Daily Summary: Moody's downgrade and weak Chinese data spook investors

Global financial markets were in risk-off moods today amid disappointing Chinese trade data, Italian windfall tax and Moody's downgrade of US banks

Chinese exports dropped 14.5% YoY in July (exp. -12.5% YoY) while imports were 12.4% YoY lower (exp. -5% YoY)

Italian FTSE MIB slumped 2.2% after Italian Senate approve 40% windfall tax on banks

Moody's downgraded 10 small- and mid-sized US banks and put 11 on negative outlook. Moreover, some large institutions like US Bancorp of Bank of New York Mellon were put under review for potential downgrade

Wall Street indices trade lower but off the daily lows. S&P 500 and Dow Jones drop 0.8% while Nasdaq and Russell 2000 drop 1.1%

European stock market indices traded lower today as well. German DAX dropped 1.1%,  UK FTSE 100 moved 0.36% lower, French CAC40 dropped 0.69% and Dutch AEX finished 0.66% down

Fed Harker said that the US central bank will need to hold rates steady for a while. Harker said he expects core PCE to decline to just below 4% by the end of this year and to reach 2% target in 2025

Fed Harkin said that unless there are major surprises in data by mid-September, Fed may be able to stay patient and keep rates unchanged. Harker also said that rate cuts will likely start sometime next year

Fed Barkin said that inflation remains too high but the labor market is 'remarkably resilient'

Saudi Arabia said that it will continue to support OPEC+ precautionary efforts to ensure stability in oil markets

US trade balance for June came in at -$65.5 billion (exp. -$65.1 billion)

Canadian trade balance for June came in at -C$3.73 billion (exp. -C$2.8 billion)

US wholesale inventories dropped 0.5% MoM in June (exp. -0.3% MoM). Wholesale sales were 0.7% MoM lower (exp. -0.2% MoM)

Japanese household spending dropped 4.2% YoY in June (exp. -4.2% YoY)

Oil has been trading lower today and was down 3% at one point, after the release of disappointing trade data from China. However, situation began to change in the afternoon and declines were almost completely erased

Precious metals trade lower pressured by stronger USD - silver dropped 1.6% while platinum and palladium plunged over 2%. Gold dropped 'only' 0.6%

Industrial metals traded lower with nickel, zinc, aluminum and copper dropping over 1% today

Cryptocurrencies bucked the 'risk-off' trend and traded higher today. Bitcoin gained 2.2%, Ethereum jumped 1.6% and Dogecoin rallied 2.5%

USD, GBP and CHF are the best performing G10 currencies while NZD and AUD lag the most