News / Analysis
Finance Update – Wall St. Catching up to MainJuly 9, 2020
Asia – Australia welcomes HK refugees
Asian indices are mostly up this morning, led by the Shenzhen Composite’s 2.23% increase, after China’s CPI added a tick to 2.5%.
The Hang Seng only managed a paltry 0.21% after Australia’s PM Scott Morrison this morning announced immigration relief measures for Hong Kong citizens fleeing Chinese security laws to Australia, including the suspension of extradition agreements with HK.
Meanwhile, this morning Australian home loans in May contracted by 7.6% – nearly double the previous reading, while business confidence in New Zealand improved from -34.4 to -29.8.
Machinery orders in Japan improved somewhat, contracting by only 16.3% in May, as BoJ Gov. Kuroda implied that the economy could begin to recover after the coronavirus epidemic recedes.
Europe – German trade surplus soars
European indices had another red day yesterday, the CAC40 losing 1.24% and the FTSE 0.55%, after the Royal Institution of Chartered Surveyors (RICS) presented a -15% housing balance for June – a vast improvement on May’s -32%.
Muted imports in May contributed to Germany’s excellent doubling of its trade surplus to €7.6 bn from the previous month’s €3.2 bn.
Americas – FED going sour
Indexes yesterday managed to add some more dollars to the corporate world, the Nasdaq climbing by 1.44% and the Dow by 0.68%.
The dollar index is down 14 cents as May’s consumer credit change came in, showing an $18.28 bn contraction. Mortgage applications for June 3rd, on the other hand, presented a 2.2% increase.
Fed officials Rosengren and Bostic both delivered dismal expectations for economic recovery yesterday. St Louis’ James Bullard, on the other hand, said he hoped job losses would abate by the end of the year.
Commodities – Oil ignores EIA
Gold, this morning at 1821, could conceivably soon break its 2011 1900 high.
Oil lost over 30 cents on the barrel yesterday, especially after the EIA’s confirmation of Tuesday’s API build. The 5.65-million-barrel addition was barrels worse than the hoped-for 3.1mB reduction.
Corporate – Walgreens & Delta to publish earnings
Airbus closed 2.18% down yesterday after announcing deliveries had risen by 36 units in June – still well below last year’s by about half.
Ford was down a half percent after revealing that sales in China had improved by 3% in the past quarter.
Bed Bath & Beyond is up 1.66% after publishing a 49% drop in sales in Q2. The company announced it would be closing 200 stores over the next 2 years.
And Daimler is down 1.18% after saying Q1 sales had dropped 19% in Q1. The company will be reporting for Q2 on the 23rd.
Later today, expect quarterly earnings from Walgreens (+0.17% BMO) and Delta Airlines (-0.015%, BMO). Expect a 40 cent drop to $1.14 EPS on a $0.5bn drop in sales YoY for the former, and a 4 cent loss per share on $1.4 bn in sales – an 89% contraction from the same quarter last year.
|12:15 PM GMT||Canada||Housing Starts|
|12:30 PM GMT||US||Jobless Claims. Wholesale Inventories at 14:00|
|10:45 PM GMT||NZ||Electronic Card Retail Sales|
|11:50 PM GMT||Japan||PPIs|