US stocks near record highs after solid US data

Summary:

• Strong US data as stocks eye record highs

• Stock of the week: Boeing

• Revisions negate retail sales miss but USD still set for sizable weekly loss

• SEK declines on disappointing inflation

• Crypto mixed as investors reveal interesting salary preferences

US indices began the week coming under a little pressure but they have grown stronger as it has progressed and they look set to end the week close to record highs. The final data points of the week of note from the US have shown some positive news and taken together with the earlier retail sales numbers shows little signs of concern in the economy. The US500 is within striking distance of its record peak and is on course for a large weekly gain.

Boeing (BA.US) issued an updated forecast of Chinese demand for commercial aircraft through 2037. As China is slowly overtaking the United States as an aviation market leader, and is eventually expected to dethrone the US by 2022, securing future business in this country could be a key to increasing earnings in the years to come. In this analysis we will take a look at the demand estimates, major risks for the Boeing business in China and its latest earnings report.

The biggest economic release of the day has, on the face of it, come in as a further negative for the US dollar but when the revisions to the prior releases are taken into account the data is actually not that bad. The advance retail sales for August fell more than expected to +0.1% M/M, with the consensus forecast calling for a print of +0.4%. This miss is seen in a different light however when the revision to the previous release is taken into account, with the July figures now standing at +0.7% from +0.5% beforehand. The US dollar has lost a fair bit of ground this week with a trade weighted index close to a 2-month low.   

The Swedish krona has been by far the worst performing major currency thus far this year and taking into account the unfavourable political backdrop in conjunction with recent disappointing inflation numbers one may suppose that the currency is unlikely to recoup much of its losses. Thus, the Riksbank expectations suggesting a rate hike taking place either in December or February now appear to be tilted to the later date. The krona has slid to some extent but a decline has not been substantial probably due to crowded short positioning.

Cryptocurrencies are fairly mixed today with Dash the worst performer and down by more than 2% while Ethereum is the best as it looks to build on the strong recent gains. BItcoin is pretty much flat and trades at 6400 on the European close. Chronobank, the startup company, has asked 445 crypto enthusiasts whether they would like to be paid in cryptocurrencies. According to the results of the survey, 66% of crypto investors would like to receive salaries in virtual currencies. However, only 30% of surveyed think that companies in their countries will pay employees with digital assets. Additionally, 52% of respondents are willing to pay taxes related to their crypto revenues.