MARKET REPORT
(Unburdened by what has been)
Beurs Van Berlage
Day in Review:
Today:
(Kamalanomics: Govt-manipulated data with un-reported historic downward revisions to make the economy look more favorable):
DATA:
– Payrolls revised down 800,000 jobs!
– Net monthly payrolls now AVG 130k vs HEADLINE 230k!
– “the preliminary estimate of the benchmark revision indicates an adjustment to March 2024 total nonfarm employment of -818,000”
– FOMC Minutes Show “Vast Majority” See September Cut As Appropriate
– ‘Vast Majority’ of Fed Officials Saw September Cut As Likely Appropriate
– ‘Several’ Officials Saw a Case For Reducing Rates in July 30-31 Meeting
– Rate-cut expectations have soared since the last FOMC meeting from around 170bps (to end-2025) to 215bps, with the weight dominated in 2024
COMPANIES:
– Ford shakes up EV factories in possible $2b Pivot, delays plant and cancels electric SUV
– Target +12% on Earnings surprise
– AAPL app store head to step down
GENERAL:
– Sterling at 13-month HIGH, Euro at 12-month HIGH, YEN approaches YTD HIGH
– Euro Bourses HIGHER
– Coca-Cola hits 47-YEAR high
– Heating-oil rebounds from Multi-Year LOWS, – Crude hits 28-week LOW
– DNC Convention: Biden, Obama’s, Clinton speak. Mass pro Hamas protestors clash with police
– RFK to address nation Friday morn (joining Trump??)
– VX up 2nd session
– EIA Crude draw bigger than expected
– Cheese smoked (bazinga) AGAIN -7!%, Corn -5.54%, Wheat -6.36%, OJ +3.77%
– Equities up, Treasuries up, Crude down, Dollar down
DOLLAR DX down: 101.05 -0.38% (101.62 – 100.90) Off LOWS
– AUD UNCH: 67.43 UNCH (67.33 – 67.62) MID
– EUR down: 89.65 -0.2% (90.05 – 89.47) Off LOWS
– GBP up: 130.90 +0.45% (130.13 – 131.18) Off HIGHS
– JPY UNCH: 145.15 UNCH (146.32 – 144.46) Off LOWS
GOLD UNCH: $2550 UNCH (2533 – 2556) Off HIGHS
DOW/ES/ND up/up/up: 40983 +0.08%, 5640 +0.3%, 19898 +0.45%
CRYPTO: BTC/ETH up/up: 61043 +3.14%, 2628 1.77%
CRUDE down: $72.10 -1.46% (74.10 – 71.48) Off LOWS
Coming Up:
– Australian, Japanese, EZ, UK & US PMIs, EZ Negotiated Wages (Q2), US IJC, NZ Retail Sales
– Jackson Hole Symposium; ECB Minutes; Democratic Convention
Earnings:
– Swiss Re, Hays, Ross, Intuit, Workday.
MAJORS:
DX:
– Hit 5-month lows today:
The Dollar Index continued to see weakness on Wednesday, with the index lower heading into BLS payrolls revisions. The release saw a downward revision of 818k, with the DXY initially moving slightly higher.
The Dollar moved lower before FOMC Minutes, to the advantage of all its G10 peers, to which after the Minutes the Greenback extended its losses, falling below the 101 handle, to a low of 100.92 with December’s 2023 low of 100.61 in focus. FOMC Minutes unveiled that a vast majority of participants at the July meeting said it would likely be appropriate to ease policy in September if data continued to come in as expected, and several participants believed there was a ‘plausible case’ for a July 25bps rate cut based on recent progress on inflation and increases in the unemployment rate.
Next up on the US docket are Initial Jobless Claims and S&P Global Flash PMIs on Thursday, with the former particularly in focus as the FOMC Minutes reinforced the present significance attributed to jobs data, by noting the majority of participants said that the risks to the unemployment goal have increased, while risks to the inflation goal have decreased. Report courtesy of newquark.
– DOLLAR DX down: 101.05 -0.38% (101.62 – 100.90) Off LOWS
EUR/GBP
– Looking at YTD high to 1.1173, with 1.12 the next key level, and the July 2023 high of 1.1276 going beyond.
Money markets price ~96% of a 25bps rate cut in September, reinforced by ECB’s Panetta remarks where he hopes they cut in September.
Thursday will see the release of EZ, French, and Germany Flash PMIs, alongside EZ Consumer Confidence Flash (Aug) and ECB Minutes.
– EUR down: 89.65 -0.2% (90.05 – 89.47) Off LOWS
– GBP up: 130.90 +0.45% (130.13 – 131.18) Off HIGHS
AUD:
AUD/USD peaked at 0.6760, before Judo Bank PMI Flash data, as the cross continues to approach July’s 2024 high of 0.6798
– AUD UNCH: 67.43 UNCH (67.33 – 67.62) MID
YEN:
– UNCH on the Day.
– JPY UNCH: 145.15 UNCH (146.32 – 144.46) Off LOWS
GOLD/SILVER:
– Joe Cavatoni, senior market strategist at the World Gold Council, noted current demand from central banks is well above the five-year average — reflecting heightened concern with inflation and economic stability. He also pointed to ongoing geopolitical tensions, among other factors, that have caused some to buy gold.
The wars in Ukraine and Gaza have notably fueled uncertainty around the world. The United States is also amid a tumultuous election year — which could prove crucial to future economic policy.
All eyes are also on coming economic news that could impact financial markets (Sept meet)
GOLD UNCH: $2550 UNCH (2533 – 2556) Off HIGHS
EQUITIES
EUR:
– DAX +0.51% 18,452
– FTSE +0.12% 8,283
– CAC +0.52% 7,525
– ES50 +0.33% 4,885
US:
– SPX +0.42% 5,621
– NDX +0.53% 19,825
– DJIA +0.13% 40,890
– RUT +1.32% 2,171
Sectors (W to S): Financials -0.14%, Energy -0.01%, Communication Services +0.17%, Health +0.22%, Real Estate +0.33%, Technology +0.46%, Industrials +0.62%, Consumer Staples +0.62%, Utilities +0.74%, Materials +1.15%, Consumer Discretionary +1.18%
BONDS:
– Treasury yields tumbled today with the short-end outperforming (2Y -6bps, 30Y -1bps). The entire curve is now below pre-CPI levels of yield
– smashing the 2Y yield back below 4.00% (having stalled at pre-CPI high yields)
BONDS:
US 1-MO 5.305 -0.024
US 6-MO 4.884 -0.042
US 1-YR 4.407 -0.046
US 5-YR 3.654 -0.047
US 10-YR 3.799 -0.019
US 30-YR 4.076 +0.006
2YR/10YR -0.013 +0.005
OIL:
– WTI (V4) SETTLED USD 1.24 LOWER AT USD 71.93/BBL; BRENT SETTLED (V4) USD 1.15 LOWER AT USD 76.05/BBL
The crude complex was lower on Wednesday, extending on its weakness seen on Tuesday, as the Chinese economy/demand continues to weigh with geopolitics in the background.
On the Middle Eastern footing, ceasefire negotiations seem to be going nowhere as things stand, while the new head of Israeli military intelligence stated they continue to strengthen preparations for the expansion of the war in the north, and later reports noted that Gaza truce talks have reached an impasse.
Elsewhere, in the weekly EIA data, crude and gasoline saw greater than expected draws, while distillate saw a surprise draw, with the weekly crude production rising 100k to 13.4mln.
On the day, WTI and Brent edged higher throughout the European session to hit peaks of USD 74.16/bbl and 78.21/bbl, respectively, but sold off notably throughout the US session to settle at lows, albeit on no single headline just wider sentiment. Note, weakness in oil was seen after the BLS payrolls revisions, which saw a significantly lower number of jobs added in the year to March than previously reported, pressuring investor sentiment. Report courtesy of newsquark.
CRUDE down: $72.10 -1.46% (74.10 – 71.48) Off LOWS
CRYPTO
– Building on that potential, CoinTelegraph reports that several of Bitcoin’s popular trading metrics are flashing positive which may force traders to act quickly and cover their positions if macroeconomic events align, according to a crypto analyst.
“Technical indicators are improving, and with some traders holding short positions, there’s potential for a short squeeze,” 10x Research head of research Markus Thielen said in an Aug. 21 report.
– In an Aug. 18 report, CryptoQuant researcher Axel Adler looked to two key metrics – the bubble vs. crush market structure and the ratio between the difference of market cap and realized cap and the standard deviation of market cap (MVRV-Z score) – as signals that Bitcoin’s current price action is tracking a healthy path forward.
“We can see that the current bull cycle is developing quite steadily without significant anomalies or sharp jumps,” Adler added.
Adding to the bullish sentiment, US spot Bitcoin ETFs have maintained positive flows for eight out of the past ten consecutive trading days. On Aug. 20, the ETFs saw an aggregate inflow of $88 million, their highest for two weeks…
CRYPTO: BTC/ETH up/up: 61043 +3.14%, 2628 1.77%
KEEP DOING WHATS WORKING, STOP WHAT ISNT
Best of luck out there. Let the market come to you
Post of the day:
https://www.youtube.com/watch?v=tv6W0Nv5ev0
Song of the day:
https://www.youtube.com/watch?v=oIO5lfJ9dhs
Joke of the Day:
https://www.youtube.com/watch?v=RbeaXtEzM4A
(Seize all assets of Duke and Duke enterprises)
I can be contacted should anyone have any questions, input at [email protected] during US hours of EST 9am until 5pm
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