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Daily Briefing – Wednesday, August 23, 2017


Following yesterday’s enactment by the US Congress of new sanctions on Russian and Chinese entities that continue to abet North Korea’s missile program, China retaliated by warning of a breakdown in bilateral cooperation with the US – emboldening North Korea to once again threaten the US bases in Guam. At present, the VIX remains stable at 13.4 and the Yen added 0.02% towards the end of the session.



US markets opened up on Tuesday ahead of the FED’s Jackson Hole central bankers’ summit today – all eyes on Yellen’s interest rate comments… Yesterday saw a disappointing housing price index (0.1%) and relatively tame Redbook sales and Richmond manufacturing indexes. The Canadian dollar added some strength yesterday following modestly good retail sales (up 0.7% in June).



European markets yesterday snapped a 3-day losing streak, the DAX shining with a 1.35% rise – this despite a gloomy economic sentiment index from ZEW-Germany which dropped 7 points to 10, a 10-month low. The zone’s figure showed a similar tanking from 35.6 to 29.3, and the news pushed the Euro back down below 1.1175. The currency recovered overnight and is no trading at 1.1773. The FTSE added 0.86% thanks to mining shares, but the pound fell despite a 3-point rise in industrial order trends to 13.



Despite last night’s 3.6mB drawdown oil continues to trend sideways – pressured down by the API’s report of a 3rd week of gasoline inventory increases plus the return to operation of Libya’s largest oil field.



Total shares are surging after the announcement of its takeover of Maersk Oil. The deal is the latest in a chain of purchases by the oil giant, which Citigroup and DeutscheBank both mark with a huge “buy” signal. Amazon continues to struggle through the 966 resistance on its way back up towards the 1048 high from the beginning of August, whereas Google is now bouncing above support at 924. At the heart of the dichotomy is a recent report that traditional brick-&-mortar retailers are making headway in their e-commerce/click-&-collect sales model – evidenced by Wal-Mart’s 6-month rise alongside its growing cooperation with Google. Walmart this morning announced it would join the Google Express online marketplace, which enables voice-ordering in return for putting at Google’s disposal its database of consumer purchase histories.


Today’s Events

7AM – 1:45PM GMT Markit manufacturing, service & composite PMIs from France, Germany, the EU & the US
2PM GMT US: New Home sales
2PM GMT EU: Consumer Confidence
2:30 PM GMT EIA: Crude Oil Inventories
10:45 PM GMT New Zealand: Trade Balance

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