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Daily Briefing – Thursday, August 10, 2017



After weeks of dip buying against a background of escalating tension between the White House and Pyongyang, the only signs of green on this morning’s index map are in Denmark, Saudi Arabia and the S&P’s VIX index. US productivity gained slightly in Q2 with a better-than-expected 0.9% increase, but wholesale inventories rose to 0.7% for June. Across the border, Canada’s housing market experienced 222K unit starts and a 2.5% increase in building permits.




Asian markets were struck by selloffs overnight as the battle rhetoric rises. The Hang Seng led major benchmarks with a 0.96% loss while the Nikkei only lost 0.01% as the Yen seems to be escaping safe-haven wrath. Machine orders in Japan fell 1.9% and foreign investments fell in stocks, but climbed in bonds. The Royal Bank of New Zealand overnight decided to maintain a 1.75% interest rate level, forecasting a hike in the 2nd half of 2019.  And Australia’s consumer inflation expectations for August have dropped 2 ticks to 4.2%



European stocks will open this morning with a 1.4% deficit in the CAC40 and 1.37% in the Eurostoxx, while the FTSE is escaping relatively unscathed at a mere 1/5% loss. British house prices fell unexpectedly to 1% in July




Despite hints from Washington that Trump’s aggressiveness do not reflect policy, the nuclear war-of-words has had its effect on equity markets and sent traders running for safety – pushing gold to a 2-month high after breaking through support at 1280 yesterday. Proof of risk aversion comes in oil, which – despite the EIA’s -6.45mB confirmation of the previous day’s API report – continues to trend in the $49 region. OPEC has reiterated its March deadline on production caps, US shale may rise thanks to relatively high prices, but the spotlight seems to be elsewhere.



Not just Trump, but Disney too yesterday cost FANG stocks dearly, Netflix dropping 50 points. Today’s major news will be NVidia’s quarterly earnings, which should present 70c on the share  for revenues of $1.95bn. The company is supplying Tesla’s autopilot systems and is a major producer of Graphics Processors for the rapidly developing blockchain market.


Today’s Events

8 AM GMT Italy: Trade Balance
8:30 AM GMT UK: Manufacturing & Industrial production, Trade Balance, and GDP estimate at noon.
12:30 PM GMT US: PPIs & Jobless claims followed at 2 with a speech by William Dudley and the monthly budget statement at 6

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