Daily Summary - Oil gains due to uncertainty, market awaits inflation data

🌍 Macroeconomics and Monetary Policy

• The head of the local Chicago Fed, Austan Goolsbee, emphasized that inflation currently remains the biggest challenge for the US economy. However, he noted that the stable condition of consumers should protect the market from a deeper downturn, although he described the labor market itself as stable but far from very good.
• Existing home sales in the US in July reached 4.06 million on an annualized basis, which was minimally above the expected 4.05 million. Despite beating forecasts, the real estate market remains sluggish due to high mortgage interest rates, and prices rose by 2.0% year-over-year.
• Trade representatives from the US and Canada are finalizing the details of a potential economic agreement they plan to present next week. This initiative aims to secure trade relations against potential political changes after the presidential election.
• The rating agency Fitch Ratings warned that China's growing economic competitiveness poses an increasing challenge to the economic growth of the European Union.
• The Australian central bank (RBA) decided to keep interest rates at the current level, which met market expectations. Investors Down Under are now focusing on global impulses, awaiting key inflation data from the US.
• After 7 pm, the yield on US 10-year bonds is 4.68%, German 10-year bonds reached a yield of 3.16%, and the yield on British debt securities is 4.96%. It is worth noting that despite weak data from the US labor market and the expectation of falling inflation, yields in the US remain high, which does not justify the high prices of gold.

📈 Stock Market and Company Results

• European stock markets ended the day with mixed sentiment, but the German DAX and the Spanish Ibex managed to set new all-time highs. The German index gained 0.26%, closing at 26,391.43 pts, while the Spanish benchmark rose by 0.20%, supported by a strong corporate earnings season and hopes for de-escalation of the conflict in the Middle East. Looking at the futures contracts, DE40 is currently gaining 0.14%, and SPA35 is rising by 0.32%
• The quarterly earnings season on Wall Street is nearing its end, and investors' attention is focused on whether the current gains can maintain momentum. Positive surprises in tech company earnings have improved sentiment, but high valuations are forcing markets to be cautious ahead of the CPI inflation data release.
• The American giant Nvidia plans to launch a financing program aimed at supporting the next wave of artificial intelligence development on Wall Street. The company seeks to secure capital for hardware infrastructure development, which is intended to strengthen its dominant market position. Additionally, the company is working on a new Nemotron 4 model with a trillion parameters, which is set to directly compete with OpenAI solutions.
• Intel announced a plan to allocate $20 billion for investments intended to enable the company to return to a technological leadership position. At the same time, reports emerged in the market that approximately 33% of investor orders in the recent stock offering did not receive any share allocation.
• The sportswear manufacturers sector came under strong pressure after the disappointing financial results of the On Holding brand for the second quarter, which also decided to lower its annual revenue forecast. This translated into drops in the valuations of other industry giants, such as Nike, Puma, and Adidas.
• SpaceXAI announced the launch of the beta version of its Grok Bot software, which is intended to function as a team of virtual assistants performing business tasks. The tool has been made available to premium package subscribers on desktop and mobile systems.
• Anthropic finalized a $9.1 billion deal with Riot Platforms, a company specializing in Bitcoin mining that recently made its data centers available for AI computations.
• The calendar of publications for the coming days includes financial reports from European giants such as E.On, ABN Amro, Hannover Re, and Sampo.
• After 7 pm, the S&P 500 index futures contract is losing 0.31%, while the Nasdaq 100 is losing 0.54%, and the Dow Jones is down 0.12%.
• Meanwhile, Nvidia shares are losing 0.14%, and TSMC securities are gaining 0.49%.

💱 Currency Markets

• The US dollar is moving in a consolidation zone, and investors are holding back from larger movements ahead of the CPI inflation data publication. This reading will be a key factor for the Federal Reserve when making decisions on a potential change in interest rates in September. Inflation is expected to fall slightly but remain clearly above the target.
• The Japanese yen is once again showing weakness against major currencies, indicating that the government's previous currency interventions had only a short-term impact on the market. Investors are increasingly looking for decisive steps and rate hikes from the Bank of Japan.
• The Brazilian real was the weakest emerging market currency, losing nearly 1% against the dollar. The weakening of the currency results from growing political risk and pre-election polls favoring President Lula, which overshadowed the hawkish statements of the local central bank indicating the need to maintain a restrictive monetary policy.
• The currency pair AUDUSD became a focus of interest as the trade of the day, reacting to the RBA's maintenance of interest rates and the global sentiment related to geopolitical risk.
• As of 7 pm, the dollar index gains 0.06%

🛢️ Commodities

• Oil prices were characterized by enormous volatility during the session, returning close to the $88 per barrel Brent level. Initial gains were temporarily erased after optimistic communiques from Pakistan about a possible agreement between the US and Iran, but markets quickly returned to purchases following Tehran's tough rhetoric regarding maintaining the blockade of the Strait of Hormuz. Additionally, tensions are compounded by statements from representatives of the Iranian army and reports of incidents in other extraction regions. Ultimately, investors show great restraint, knowing that every subsequent diplomatic dispatch can drastically change the balance of power on the charts.
• The Iranian Revolutionary Guard Corps (IRGC) threatened that in the event of aggression from the US, global internet infrastructure, power plants, and thousands of kilometers of energy pipelines would be at risk. At the same time, Iranian representatives noted that potential talks with Oman regarding navigation are independent of the issue of completely closing the strategic strait.
• The US government agency EIA published the STEO report, in which it raised the forecast for US oil production in 2026 to 13.8 million barrels per day and natural gas for 2027 to 116 billion cubic feet per day. The agency also forecasts that disruptions in oil exports from the Middle East at the level of about 600 thousand barrels per day will last at least until the end of 2027.
• Cocoa prices fell today by as much as 6% after reports of improved production prospects and exports from Ghana, which reduced concerns about a global deficit of this commodity.
• In Libya, a drone attack occurred on a diesel fuel tank at the Zawiya refinery, which is another source of tension in the fuel market.
• Chile lowered its copper production forecasts for the second time in a row due to persistent operational and geological problems in the country's key mines.
• After 7 pm, gold loses 0.15%, silver loses 1.23%, while WTI crude oil gains 1.02%, Brent crude oil rises by 0.95%, while natural gas loses 0.69%, copper gains 0.08%, and corn drops by 0.31%

🪙 Cryptocurrencies

• Cryptocurrency markets recorded declines on Tuesday, and the market leader, Bitcoin, corrected below the $64,000 level due to a general deterioration in investor sentiment ahead of the release of US inflation data.
• After 7 pm, Bitcoin loses 0.79%, losing 0.79% for the whole week, while Ethereum loses 0.60%, declining by 0.60% over the week.