While the earnings season is getting into full swing – Bank of America, Morgan Stanley, Bank of New York but also Novartis and Ocado will report today – the stock market in 
the DMs cannot help but be bid: the US indices are very close to their annual highs while the European indices are not far from them. On the one hand we have the Italian FTSE MIB close to highs since 2008, on the other the French CAC which ”suffers” particularly when Asian sessions are in the red (probably given the prevalence of luxury in that index). Today, HK plays the catch up (in negative) after yesterday’s session was suspended due to a typhoon, dragged by real estate (again?) and tech stocks. Right now, the 5.58% September due bond of Dalian Wanda -China’s leading commercial property investor and operator- are extending their fall to 60! All APAC is in red, with a fractional exception from Japan. Also, most US banking giants cut their Chinese growth estimates to 5% yesterday after poor data. RBA minutes stick to the same old rhetoric. Focusing on some corporate news, Activision Blizzard gained (+3.49%) after Microsoft and British regulators held “productive” talks to finalize the $69 billion merger; Ford fell after lowering the price of its electric F-150 truck (by 10k). Yesterday, the Reuters’ wire report of a Saudi voluntary cut extended to December 2024 (!!) was declassified as a ”fat fingers” mistake after causing a sharp upward and then downward movement of about $2 within minutes.
- FX – USDIndex remains sub-100.00, EURUSD hovers around 1.1250, Cable is eyeing a test of 1.31 to the upside. JPY, CHF, CNH strengthened.
- Stocks – US Futures are flat, Hong Kong -1.84%. Next week, US regulators set to propose new capital regulations (mortgages).
- Commodities – USOil is flat and back where it was before the glaring error of one of the world’s leading news agencies. Copper weak yesterday on China (-2.26%), flat today (+0.08%).
- Gold – attacking $1960 again after falling as low as $1945.86 yesterday; government bonds at the long end are trying to defy the weight of gravity.
Today – US retail sales (between inflation and strong job market), Industrial production / Capacity Utilization / Business inventories, CAD CPI, EU Commission’s Economic Growth Forecast.
Biggest Mover @ (06:30 GMT) Coffee (-3.07% @ $154.45) trading lower, testing last week’s lows, RSI (31.61) and MACD are both negative, 50DMA & 200DMA are both negatively inclined in the $177 area right now.
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Marco Turatti
Market Analyst
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