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    Ahead of US retail data

    US stocks were mixed on Thursday with telecommunications and consumer staples increase compensating for slump in Apple stocks. Apple Inc stocks tumbled 2.35% to $90.34, their lowest since 2014, on worries demand for iPhones may be falling which pushed the Nasdaq index 0.49% lower to 4,737.33 S&P 500 index has been rallying since February but in recent 2 weeks it is looking down weighted on by weak corporate earnings. At this moment, the index is 1% since the start of the year. On Thursday both S&P 500 (see S&p 500 historical prices) and Dow Jones indices ended almost flat after mixed trading. Dow Jones added 0.05% to 17,720.5. S&P 500 lost 0.02% to 2,064.11 with seven out of ten its major sectors ending higher and telecommunications and consumer staples leading the growth ( 0.72% and 0.54% respectively). Kohl’s Corp shares slumped 9.17% on underwhelming quarterly sales. Two Fed officials claimed on Thursday the rates are to be hiked subject to economic improvements in the US. The Q1 earnings season is coming to an end with earnings data being above the preliminary expectations: the total earnings of S&P 500 components fell only 5.4% compared to the Q1 2015. The trading volume on the US exchanges on Thursday was 7.2bn in line with the average for the recent 20 trading days. US dollar index, a measure of a greenback’s value against a basket of six major currencies, advanced 0.2% to a two-week high of 94.442 as two Fed officials claimed on Thursday the rates are to be hiked subject to economic improvements in the US. Previously, on Tuesday, the volume of shorts in US dollar reached the 3-year high and seems that investors felt uncomfortable with such a big position against the US currency.

    Today at 14:30 CEST the retail sales for April, gross and ex autos, will be released in US, the outlook is positive for both. AT the same time several producer price indices will be released for April, the outlook is positive. At 16:00 CEST the preliminary Michigan University consumer sentiment index for April and business inventories for March will come out, the outlook is positive as well. At 19:00 CEST the Baker Hughes US oil rig count will be known, the current count is 328.

    European stocks opened lower today after the sharp drop in Apple shares even despite the positive economic data from Germany and amid falling oil prices. Early this morning the Germany’s consumer price index for April came out in line with expectations. Nevertheless, the Germany’s officials expect the national GDP growth to slow in second quarter while the China’s slowdown weighs on demand for European goods. EURUSD fell 0.4% to a 14-day low of $1.1329. British FTSE 100 lost 0.48% today and is set for a 4th straight week of losses, down 5.4% from its April high. French CAC40 loses 0.4% and German Dax 30 index loses 0.10% so far. FTSEurofirst index is 0.5% down today while the Euro STOXX 50 index loses 0.8%. Investors are cautious about the European markets given uncertainty about the Brexit referendum. Automaker BMW stocks lost 3.4%, the insurance sector fell 1.7% on weak corporate earnings data. Today at 11:00 CEST the preliminary seasonally adjusted GDP for Q1 will be released in Eurozone. The tentative outlook is neutral. No more significant data are expected in Eurozone today.

    Asian stocks edged lower today with Japanese Nikkei index losing 1.4% to 16,412.21 after four days of gains. Still, the index managed to end this week 1.9% higher. Broade Topix index lost 1.3% to 1,320.19 but closed the week 1.7% higher. USDJPY lost 0.2% to 108.52 yen having rebounded from a fresh 18-month low of 105.55 set last week when the BoJ did not expand its monetary policy.

    Oil futures prices reversed down today after their 3-day winning streak as expensive dollar made oil positions more expensive. US WTI crude futures were traded at $46.20 a barrel, down 50 cents while Brent futures prices fell 32 cents to $47.76 a barrel. OPEC members increased the oil production volumes by 32mln barrel a day in April to the highest volumes since 2008, according to the OPEC report on Friday. Moreover, OPEC, Russia and other major oil producers failed to reach an agreement on freezing output on April 17. At the current moment, the average oil oversupply in the global markets is around 950 thousand barrels a day.

    Gold edged up 0.8% to $1,273.01 an ounce today after its 1.1% fall on Thursday. Gold is to end this week 1.2% lower.


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