- Wall Street closed yesterday's session in a mixed sentiment, although benchmarks managed to erase a large part of declines, before the closing bell. The Nasdaq 100 lost more than 0.4%, but the S&P 500 gained nearly 0.14% and the DJIA more than 0.5%. Currently, futures are gaining slightly, and the key readings of the day will be retail sales (1:30 PM BST) and industrial production (2:15 PM BST)
- Declines among BigTech companies, were led by nearly 3% retreat of Apple, which is being dragged down by reports of lower orders for the iPhone16; early market data shows that bookings for the new phones are down about 13% from last year's debut of the 15 model. Nvidia also performed poorly, losing nearly 2%.
- Investors are confident that the Fed will cut interest rates, and expectations for a 50bp cut are rising; such a scenario was considered most likely by JP. Morgan, and Democrats led by Elizabeth Warren sent a letter to the Fed, asking for a 75 bp cut
- Unexpectedly, yesterday's NY Fed regional index indicated a record high since 2022 (11.5 vs. -4.3 forecasts after -4.7 previously) and the first time it has posted an increase since November 2023. Survey respondents were more optimistic about the state of the economy, although they declared slightly lower investment spending.
- New orders and deliveries turned out to be quite a bit higher, expectations for prices at about the same level as in July. Employment among those surveyed fell along with spending, at a moderate pace, but optimism about the economy's recovery came in at very solid levels ahead of Fed rate cuts
- The session on stock markets in Asia was mixed. The Hang Seng gained nearly 1.5%, but China's domestic CSI 300 lost nearly 0.5%, showing that sentiment in the mainland Chinese benchmark is weak.
- Japan's Nikkei lost 1.5%, and the KOSPI traded flat, despite a nearly 4% drop in the share price of memory chipmaker SK Hynix. India's Sensex resisted the declines and closed the session on a symbolic positive note
- Cryptocurrency market sentiment remains weak, with Bitcoin trading near $58,500, still nearly 3% below the exponential 200-session average and the average purchase price of short-term addresses as well as US ETFs, indicating that a sizable portion of investors are recording unrealized losses
- Slightly better sentiment is seen in Europe. Contracts on the DAX, FTSE and Euro Stoxx are gaining slightly; at 10 AM BST we will learn ZEW data, from Germany. The market expects sentiment in the German economy to fall further from already very low levels
- Trading in cotton contracts was halted yesterday due to elevated volatility, and today traders return to the market in a slightly less euphoric mood, trading the commodity from $72.5 per bale.
- Yesterday's euphoria in the cotton market was supported by the prospect of hurricanes (Francine, Gordon and forming new fronts in the Atlantic) in the key cotton-growing states of Mississippi and Louisiana, where flooding and heavy rains came at a crucial time in the harvest, likely reducing supply in regions where traders had until recently expected a high quality crop and sizable production
- Singapore's exports fell -4.7% month-on-month in August, compared with a 2.7% growth forecast and a 12.2% rebound in July.
- Citigroup analysts see both Harris and Trump as negative candidates for equity markets and hope for a divided Congress.
- White House economic advisor Brainard indicated that the U.S. economy can look forward to a very positive scenario in the 6-12 month horizon if good decisions are made at the monetary policy level; she stressed that a lot of new homes need to be built, as a fair share of the price pressure is due to insufficient supply in the housing market
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