Gold hits a six month low – Binary Options Daily Review

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Markets Report

Thursday 21st June 2018
Prepared by Barry Jenkins, MarketsWorld Binary Options Analyst


Market Index Closing Level Move on day Intraday Market Range
CAC 5,372.31 – 18.32 5,372.04 – 5,418.20
DAX 12,695.16 + 17.19

12,670.80 – 12,760.20

Dow Jones 24,657.80 – 42.41 24,628.39 – 24,804.76
FTSE 7,627.40 + 23.55 7,603.85 – 7,705.20
IBEX 9,788.90 + 33.50 9,788.90 – 9,876.80

Closing Markets Summary

Dow Jones

U.S. stock indexes closed mostly higher on Wednesday as a rally in technology shares lifted the Nasdaq to its latest in a series of record closing highs, though the Dow Jones extended its recent losing streak to a seventh straight session. Investors dipped their toes back in the market after Tuesday’s selloff, triggered by the U.S. threat of tariffs on up to $450 billion more in Chinese products. The Trump administration dialled up the rhetoric late Tuesday, accusing China of waging a systematic campaign of “economic aggression” in a report released Tuesday. Economic data showed that the U.S. current-account deficit rose 6.9% in the first quarter mostly because of a wider trade gap in goods. Existing-home sales ran at a lower than forecast seasonally adjusted annual 5.43 million rate in May, down 0.4% from April. Companies that featured included Oracle Corp. fell 7.4% after earnings beat was followed up by weak guidance. The stock was one of the few underperformers in the technology sector, which was otherwise widely stronger on the day. Alphabet Inc. rose 1.7% while Microsoft Corp. gained 1.2%. Starbucks Corp. fell 9.6% after saying it will close more coffee shops in an increasingly crowded U.S. market. General Electric Co. dropped 0.4% after the S&P Dow Jones Indices announced Tuesday that it would remove GE from the Dow Jones Industrial Average, where it has been a component for more than a century. It will replace the conglomerate with Walgreens Boots Alliance which rose 4.7%. Walt Disney Co. rose 1.1% after it raised its offer to purchase most of 21st Century Fox to more than $70 billion in cash and stock, topping an unsolicited offer from rival Comcast Corp. Shares of Disney, Fox was up 7.2%. Comcast rose 1.8%. Synaptics Inc. jumped 9.5% after the computer-component group confirmed late Tuesday that it is pursuing a merger with rival Dialog Semiconductor PLC. PayPal Holdings Inc. rose 2% after Wedbush analyst Moshe Katri said that the company’s recently announced acquisition of Hyperwallet had strategic benefits. The Dow Jones closed down 42.41 points at 24,657.80. The S&P 500 closed up 4.73 points at 2,767.32. The Nasdaq Composite closed up 55.93 points at 7,781.52 to end at a record high. The Russell 2000 index of small-capitalization stocks also ended at a record, advancing 0.9% on the day.


European equity markets bounced off a nearly three-week lows on Wednesday as traders came to terms with the further deterioration in the trade relationship between the U.S. and China that sent equities world-wide tumbling in the prior session. The Pan-European Stoxx Europe 600 Index rose 0.3% to close at 384.29, partly recovering from a Tuesday drop of 0.7%. The euro was little changed against the dollar with the EUR/USD at 1.1585, from 1.1589 late Tuesday in New York. A measure of calm was returned to equity markets, even though the U.S. and China were still locking horns on trade issues. The Trump administration accused China of waging a systematic campaign of “economic aggression” in a report released Tuesday, which followed U.S. President Donald Trump’s indication that he wants his administration to hit China with further tariffs on $200 billion in imported goods. Trump was responding to Beijing’s threat to retaliate against U.S. tariffs with its own levies on another batch of U.S. products. Investors were are also watching developments ahead of a meeting of Organization of the Petroleum Exporting Countries and other major producers, who are gathering in Vienna. While meetings are set for Friday and Saturday, OPEC Secretary General Mohammad Barkindo on Wednesday delivered his opening speech for the group’s International Seminar, and oil ministers have started making comments on the sidelines. Oil prices were up more than 2%, above $66 a barrel. Companies that featured included Imperial Brands PLC which rose 3.2% and British American Tobacco PLC which gained 2.4%, with Liberum starting coverage on the tobacco producers with buy ratings. Etablissementen Franz Colruyt NV rose 3.7% following the Belgian retailer earnings report. On regional markets the French CAC closed down 18.32 at 5,372.31, the German DAX closed up 17.19 points at 12,695.16 and the Spanish IBEX closed up 33.50 points at 9,788.90.


The FTSE 100 closed higher on Wdenesday, with tobacco companies among biggest gainers after a positive broker note, helping the index bounce off a six-week low that it reached as trade tensions between the U.S. and China escalated. The pound rallied against the dollar with the GBP/USD at 1.3206, up from 1.3173 late Tuesday in New York. Like Asian and continental European equity markets U.K. stocks staged a recovery from Tuesday’s falls, which came as investors worried over the deteriorating U.S., China trade relationship. In Washington, the White House accused China of waging a systematic campaign of “economic aggression” in a report released Tuesday. That followed U.S. President Donald Trump’s threat to impose more tariffs on Chinese goods, adding up to levies on $450 billion in imports, after Beijing threatened to retaliate against a first round of U.S. tariffs. However the trade-war concerns seemed to be easing after the governor of the People’s Bank of China, Yi Gang, reportedly appealed for investors “not to lose confidence” in China’s “strong economic fundamentals.” Fears that Beijing would use yuan devaluation as a weapon in the trade hostilities eased, too, after China’s central bank set its reference rate for the currency at its lowest since January. Back in the U.K. lawmakers in the House of Commons voted against an amendment to the Brexit bill that would have given parliament a “meaningful vote” on the final divorce agreement. Wednesday’s vote was seen as an important victory for U.K. Prime Minister Theresa May after the House of Lords on Monday voted in favour of giving parliament more say on the final deal. Companies that featured included British American Tobacco PLC which gained 2.4% and Imperial Brands PLC rose 3.2% after Liberum started coverage of both tobacco firms with buy ratings. Ocado PLC moved up 5.6% after a broker note said that they believe the online grocery and technology company “has potential to become the ‘standard’ platform for retail logistics across all sectors as the operating system of retail.” Berkeley Group Holdings PLC dropped 5.9% after the home builder said it expects profit to be around 30% lower in fiscal 2019 and that pre-tax profit in fiscal 2018 represented a peak. Shares of other home builders also lost ground, with Barratt Developments PLC down 1.5% and Persimmon PLC 0.6% lower. The FTSE 100 closed up 23.55 points at 7,627.40.

Economic News Expected Today


Type Period Forecast Previous Importance
OPEC Meeting June     Medium
Continuing Jobless Claims June 1,730K 1,697K Low
Initial Jobless Claims June 220K 218K Medium
Jobless Claims 4 week Avg June   224.25K Low
Philadelphia Fed Manufacturing Index June 29.0 34.4 High
House Price Index April 0.3% m/m 0.1% m/m; 6.7% y/y Low
Bloomberg Consumer Confidence May   55.8 Low

Economic News Expected Today

EU  Eurozone

Type Period Forecast Previous Importance
Business Survey (France) June 108 109 Low
Trade Balance (Spain) May   -0.83B Low
Buba President Weidmann Speaks (Germany) June     Medium
Consumer Confidence June -0.1 0.2 Low

Economic News Expected Today

UK United Kingdom

Type Period Forecast Previous Importance
Public Sector Net Borrowing May 5.00B 6.23B Low
Public Sector Net Cash Requirement May   -9.710B Low
BoE MPC Vote Cut June 0 0 Medium
BoE MPC Vote Hike June 2 2 Medium
BoE MPC Vote Unchanged June 7 7 Medium
BoE Interest Rate Decision June 0.50% 0.50% High
BoE QE Total June 435B 435B Medium
BoE Gov Carney Speaks June     High

Other Global Economic Data Expected


Type Period Forecast Previous Importance
BOJ Board Member Funo Speaks (Japan) June     Medium
RBA Bulletin (Australia) June     Medium
Trade Balance (Switzerland) May 1.890B 2.289B Low
SNB Interest Rate Decision (Switzerland) June -0.75% -0.75% High
SNB Monetary Policy Assessment (Switzerland) June     High
SNB Press Conference (Switzerland) June     High
ADP Nonfarm Employment Change (Canada) June   30.2K Low
Wholesale Sales (Canada) April 0.5% m/m 1.1% m/m Medium

Economic News Round Up MarketsWorld Bars

Sales of previously-owned U.S. homes fell in May, the National Association of Realtors reported that existing home sales fell 0.4% in May from the previous month to an annualized pace of 5.43 million units. Forecasts were for a 1.5% increase to an annualized pace of 5.52 million.

British manufacturers reported a surge in orders this month after a largely sluggish start to 2018, and inflation pressures eased, the Confederation of British Industry reported that the monthly orders balance jumped to +13 this month from -3 in May, its highest since January and well above all forecasts.

Forex Round Up MarketsWorld Bars

The U.S. dollar hit an 11-month high on Wednesday against a basket of currencies before easing back as an escalating trade conflict kept investors from buying higher-yielding currencies and markets braced for growing volatility. Currency markets had breathed a sigh of relief after Beijing signalled its tolerance of a stronger currency by fixing a stronger daily midpoint than expected. Safe-haven currencies such as the Swiss franc and the Japanese yen were still well-supported, though. The euro slipped with traders wary of pushing it higher before some large option expiries this week. In addition, European Central Bank policymaker Ewald Nowotny said on Wednesday the euro weakness was caused by the growing interest rate differential between the United State and Europe. The euro/dollar was down 0.10% at 1.1578. Before Thursday’s Bank of England policy decision, the pound was slightly higher pulling away from a 7 month low. The GBP/USD was up 0.17% at 1.3198. The Australian dollar dropped to a 13-month low of $0.7347 on Tuesday before pulling back slightly to $0.7379. The U.S. dollar index was up 0.06% at 94.71.

Commodity Round Up MarketsWorld Bars

Gold prices were moderately lower on Wednesday and hit another six-month low, silver prices were slightly lower and hit a four-week low. The near-term technical postures for both metals have deteriorated the past week, which is inviting the chart-based sellers into the futures markets. August gold futures were down $4.10 an ounce at $1,274.50. July silver was last down 0.11% at $16.309 an ounce.

West Texas Intermediate crude oil prices settled higher on Wednesday buoyed by data showing a massive draw in U.S. crude supplies for the second-straight week and investor expectations major oil producers may opt for a modest output hike at a meeting this week. Inventories of U.S. crude fell by 5.914 million barrels for the week ended June 15th, topping forecasts for a draw of 2.100 million barrels. West Texas crude futures for July delivery rose 1.8% to settle at $66.22 a barrel, Brent fell 0.75% to settle at $74.52 a barrel.

The MarketsWorld Overview MarketsWorld Bars

The Bank of England left the interest rate unchanged in May, changing its intentions after data came in below forecasts. The Bank of England is again expected to leave its policy unchanged at this meeting which does not include the publication of the Quarterly Inflation Report nor a press conference. The Bank also publishes its meeting minutes at the same time and this will reveal the voting pattern. Back in May, two members voted to raise rates while seven, including Governor Carney, voted to leave it unchanged. The same pattern is forecast at this meeting.


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The information contained in this publication is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Any opinion offered herein reflects Barry Jenkins’ (MarketsWorld Analyst) current judgment and may change without notice. Users acknowledge and agree to the fact that, by its very nature, any investment in shares, stock options and similar and assimilated products is characterized by a certain degree of uncertainty and that, consequently, any investment of this nature involves risks for which the user is solely responsible and liable. This message is intended for recipient only and not for further distribution without the consent of MarketsWorld.

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