian session helped prop it back up.

We’ll be back again on Wednesday as markets kick back in with market PMIs across the globe. Until then, have a great year, invest wisely in markets, dearly in friends and family.

Monday, December 24, 2018

US

US indexes continued down yesterday, losing nearly 3% on the Nasdaq, 2 on the S&P and drawing the rest of the world southward. Volumes continue high as panic takes hold, especially with Trump threatening to fire FED-head Powell. Still, consumer sentiment was up to 98.3 in December, personal consumption up year on year and Q3 GDP was up a tenth, but down the same when annualized. While treasury head Mnuchin tries to calm markets amidst this end-of-year government shutdown, clearly that 4th rate hike was a turning point. Last week, Credit Suisse analysts said they expect at least $63bn of pension funds to be moved out of equities and into bonds. Meanwhile, in Canada, GDP and retail sales were both up a 1/3% in October based on Friday’s release.

Asia

With China’s economic conference over, we’re expecting to see tax cuts boosting domestic consumption, on one hand, but cyber tensions with the US have added another spark to the trade wars contention. China says it is considering changing existing laws to battle forced technology transfers and that hinder joint ventures with foreign companies. Indexes closed in the green this morning but less than a percent – 0.43 in Shanghai, 0.75 in Shenzhen, while both the Hang Seng and Nikkei were down – the latter on a panic-stricken yen. And Bloomberg has good news for India – it’s stock market has overtaken Germany’s to become the 7th largest in the world

Europe

Data throughout Europe has been mixed, with Italy’s trade balance growing by a 1/3 of a billion euros and public sector borrowing in the UK up to 6.3bn pounds. Total business investments fell by less than expected, and housing starts are improving. Business confidence is down throughout the continent and Friday saw consumer confidence for the union at minus 6.2; but stocks closed on Friday marginally up.

Commodities

Surprisingly, little of the panic investors are experiencing has resulted in a mass rush towards cryptos. The 4000 range continues to serve as bitcoin’s resistance area, and at least on THAT point traders are showing responsibility. Oil has been consolidating for the past 2 days as traders await OPEC’s announcement on production cuts. The proposed number is 1.2 mn daily barrels; and while a huge 10-rig cut in active platforms was reported on Friday, global growth concerns continues to pressure prices downwards. Gold has left behind its latest 12-45 support level and is now playing around in the 12-60 range. Now that the dollar seems to have bounced back from resistance at 96-60, traders are getting more and more optimistic regarding the yellow haven.

Events

Very little data up ahead. It’s the emperor’s birthday in Japan, Christmas nearly everywhere else – especially if you’re an avowed short trader. On Boxing day, we’ll be seeing the US’s Redbook index, the Case Shiller house price index and this week’s API crude oil report.

Thursday, December 20, 2018

Good morning, It’s Thursday and we’re closing in on another week of falling markets and currencies. Welcome to sharptrader.

 

Asia

Asian markets closed down yesterday, led by the Nikkei’s 2.84% which fell on a rush on safe havens. The yen is up another ½% and the Australian dollar – a 1/3. Japan’s industry activity is up nearly 2%, its central bank maintaining aa sub-zero interest rate; New Zealand’s GDP is down from 3.2% to 2.6 for Q3, and Australian unemployment surprisingly rose to 5.1% in November.

 

Europe

Construction throughout the continent and equities are all down this morning but Germany’s PPI was reported at a 20-month high of 3.3% year on year. As we move closer to Parliament’s vote on the Brexit clause, both the Euro and the pound are up .85 and .58% respectively. Stocks aren’t doing as well, with indexes down between a percent and 1 ½. With the bank of England set to raise interest rates today, chances are the move will be delayed on Brexit contentions between government and parliament. Retail prices were down yesterday but retail SALES surprised upwards, and PPIs decreased, though at a better-than-expected rate of -2.3%. That plus a slight decrease in consumer price indexes brings inflation down to a 20-month low.

 

US

US index futures continue to fall, the Dow well beyond the 23-500 mark and falling alongside the US dollar, which has lost 0.8% so far today. The dollar got a short shot in the arm after the fed raised interest rates, but the vigour soon died out when bank head Jerome Powell said increases would probably petter out in the coming year. Mortgage applications decreased painfully by nearly 6% in the first half of December, but home sales surprisingly rose by 1.9% to 5.32 million units.

 

Commodities

Oil at 46.50 continues sinking

And gold at 12-59 continues rising after dipping yesterday on the fed’s ¼% addition to interest rates.  

 

Events

Still ahead, the bank of England’s interest rate decision art noon, followed by jobs at 1:30 GMT. Japan will publish consumer price indexes at 11:30 tonight,

Thursday, December 6, 2018

Good morning, and welcome to Sharptrader. It’s Thursday December 6 and this is our view of financial markets.

US

US data was sparse yesterday owing to closed markets commemorating President Gearge Bush; and despite markets closing Tuesday down 3-4%, this morning’s index futures show no sign of relenting. Yesterday, after Donald trump had his exhuberant post handshake news of Chinese trade concessions bowled over by everyone else who was there, the US president fired of several warlike tweets threatening the middle kingdom with mayhem. The result – a dive in said futures to the tune of a percent minimum across the board, that pulled down the rest of the world with it. In other US news, Mortgage applications eased of by more than half to 2% in November. Canada is maintaining its 1.75% interest rate. It’s statement, though, warns of a downside risk to economic growth, which will probably be exacerbated by falling oil prices.

Asia

Chinese celphone manufacturer Huawei continues to be beleaguered by spying accusations, after the daughter of its founder was arrested in Canada yesterday. The news only helped to pressure stocks FURTHER down, the Hang Seng losing 2.6% over the session. Also, Japan’s central banker Haruhiko Kuroda told parliament overnight that Q3’s negative GDP growth was not in line with the country’s expanding economy, but assured speculators that he had no intention of raising interest rates or lower asset purchasing in the near future. In Australia, the local dollar declined on a disappointing trade surplus, down 600 million to 2.32 billion in October on 3% additional imports. These DECLINED in September, while retail sales added 0.3% in October. .

Europe

European retail failed to grow by the expected 2.1% in October, but still added 1.7% year on year. PMIs yesterday came in all green yesterday, except UK services which dropped 2 points to 50.4 in November – a 28-month low. With indications that Parliament will not push through Thersa May’s Brexit deal, expectations are for her to return to brussels in hopes of achieving more concessions. Meanwhile, in Germany factory orders added a paltry 1/3%, better than the expected 0.4 contraction, though, in light of continuing trade-war pessimism.

Commodities

Like yesterday, oil continues zigzagging in the 52-54 region despite the beginning of OPEC’s latest meeting in Vienna. Pundits are claiming that Saudi Arabia this week managed to pull Russia on board for further production cuts, despite the wishes of US President Donald trump. Gold reversed gains overnight, losing $5 on the ounze and bouncing off of support at 12-40.

Events

Still ahead today, US employment figures ahead of tomorrow’s NFP. At 1:30 canadian trade data, and a 2:45 US PMIs. At 3 we zigzag back to Canada fro ITS pmis, and at 2 am, foreign reserves in China.

We’ll be back in a week. Till then, trade safe and happy. 

 

Wednesday, December 5, 2018

Good morning, and welcome to all of our friends from across the world. Its Wednesday December 5th and this is the market view.

Asia

Japan’s service sector presented a lower PMI in November, down a click to 52.3 and schlepping the euro down with it. The yen rose steadily throughout the day, receding a 1/3 of the way as the Asian session got under way and is currently bouncing off a 2-week pressure zone in the 88-40 region. Indexes dropped sharply as investors began asking themselves what was in store vis-à-vis the post handshake period. What olive branches can the beleaguered Chinese economy afford to extend trump, that will postpone his tariffs beyond its new grace period? In an aside, the Caixin services PMI last night showed a 3 point improvement, placing it way into expansionist territory at 53.8.

 

Europe

The pound received a welcome jolt in the arm yesterday after the European court ruled that Britain can unilaterally halt the Brexit process at any time and with no immediate sanctions. Adding to the fanfare was an unexpected upswing in construction data – the pmi up a fifth of a point to a 4-month high. The joy was short-lived and the coin has lost all 50 pips it gained after Bank governor mark carney warned that a no-deal Brexit could cause a 10% increase in food prices OVER a 25% plunge in the UK pound. Across the region, indexes lost steam – also apparently on profit taking to the tune of a percent more or less across the board. PMis were up 4.9%, a point 3 percent improvement over October; and Italy has said that 2% is the lowest it can go on its budgetary deficit

 

US

The dollar this morning is up on equities crashing – the Nasdaq down 3.8% and the Dow 3.1. Investors Business Daily published a consumer sentiment downswing from 56.4 in November to 52.6 for this month. Fed members are showing some elasticity over a December rate hike, Jerome powell yesterday calling for patience and steve Kaplan suggesting data guidance, rather than abiding by a specific timetable.

 

Commodities

Gold hit a month-long high of 12-47 overnight before settling back to its new support level at 12-39. And oil continues trending sideways at 52 – 54 ahead of tomorrow’s OPEC Russia meeting, where a one million daily barrel production cut is expected to come into play. The API reported another 5.36 million barrel upswing in inventories.

Events

Ahead today, more PMIs from Europe with retail sales in at 10. US mortgage approvals will be in at noon followed by a Canadian interest rate decision at 3. At 10 to 12, Japan’s foreign investments, and Australia’s trade balance ends the day 40 minutes later.

We’ll be back again tomorrow. Have a great trading day.

 

Tuesday, December 4, 2018

Asia

Chinese indexes are reacting quite muted this morning following yesterday’s handshake exhuberance. The Nikkei lost 2½% as the yen added 50 pips to the dollar. Biggest losers in Tokyo include Nissan, Nintendo and  Kobe steel. Also early this morning, the Royal Bank of Australia maintained an even percent-5 as its interest rate decision,

Europe

More contention over the Brexit deal between Theresa May and parliament keeping the pound down despite favourable data yesterday. They’re demanding May reveal the full extent of the legal advice received vis-à-vis customs rules. The data – Manufacturing is up 2 full points, towering over the rest of the Union in November, and support at the 1-27 mark still holding strong. Otherwise, European indexes followed the rest of the world up yesterday, Italy’s FTSE disregarding the continued budget spat with the union and adding 2¼% and its UK counterpart – 1-18.

US

US indexes lst night ended up just over a percent, but futures this morning have given back nearly half the win. Meanwhile, t-bonds remain unimpressed with Sunday’s Trump-Xi embrace, losing point 0-15 on the 3 month yield and gaining a paltry point 0-2 on the 6. Yesterday’s manufacturing PMI is divided between a 1/10th point drop according to Markit but a point and a ½ INCREASE based on the ISM. Considering that over time, Markit’s survey enjoys a higher correlation to official figures, down is probably the way to go. Construction spending continues to contract, and vehicle sales are down 50 K – still, not as bad as expected.

Commodities

In commodities, we have oil currently entering a new range between 52 and $54 per barrel, gold peaking overnight at 12-42, and bitcoin losing another 5% leaving it back below the 4,000 mark.

Events

Ahead today, another speech from England’s Mark Carney at 9:15  GMT. At 10, PPIs for the EU, and at 5 to 2, the Redbook index. The API presents crude oil reserves at 9:30, and at ½ past midnight, Japan’s market PMI and Australia’s gross domestic product.

Monday, December 3, 2018

Asia

They’re calling it a tariffs war détente, after trump and xi ended their Sunday night dinner with a handshake. Trump’s January 1st hike has been put on hold, and China has agreed to open up markets to US agricultural, energy and industrial products, and even reduce taxes on US cars. The news was enough to propel Asian indices up – 2½% in Hong Kong, a percent point 5 in Tokyo and 3¼ in Shenzhen. The news, though failed to influence China’s PMIs, which were down in November – 50 for the manufacturing sector and 53.9 for the rest. This morning’s NON official Caixin number, on the other hand, shows manufacturing UP by a 1/10. Japan’s unemployment was up 0.1% in October, but industrial production expanded by nearly 3, following September’s ½% contraction.

 

US

US markets closed with a muted rise on Friday, but in light of the Xi-Trump handshake, index futures opened the week with an impressive bull gap – 400 points for the dow jones, 140 for the Nasdaq. The dollar took a corresponding dive, though not as dramatic, but losing 60 cents overnight. And Canada’s annualized GDP for Q3 has been downgraded from 2.9% to a level 2.

 

Europe

European data ending last week was mixed, with consumer inflation mainly stable but down a click for the zone. Retail sales in German continue contracting by a 1/3% month on month, but the yearly figure for October jumped to a positive 5%.

 

Commodities

While we wait for the market to respond to news that Qatar is leaving OPEC, Oil is up on the Russia Saudi agreement to extend output management into the coming year. But a production cut of up to a million barrels has already been priced in. Thus in spite of a 2 rig addition to the baker hughes count, oil jumped a $2 gap overnight and is currently consolidating upwards. Also, Alberta PM Rachel Notley is forcing oil companies to cut production by 9% in order to increase prices. Canada is the world’s 4th largest oil producer, and that could add to an already sour relationship with the neighbour down south. Gold continues mirroring the US dollar, adding $11 per troy ounce since dinnertime yesterday. The mid term outlook though is still neutral and commercial, large and small trader commitments are still consolidated.

Events

Markit is reporting PMIs today from across the Eu and US, with the ISM joining the party this afternoon. Other than that, speeches from the FED’s Lael Brainard and Bob Kaplan, with Australia’s interest rates at 3:30 tomorrow morning.

Thursday, November 29, 2018

US

Not a good day for the dollar yesterday, as it lost 80 cents on extremely weak economic data. October’s trade deficit increased by a billion and a ¼, consumption fell by a 1/10th%, new home sales contracted by 9% and the Richmond manufacturing index is down a point. Mortgage applications rose by 5 ½% providing at least one glimmer of hope, but then Fed head Jerome Powell drove the spike further in at his speech last night, casting a shadow over a December interest rate hike. The result – a steep dip in the dollar that, however, though, indexes are up nicely – the Nasdaq nearly 3% and the Dow, 2.5.

Europe

The pound rose in the Asian session after Yesterday’s Bank of England press conference had a unified message for brits: Brexit is bad for the economy, but – said governor carney – the agreement thatched together by Theresa May provides the best possible conditions for a very bad event. Most European indexes last night closed marginally up, the DAX and FTSE down point 9 and point 18 of a percent. This is after Germany posed some pessimistic consumer confidence in the morning followed by the 10year bond auction which concurred with a drop from 42% yields to 34. And all of this over a spat between the US and. …

Asia

… China, where indexes closed in the red this morning. Asian stocks had been following the US as the day began, but the mood turned sour as the day drew to a close, erasing all the day’s gains. In Japan Retail trade increased by a welcome 3.5%, and the Nikkei gained about a 1/3% overnight; while New Zealand’s business activity outlook for November is up 2 clicks to 7.6%

Commodities

Gold last night rose perfectly in tandem with the dollar drop at noon New York time, then opened in Asia with a $6 bull gap. The metal is right now well above its mid-term moving averages and our oh-so-gradual 3-month up trend is still in place. Oil, despite the EIA’s 3.6 mn barrel increase, reversed losses in the Asian session, but continues bouncing around the 50 and a ½ level.   

Events

At 8 this morning we’ll be having ECB president Draghi addressing the global finance forum in Frankfurt and at 7 tonight, we’ll have the minutes of the US’s fed meeting last month. In between, unemployment in Germany at 5 to 9 followed by mortgages and credit from the UK at 9:30. The Eu’s confidence measures will be in at 10, and spending, income and jobless claims in the US at 3. Unemployment, CPIs and industry in Japan is in at 10 to midnight and China’s PMIs at 1 tomorrow morning.

Wednesday, November 28, 2018

Asia

Asian markets were green this morning, the Shenzhen composite a percent 44 and the Nikkei up a percent point 11 on consumer product companies. In Australia construction work contracted by 2.8% after the year’s 2nd quarter, which registered a 1.6% increase.

Europe

European benchmarks all closed in the red yesterday. Consumer confidence in both France and Italy is down 2 to 3 points each so far this November, while with a drop from 10.6 to 10.4, Germany’s hopes for December are not much better. Shop prices in the UK advanced by 1/10th of a % erasing half of October’s loss.

US

The US dollar continues its upward trend on Trump’s promise to add Chinese tariffs come January 11st. We could be looking at a 3rd consecutive quarter of dollar gains unless continuing woes from US indexes curb the FED’s enthusiasm this coming December. Yesterday’s equities surge has tapered off somewhat, as facebook pressures the NASDAQ down to a paltry 1/100th% of an increase, the S&P up a 1/3 and the DOW point 44. The redbook index is up a percent and a ½ year on year, but house prices were down to 5.1%  in September.

 

Commodities

Oil reacted POSITIVELY to yesterday’s API addition of 3.5 mn barrels. Still, we’re not seeing any major break out of its continuing drop as demand continues to fall and hopes on an OPEC cutback remain slim. Gold continues south on dollar strength, and Bitcoin regained some of the week’s losses as an almost definite support level seems to be forming somewhere in the 3600 region – that’s after a double bottom recorded over the past 3 days.

Events

Ahead today Italy’s producer inflation measure is at 9am gmt. Then mortgage applications in the US at noon followed by the nation’s GDP, inventories and consumption measures at 1:30. At 3:30 the EIA will either confirm yesteray’s API numbers or not, and at 10 to midnight, Japanese foreign investments and retail trade. Jerome Powell’s speech at 5 PM is also something to keep an eye on.

Tuesday, November 27, 2018

Asia

Coming on the back of news that Jack Ma is a book carrying member of the Communist party, Chinese indexes this morning are all down between a ¼ and a ½%, with the Nikkei up point 8, and australia’s S&P a full percent on energy gains. Buut perhaps the biggest news is Beijing’s opening up of its finance sector with the approval of German insurer Allianz SE for business on the mainland. This comes on the heels of similar decisions vis-à-vis American express, United technologies and aircraft parts maker Rockwell Collins.  

Europe

The pound yesterday expressed some short-term optimism after the EU approved its Brexit deal with Britain. Holland’s mark Rutte warned the UK parliament not to vote against the deal, as the union had no intention of reopening negotiations. Meanwhile, the Euro also seemed to be shrugging off weak german confidence data in which all 3 measures fell about a point each. Still, European benchmarks managed to eke out impressive results yesterday, the DAX adding nearly a percent and a ½, and Italy’s FTSE nearly 3. ECB president Draghi told the European parliament that his bank would begin phasing out quantitative easing in December, come what may.

US

He USD continues on its 2-month upward trend despite what seems to be difficulty breaking the $97 mark. Indexes finally broke into positive territory, with the Nasdaq leading on a 2% increase followed closely by the dow and S&P. Trump meets China’s Xi on Friday, but not before expressing pessimism in the form of more tariffs expected on January 1st. Yesterday’s dallas manufacturing business index dropped by nearly half to 17.6 on October’s 29.4. And coming on the heels of last week’s weak data, an additional interest rate hike in December seems to be getting more and more distant.

Commodities

With OPEC members meeting in Vienna this week, oil yesterday interrupted its downward trend, hitting the 52 mark before erasing half those gains. And in cryptos, we’re seeing about700,000 bitcoin miners closing down in the past couple of weeks due to a decline in value and hashrate.

Events

Following French confidence and producer price measures, we have business confidence from Italy at 9 am GMT, followed by the Redbook index from the US at 5 to 2. House prices will be in 5 minutes later, and fed members Evans, George and Bostic speak tonight. The API is in at 9:30, and UK shop prices and Australian construction at a half past midnight.

Thursday, November 22, 2018

 It’s Thursday November 22 and this is the market view as we slip into a quiet thanksgiving weekend. We have the OECD downgrading its global growth index to 3.5%  from May’s 3.7 projection.

Asia

Japanese consumer inflation rose a tad in October to 1.4%, while foreign investments decreased  by 180 bn yen – that’s after October’s 362 bn yen increase. Despite a strengthening yen, the Nikkei was one of the few benchmarks to rise overnight, with China’s Shanghai composite down a ¼%.

Europe

More Brexit friction this morning, this time from an unexpected quarter – Spain. The country warns it will veto the bill if the deal extends to Gibraltar, which is a British holding on the Iberian peninsula. Public sector borrowing is up in the UK to 7.95bn pounds – well exceeding expectations. Across the continent, equities continue reacting to the week’s US stocks rout led by the FTSe’s point 7-2% drop.

US

US markets yesterday rebounded, with technology shares pushing the Nasdaq up by nearly an entire percent. Mortgage applications retreated again in November as did durable goods, while jobless claims increased well beyond expectations, and Home sales surprisingly rose. The Reuters Michigan consumer sentiment index is at a 3-month low, and with markets closed for thanksgiving, reactions will only be felt on Monday.

Commodities

Last night, the EIA reported a 116 thousand barrel drawdown from the Cushing reservoirs, but that wasn’t enough to curb the continuing downtrend beyond a slight bleep at the actual moment of the release. Prices continue south, at least until next month’s OPEC meeting, where hopes are that production cuts will be agreed upon. Gold continues its week-long rise crossing 12-30 momentarily during the Asian session as the us dollar relaxes into a sideways trend.

Events

Ahead today, the ECB’s policy meeting minutes are in at noon and a half, followed by consumer confidence at 3. Australia reports PMIs at 10, and japan – at a half past midnight.

 

 

Tuesday, November 21, 2018

Asia

With days to go before the Trump Xi summit at the G20, the US trade representative yesterday published a 50-page outline of ongoing Chinese intellectual property theft. Yesterday’s contagion of Asian markets, by US equity freefall seems to have abated. Most indexes closed in the green led by the Hang Seng’s ½% increase. Australia,s S&P, New Zealand’s Dow Jones, and the Nikkei all closed down. Japan’s industrial activity measure this morning shows a.9% contraction for September, while Australia’s leading index in October increased by 1/10 of a %. The central banks meeting minutes overnight has economic growth upped to 3 ½% for the coming year, but they’re keeping their present 1.5% interest rate for now.

Europe

European indexes are more optimistic this morning, all up in the ¾% plus region. Unemployment surprised to the upside in France in October, falling a tenth to 5.3%, while in the UK industrial orders increased to 10 from last month’s 6 point contraction. The pound continues to meander around the 1-28 level as investors wait for some kind of indication on Teresa May’s future and that of Brexit. While in Italy, another developing drama may be averted as deputy premiere salvini says his colleagues might be able to revise their budget deficit by lowering social benefit expenses. The threat is that otherwise the European commission may open procedures to outlaw that nation’s entire budget proposal.

US

The US dollar lost some of yesterday’s upward momentum as the index bloodbath took a slight rest during the Asian session. Yesterday’s major loser was the Dow, at minus 2.2%, this following a 1/5% reduction in building permits for October but a tenth point increase in the Redbook index. According to Bloombeerg, though, nothing seems to be on the horizon to support any optimism, and most pundits agree that the bear is upon us.

 

Commodities

Yesterday’s plunge in oil prices was quashed after the APi reported a welcome 1.6 mn barrel reduction in crude inventories. Add to that Trump saying he wouldn’t punish the Saudis for murdering a journalist, thereby quashing fears of supply disruptions. Gold yesterday added $5 to the troy ounce as investors ran for cover in light of the equities tumble.

Events

Still ahead today are mortgate applications, jobless claims and the Michigan consumers sentiment index from the US. At 1:30 – wholesale sales in Canada, and at 5 – the EIA’s crude stocks change. Finally, at 30 to midnight, Japan produces inflation and investment numbers.

 

Tuesday, November 20, 2018

Good morning, 

Asia

We’re waking up this morning to red nearly across the board, with the Hang seng down 1.9% and the Shenzhen composite down 2.8. Chinese regulators are launching investigations on price fixing against Samsung, Micron and more non-local companies. Down south in Australia, last night’s RBA minutes show confidence, with consumption growing at around the 3% target rate and unemployment down a ¼ to 4.75%. Inflation targets are up a bit and non-mining sectors not as strong as expected. Also, residential housing is retreating. But GDP, wages  and business investments are on the rise, and policy remains stable.

Europe

Contrasting November’s slow release of air from the UK housing bubble, The European Union yesterday released its construction output figures – up 2% in September following a ½% drop the month before. Unemployment in France pleased pundits who expected an increase. It’s holding steady at 9.1%. And Germany’s producers price index fell to 0.3% for October from 0.5 in September. We’re also seeing an impressive billion point 3 increase in Switzerland’s trade surplus to 3.75 in October. European stocks pushed indexes south, but by less than a percent each.

US

US benchmarks also ended down last night led by the Nasdaq’s whopping 3% drop. The National Home builders association yesterday reported a 4-year record decline in business confidence – down 7 points to 60  in October. At fault – rising prices and interest rates that’s slowing down buying.

Commodities

With the Saudi royal house in disarray and Irani backed Houthis in Yemen agreeing to a ceasefire, oil added nearly $2 on the barrel yesterday before levelling off into a slight downward incline for the Asian session. Gold, meanwhile began the session with a dip before resuming its measured upward trend, bring the winning streak into day 4..

Events

UK inflation will be on everyone’s mind at 10 this morning, with industrial trends at 11. We’ll then return to the US housing sector at 1:30, while the API will report oil reserves at half past 9. Westpac’s index for Australia will be in at 30 to midnight and Japan’s industry activity at 4:30.

We’ll be back again tomorrow. Until then – have a wonderful trading day.

 

Monday, November 19, 2018

Good morning, and welcome to sharptrader. We’re celebrating our brand new academy site, so don’t forget to check it out. Meanwhile, here’s this week’s first market view.

US

Markets have been slightly optimistic since US president trump’s Friday comments that expect a trade deal with China eventually. More gloom though was evinced when vice pence later said there would be no end to tariffs until China changes its ways. The dow on Friday closed up ½%, the S&P ¼ and the Nasdaq lost .15 of a %. Industrial production fell by half to 1/10th% – all this as Thursday’s jobless claims increase still casts a slight shadow.

Asia

In Asia overnight, we’re seeing a merchandise trade DEFICIT in Japan of nearly 450bn yen, after September;s 131bn surplus. Central bank governor Haruhiko Kuroda this morning warned that regional banks were losing money. Kuroda was addressing the Eurogroup economic forum in Paris on the topic of declining and aging populations – something Japan is unwilling to address by increasing immigration quotas. Indeed, Kuroda didn’t even MENTION his country’s abysmal record on that topic.

Europe

The Eurozone published its highest CPIs since December 2012 on Friday. ALSO speaking at Eurogroup, ECB head Mario Draghi admitted that economic growth was slowing, but not to the point that has him worried as yet. House prices in the UK contracted in November by 1.7% month on month, as the final destiny of Brexit approaches towards the end of this week. The pound overnight resumed an upward haul, but as of this morning it has yet to regain half of Thursday’s dramatic plunge.

Commodities

In commodities, oil showed a slight drop after Friday’s baker hughes report – a 2 rig increase which was nowhere near as dramatic as last week’s 14. And gold, which performed a $20 jump on Friday, has erased half of those gains, especially in Asia overnight.

Events

Today’s calendar is rather sparse. More numbers from the EU at 10 am GMT, and US housing at 3 PM. At a half past midnight we’ll be getting the minutes of Australia’s recent central bank meeting and at 2 – Japan’s monetary policy statement.
We’ll be back again tomorrow. Enjoy and good trading.