- European equities started August in upbeat moods
- US Senate agrees infrastructure bill draft
- US ISM manufacturing data came out weaker than expected
- WTI crude fell more than 4%
European indices finished the first session of the month higher amid solid corporate earnings and economic data. HSBC Holdings first-half pre-tax profit more than doubled from last year when it set aside $7 billion (€5.9 billion) to cover pandemic-related bad loans. Company also said it would pay an interim dividend. Heineken posted solid quarterly figures but warned costs could eat into margins, a sign of rising inflationary pressures. On the data front Germany's retail sales topped analysts' projections while Europe's manufacturing growth remained near the recent high.
US indices launched the session in upbeat moods with the Dow Jones hitting a fresh intraday high and the S&P 500 approaching record levels as US senators finalized details on Sunday of a sweeping $1-trillion plan to invest in roads, bridges, ports, high-speed internet and other infrastructure. Senate Majority Leader Chuck Schumer is pushing for the bill to be passed before the chamber goes on recess on Aug. 9. However, moods worsened slightly after the publication of the ISM manufacturing report which pointed to the second consecutive month of slowing factory growth.
WTI crude fell more than 4.0% and is trading slightly above $71.00 a barrel, while Brent is trading 3.40% lower around $73.80 a barrel partially due to concerns over a slowdown in China’s economy, which is the second-largest oil consumer in the world. A private survey showed factory activity in China fell sharply last month, as demand contracted for the first time in more than a year. Also according to Reuters report oil output from OPEC rose in July to its highest since April 2020. Elsewhere gold rose 0.18% and is trading slightly above $ 1,816.00 / oz, while silver is trading 0.15 % higher, around $ 24.90 / oz. Friday's NFP report will be in the spotlight this week. Disappointing figures could support bets the Fed won't taper anytime soon, which could move gold prices higher.
USDJPY pair has been moving inside a descending channel recently and today reached major support at 109.20 which is marked by previous price reactions. Should the break lower occur, then downward move may accelerate towards next support at 108.40. On the other hand, if buyers manage to halt declines here, then the nearest key resistance to watch lies at 110.00 and is strengthened by 50 SMA (green line). Source: xStation5
The content of this report has been created by X-Trade Brokers Dom Maklerski S.A., with its registered office in Warsaw, at Ogrodowa 58, 00-876 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. X-Trade Brokers Dom Maklerski 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.