- In Europe, the main indices declined. The DAX fell by over 0.5%, while the UK’s FTSE slipped nearly 0.4%. Shares of Sweden’s H&M gained almost 7% in response to the company’s reported 40% y/y increase in operating profit. Meanwhile, shares of luxury brand Brunello Cucinelli dropped sharply after Morpheus Capital published a report pointing to high valuations, weak demand, and continued business operations in Russia.
- U.S. indices fell initially after strong economic data and have since remained lower. Two hours before the close, the Nasdaq 100 and S&P 500 were down nearly 1%, with the Russell 2000 retreating the most.
- GDP and durable goods orders rose much stronger than expected. The U.S. dollar and Treasury yields surged, while expectations for Fed rate cuts fell. Q2 GDP grew at the fastest pace in almost two years, up 3.8% y/y versus 3.3% expected, while durable goods orders jumped 2.9% m/m versus forecasts of -0.3%.
- Jobless claims fell to 217,000, well below the previous 233,000 and significantly under expectations, which had not anticipated such a sharp drop. Regional Kansas City Fed data and existing home sales also came in above forecasts.
- Throughout the day, several Federal Reserve officials gave remarks. Stephen Miran stressed that the current level of Fed policy tightness is, in his view, excessive—about 150–200 basis points above neutral. However, comments from Goolsbee and Schmid were more cautious.
- On the currency market, the U.S. dollar and Canadian dollar were the strongest performers today. On the other hand, the New Zealand dollar and the British pound weakened. The Polish zloty also came under pressure amid escalating tensions between the “West” and Russia.
- Analysts at Rothschild & Co Redburn issued a ‘sell’ recommendation on U.S. tech giant Oracle, citing overestimated sales growth expectations and extreme valuations. The stock fell nearly 5%. Intel gained 6% after news that Apple may purchase a stake in the company
- Cryptocurrencies came under pressure from the stronger U.S. dollar. Bitcoin dropped below $110,000 ahead of tomorrow’s key options expiry, trading around 2% below an important on-chain level indicating that average short-term investors are now facing losses.
- Cocoa prices fell nearly 2%, dropping below the key $7,000 per ton level, following forecasts of rainfall in West Africa. Rabobank expects a cocoa market surplus in the upcoming harvest season, while demand concerns continue to dominate sentiment.
- Oil prices edged higher today and are heading toward their highest close since mid-June. According to the EIA, U.S. natural gas inventories came in slightly above expectations. NATGAS futures erased early gains following today’s contract rollover.
- Russian strategic bombers violated U.S. airspace over Alaska today, where they were intercepted by four F-16 jets. During a meeting with Erdogan, Donald Trump said the time had come for Russia to end the war. He also expressed confidence that the U.S. could persuade Turkey to halt purchases of Russian oil.
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
