MARKET REPORT
(Unburdened by what has been)
Old Vienna Bourse
Day in Review:
Today:
(Kamalanomics: Govt-manipulated data with un-reported historic downward revisions to make the economy look more favorable):
DATA:
– Michigan consumer sentiment hit a 4-month high
– Former NY Fed President Dudley said at a forum in Singapore that he thinks “there’s a strong case for 50”
– Traders are now pricing in a 49% chance of a 50 basis point move next week, compared with 15% at one point on Thursday.
– For the week, the S&P 500 is poised to gain 3%, the Nasdaq 4.7%, and the Dow 1.8%.
COMPANIES:
– Costco Wholesale increased to an all-time high of 919.00 USD. Over the past 4 weeks, Costco Wholesale gained 6.31%, and in the last 12 months, it increased 62.53%
– Boeing shares dropped 3.7% after the company’s largest labor union went on strike, disrupting airplane assembly at several factories.
– Adobe tumbled 8.5% following a disappointing earnings outlook
– Uber surged 6.4%
GENERAL:
– The Russian ruble weakened beyond 91 per USD, nearing new four-month lows, as traders assess the economic and monetary outlook. The Bank of Russia raised its key interest rate by 100bps to 19% in its September meeting and left the door open for another hike in October. Policymakers also revised their inflation forecasts for Russia higher to 6.5%-7% for the year. It currently stands at 9.1%.
– JPM reiterates 50bps Fed rate cut
– GS stays with 25bps
– Equities up, Treasuries up, Crude down, Dollar flat.
Coming Up:
– FOMC, BoJ, BoE, US & UK Retail Sales, UK, Canada & Japan CPI, Australian jobs and New Zealand GDP
DX:
– The Dollar was more-or-less flat on Friday and within a thin range, 100.880-101.190, in pretty thin newsflow as all attention is on the FOMC next Wednesday, although dipped beneath that 101 level on the dovish repricing.
On this, Refinitiv money market pricing now has the magnitude of the cut (25 or 50bps) as a coin flip and the pricing has turned more dovish in the past day or so after a WSJ Timiraos’ article citing a former Fed adviser and comments from former Fed President Dudley got airing. Briefly recapping, Timiraos suggested that it could be a close call between 25 or 50bps and Dudley stated that if he was still on the committee, he would be pushing for a 50bps reduction. There was also an FT preview that noted 50bp is still an option while JPMorgan said they still expect a 50bp cut. Goldman Sachs still see a 25bp move, however. Report courtesy of newsquark.
EUR/GBP
– Slew of ECB speak after the central banks rate decision on Thursday, which was broadly in line. EUR/USD hit a peak of 1.1101, but couldn’t sustain any move above the psychological round level, and the strength stemmed from a scaling back of dovish ECB bets as an October cut is now seen as more unlikely post-Lagarde yesterday alongside the aforementioned dovish repricing at the Fed
EQUITIES:
EUR:
– DAX: +0.92% at 18,689, FTSE 100: +0.39% at 8,273, CAC 40: +0.41% at 7,465, Euro Stoxx 50: +0.61% at 4,843
US:
– SPX +0.54% at 5,626, NDX +0.47% at 19,515, DJIA +0.72% at 41,394, RUT +2.49% at 2,182
Sectors (W to S): Utilities +1.41%, Communication Services +1.02%, Industrials +0.98%, Materials +0.89%, Consumer Staples +0.61%, Real Estate +0.59%, Consumer Discretionary +0.51%, Technology +0.42%, Energy +0.42%, Financials +0.34%, Health +0.19%
GOLD/SILVER:
– Gold increased to an all-time high of 2573.00 USD/t.oz. Over the past 4 weeks, Gold gained 5%, and in the last 12 months, it increased 34.64%
– Silver increased to an 8-week high of 30.19 USD/t.oz. Over the past 4 weeks, Silver gained 9.42%, and in the last 12 months, it increased 33.37%.
OIL:
– WTI crude oil futures dipped slightly to $68.65 per barrel on Friday, breaking a two-day winning streak, as production and refining activities in the U.S. Gulf Coast resumed.
Official data showed that nearly 42% of oil production, amounting to over 730,000 barrels per day, remained shut in due to the storm. Despite these supply disruptions, oil prices faced downward pressure amid ongoing concerns about sluggish demand in key markets. The IEA warned of slowing global oil demand growth, particularly driven by China’s weakening economy, and projected a potential supply surplus in 2024, even with continued OPEC+ production cuts.
Earlier data this week revealed a 3.1% decline in China’s crude oil imports from January to August 2024 compared to the same period last year. In the U.S., demand concerns grew as oil and fuel stockpiles increased last week. Despite these headwinds, oil recorded its first weekly gain in five weeks, rising about 1.5%.
CRYPTO
Any size of rate cut bodes well for growth assets like cryptocurrencies as they reduce the opportunity cost of holding assets that don’t provide yields. In a low-interest-rate environment, investors are more inclined to seek assets with higher potential returns, even if they involve greater risk.
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/shorts/T4SBemiVWjE
Song of the day:
https://www.youtube.com/watch?v=UK_CuMJJLwg
Joke of the Day:
https://www.youtube.com/watch?v=_5jAUgJATAg
(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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