Summary:
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US500 rallies to post new all-time high
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Stock of the week: Mcdonald’s
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Oil drops on Trump comments
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Norges Bank delivers rate hike; SNB cuts inflation forecasts
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Bitcoin vol creeping up ahead of SEC decision
The push higher in US indices which began overnight on Monday has continued today, with the US500 moving above its previous peak to make a new all time high. The market has surged higher after breaching prior resistance around 2918 and the market is now looking to move on up higher and extend its gains after a period of consolidation. In fact the low of the week around 2883 came shortly after the tariffs from the US on Chinese imports were announced and it appears that it was a good example of selling the rumour and buying the fact!
McDonald’s (MCD.US), an American fast food restaurant chain, attracted increased attention this week as the EU tax probe on the company ended. In this analysis we will explain what the case was about as well as what the decision was. Later on, we will take a look at the latest earnings report of the company as well as compare it with its major competitors.
Donald Trump has caused a fairly sharp move lower in the price of Oil this afternoon after the US president tweeted that OPEC should push the price lower. The message on social media was a clear attempt to influence the market and it could well be a case of Trump looking to lower the price of gas ahead of the mid-term elections in November. Furthermore this isn’t the first time that Trump has complained about high oil prices, and there are a couple of options that he could do if he decides to make a sustained push on this.
The two central bank decisions scheduled for today came in line with expectations with the Swiss National Bank leaving rates unchanged and the Norges Bank delivering a long-awaited rate hike for the first time since 2011. While the Swiss franc did not respond at all, the Norwegian krone declined immediately after the decision as market participants had expected the more hawkish rate path.
Bitcoin, the most famous cryptocurrency plummeted to above $6000 just to bounce to almost $6500 without any particular news. Thus, what could have caused a jump in volatility? One may expect that such disorderly moves could arise more often in the days to come as a cryptocurrency community is impatiently awaiting the US Securities and Exchange Commission’s decision later this month regarding a closely watched exchange-traded fund proposal.
