News / Analysis
Finance Update – Markets Continue North as Economies go SourJuly 7, 2020
Asia – No more user info for HK from FB & Twitter
Chinese indices are up between 1.72% (Shanghai Composite) and 2.84% (Shenzhen) this morning as index futures begin to fall. The Hang Seng is down a ½% and the Nikkei – 2/3.
In Hong Kong, Facebook and Google have reportedly suspended request processing by the government for user data after the enactment of Chinese security laws.
The Yen is down 0.13% after registering a 16.2% contraction in overall household spending and a 2.1% reduction in cash earnings – both down from April’s data. The nation’s leading economic index received a preliminary 2-point addition for May.
In Australia, business confidence improved by 7% and is currently at -63%.
Europe – EU stepping up anti-Trump tariff retaliation
European benchmarks continued to enjoy market optimism yesterday, the FTSE closing up 2.09%, as the European Parliament passed yesterday a proposed bill to streamline retaliatory steps against the US-imposed trade tariffs.
The Euro is very slightly down despite missed expectations for May’s factory orders in Germany, which added 10.4% MoM, compared to the expected 15%. Industrial production figures from this morning, however, missed expectations with a 7.8% increase in May.
Eurozone investor confidence at -18.2 also missed expectations by 8 points, while retail sales came in at a satisfying 17.8% MoM.
The UK also saw a very positive doubling in June’s construction PM, which nearly doubled to 55.3.
Americas – Investment banks get SME aid
With Atlanta Fed head Raphael Bostic saying the US COVID-19 recovery is “stalling”, US indexes added between 0.78% (Russell2000) and 2.21% (Nasdaq).
The USD this morning is up 2 cents after all June PMIs came in in the green – ISM’s non-manufacturing figure breaking into expansionary mode at 57.1.
Reuters reports that the US Chamber of commerce and associated associations are urging China to implement Phase-1 purchase agreements.
Another report has US investment banks receiving tens of millions of government dollars earmarked for small businesses.
Commodities – New crypto instruments ok’d by SEC & FCA
Oil has lost 30 cents per barrel due to consumption fears as coronavirus cases surge in the US. Despite still being above $40 support, prices are being pressured down by behind-the-scenes price wars between the major players after Saudi Arabia pressured Russia to toe the production line – this despite continued infractions by OPEC members.
Meanwhile, in a court first, Dakota Access has been ordered to close down a pipeline environmentally breaching Native American tribal lands – a blow to Trump’s oil-industry deregulation efforts.
Cryptos have generally been following global stocks northward, Bitcoin cash up 7% as a new instrument is approved by the SEC – the Blockchain Transferred fund. Los Angeles-based ARCA has approved share trading in this new closed-end fund invested primarily in US bonds.
In addition, crypto exchange, Kraken Futures, has been granted a license from the UK’s FCA to provide a derivatives platform for institutional trading.
Corporate – Amazon breaches 3K
Sweden’s Ericsson (+4.3%) is being targeted for implementing Panda Electronics components in its 5G equipment.
China’s Panda, although supplying antenna equipment for Australia’s Telstra and Optus networks, is reportedly in close relations with the military – not unlike Huawei.
Ahead of its shareholder meeting today, Tesla shares yesterday jumped an inordinate 13.5% after announcing it had exceeded delivery expectations in Q2, despite the coronavirus pandemic, and Amazon added 5.8% – surging above the $3k level for the first time.
Levi Strauss will release its Q2 earnings report today after markets close. Analysts expect a 42 cent loss per share on $647.87 mn sales – half the same quarter last year.
|07:30 AM GMT||UK||House Prices|
|08:00 AM GMT||Italy||Retail Sales|
|12:55 PM GMT||US||Redbook Index. Jolts Job Openings at 14:00|
|08:30 PM GMT||OIL||API Weekly Crude Oil Inventories|
|11:50 PM GMT||Japan||Current Accounts & Trade Balance|
|05:45 AM GMT (+1)||Switzerland||Unemployment|