Amazon delighted investors on Thursday posting earnings of 65 cents/share vs 35 cents/share expected. Cost cutting policy has allowed the company to expand its overall margin even if its money making AWS business profit margin declined to 24.2% from 29% a year earlier. The stock jumped 9% after hours. Apple beat soft Wall street expectations but overall sales fell 1% y/y and so did the stock, -2% in extended trading. Yesterday US indices closed off the lows after some in-line Jobless Claims data but Yields on the long end – both 10Y and 30Y are eyeing last October’s highs– are putting pressure on stocks: US100 is down 2.5% so far this week while US500 is -1.8%. PPI in Europe have shown a negative reading for 6 months in a row, 3 months for the Core component highlighting not only the deflationary risk but the economy slowing down. Crude and Brent jumped after the Saudis and Russia confirmed the extension of their production cuts in September (even if Russia is down to 300k bpd from 500k previously). Later today the ”pivotal” NFP data is expected to come in at +200k in July, down from +209k: that would be the lowest monthly change since DEC 2020. A beat would probably push rates even higher and be a drag on the market.
- FX – USD Index -0.14% at 102.21, AUDUSD gains after Monetary Policy Statement (+0.22% at 0.6565), USDJPY at 142.41 after having strengthened in yesterday’s afternoon session.
- Stocks – US Futures are up: US500 +0.36%. US100 +0.60%, US30 +0.18%. DAX is firmly trading below 16k. Russell 2000 remains short of eclipsing its 52-week high. Berkshire hits a new ATH. Airbnb slid after hours after bookings grew at a slower than expected rate.
- Commodities – USOil at $81.74, spread against UKOil at $4.48 close to recent lows.
- Gold – Firmly below $1940 on higher rates, XAG underperforms -0.32%.
Today: EU retail sales, DE Factory Orders (just out +7% vs -2% expected), US NFP, Unemployment, Average Hourly Earnings, Canadian Unemployment.
Biggest Mover: (@6:30 GMT) LTCUSD (-3.38%) trading at $ 82.05, within this year’s wide range and close to a support area + 200d MA. RSI negatively sloped, MACD negative.
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Marco Turatti
Market Analyst
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