Daily Briefing – Tuesday, July 11, 2017
European markets experienced a healthy jolt yesterday after German exports shot up. The DAX added 0.64% and the Eurostoxx – 0.15%. Even the FTSE added 0.3%, helped by retail and aerospace. The British benchmark, however, has erased gains and is down 0.34% this morning in spite of last night’s BRC Retail sales that reported a 1.2% increase, while the Dax, ES and CAC continue their upward trend, and investor confidence fell slightly to 28.3 in July. In Italy, this morning’s industrial output for May expanded by 0.7% after April’s 0.5% contraction.
Markets yesterday closed fractions into the green, led by the Nasdaq, which gained 0.38% during the session. Ahead of tomorrow’s Beige Book, Fed Head Yellen’s speech to Congress has been leaked, in which she is expected to warn against clear bubbles in the market as she announces cuts to the central bank’s asset’s inventory. Meanwhile, consumer credit outdid expectations yesterday, rising 5.8% to $18.4bn – 6bn above target and a 7-month high.
Asian markets were once again mixed, but more divergently so, with the Hang Seng up 1.65% overnight and the Nikkei up 0.53% on a weakening Yen and excellent performance in the tech industry. The Shanghai and Shenzhen Composites were both down about a third, while Australia’s S&P was up 0.08%, after home sales came in at a lowly half percent this morning. Business confidence there rose a point in June, and business conditions quadrupled from 4 to 15.
Despite hopes of production cuts in Libya and Nigeria, oil yesterday plunged below the $43 handle before regaining losses as US markets reopened. WTI is currently trending just below support at 44.70, as the EIA projects this morning a 53% increase in shale oil investments this year. Bitcoin plunged below 2300 yesterday – a 4-week low – alongside competing crypto-currency Ethereum as a potential battle between the two looms ahead. At the source of the problem – disagreements between “miners” regarding software.
Amazon began Prime Day yesterday with a 7 point bull gap, ending up 2% at 998.81 per share. The success of the sale so far highlights the downward march of bricks & mortar retail, with Macy’s down 7%, Gap down 6.32% and Walmart down 2.8%. The sale ends tonight.
|12:55 PM GMT||US: Redbook Index|
|8:30 PM GMT||API: Weekly Crude Oil Inventories|
|0:30 AM GMT (+1)||Australia: Westpac Consumer Confidence|