Gold settles at a fresh 6 month low – Binary Options Daily Review

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Markets Report

Thursday 28th June 2018
Prepared by Barry Jenkins, MarketsWorld Binary Options Analyst

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Market Index Closing Level Move on day Intraday Market Range
CAC 5,327.20 + 45.91 5,246.41 – 5,371.58
DAX 12,348.61 + 114.27

12,124.90 – 12,439.90

Dow Jones 24,117.59 – 165.52 24,115.82 – 24,569.02
FTSE 7,621.69 + 83.77 7,512.03 – 7,633.92
IBEX 9,658.60 + 21.20 9,506.60 – 9,723.90

Closing Markets Summary

Dow Jones

U.S. stocks indexes ended lower on Wednesday erasing an earlier rally as a drop in technology stocks and financials more than offset an advance in the energy sector. The broad-market S&P 500 gathered losses throughout the day as financials closed sharply lower, and technology shares extended a recent downtrend. All three of the main indexes closed at their lowest levels in more than a month. The Dow closed at its lowest since May 3, while the S&P ended at its lowest level since May 29 and the Nasdaq ended at its lowest since May 31. The market had attempted to stage a rebound after the White House said that it would use policy instead of turning to executive orders to curb Chinese investments in U.S. technology companies. The announcement early Wednesday suggested a less-stringent tack than had originally been anticipated by President Donald Trump. Economic data showed that orders for durable goods fell 0.6% in May following a revised 1% decline in April, driven by a drop in new orders for trucks and cars. The trade deficit in goods narrowed 3.7% to $64.8 billion in May, which was below the $69.2 billion that had been forecast. U.S. pending-home sales declined 0.5% to a reading of 105.9 in May. Companies that featured included technology stocks with Microsoft Corp. down 1.6% and Google-parent Alphabet Inc. fell 1.4%. Two consumer discretionary stocks also weighed on the broader market: Amazon.com Inc. fell 1.8% and Netflix Inc. lost 2.3%. Energy stocks were solidly higher as crude-oil prices jumped 3.2% to their highest level since 2014. The rise came after a drop in crude stockpiles, a positive sign for supply. Exxon Mobil Corp. rose 1.3%, Chevron Corp. rose 1.5%, Marathon Oil Corp. climbed 2.4% and Chesapeake Energy Corp. rose 2.6%. Sonic Corp. fell 4.5% after the fast-food company late Tuesday reported disappointing revenue, even as quarterly earnings beat forecasts. The Dow Jones closed down 165.52 points at 24,117.59. The S&P 500 closed down 23.43 points at 2,699.63. The Nasdaq Composite closed down 116.70 points at 7,445.09.

Europe

European equity markets rallied on Wednesday, reversing an earlier loss as fears of a full-blown global trade war eased after U.S. President Donald Trump softened his harsh tone on Chinese investments in the U.S. The Pan-European Stoxx Europe 600 index rose 0.7% to close at 379.97, after being down as much as 0.8% earlier in the session. The euro was lower against the U.S. dollar with the EUR/USD at 1.1584 down from 1.1649 late Tuesday in New York. Stocks in Europe had opened in negative territory on Wednesday as investors grew increasingly concerned over ever-increasing tensions between the U.S. and China over trade. Worries that Europe will get caught in the crossfire have led investors to pull billions of dollars from European equity and bond funds in recent weeks, The Wall Street Journal reported. The European Union itself is also embroiled in a trade spat with the U.S. Investors were taking note of an unconfirmed report on Wednesday from SGH Macro Advisors that President Xi Jinping has warned his cabinet to get ready for a “full-scale trade war” and that the People’s Bank of China may be ready to pare back or even cut purchases of U.S. Treasurys. Economic data showed that French consumer confidence fell in June, hitting its lowest level in nearly two years. Companies that featured included BASF SE rose 1.6%, erasing an earlier loss that came after the European Commission said it has opened an in-depth probe into the German chemical company’s proposed takeover of Solvay SE’s nylon business. Banks were lower across the board, with shares of Deutsche Bank AG DBK, falling to an all-time low, down 1.7%. Energy companies moved higher as oil prices continued their move up. West Texas Intermediate crude rose 3.5% to $73 on Wednesday, trading around its highest level since November 2014, after U.S. supply data showed a larger-than-expected drop in stockpiles. Tullow Oil PLC rose 8.1%, TechnipFMC PLC climbed 5.4% and BP PLC BP. rose 3.4%. On regional markets the French CAC closed up 45.91 points at 5,327.20, the German DAX closed up 114.27 points at 12,348.61 and the Spanish IBEX closed up 21.20 points at 9,658.60.

FTSE

The FTSE 100 closed higher on Wednesday after a volatile trading session as the index moved between gains and losses until they moved firmly higher on reports that the Trump administration has backed away from invoking executive authority to impose a tough crackdown on Chinese investments in the U.S. A senior administration official said Trump will rely on existing laws rather than alternative, harsher measures that were feared to spark a dispute between Washington and Beijing. The pound was lower against the U.S. dollar with the GBP/USD at 1.3136, from $1.3222 late Tuesday in New York. Also helping the index were energy issues which rose as the oil prices continued to rally. West Texas Intermediate crude rose 3.4% to $72.92 on Wednesday, trading around its highest level since November 2014, after U.S. supply data showed a larger-than-expected drop in stockpiles. Banks were also in focus after the Bank of England’s Financial Policy Committee said U.K. lenders are strong enough to deal with a potential “hard” Brexit when Britain leaves the European Union in March. Banking shares, however, generally fell, with shares of Royal Bank of Scotland PLC down 1.1%, posting the biggest loss in the sector. Companies that featured included oil giants BP PLC which rose 3.4% and Royal Dutch Shell PLC which gained 2.8%. Whitbread PLC rose 3.4% higher after the Costa Coffee and Premier Inn parent reported a 3.2% rise in total first-quarter sales. J Sainsbury PLC rose 3.3% after Barclays lifted the supermarkets chain to overweight from equal-weight. Bunzl PLC fell 1.3% after the distribution and outsourcing company warned currency headwinds are expected to reduce revenue growth at constant exchange rates by 6%. The FTSE 100 closed up 83.77 points at 7,621.69.

Economic News Expected Today

 USA

Type Period Forecast Previous Importance
Continuing Jobless Claims June 1,725K 1,723K Low
Initial Jobless Claims June 220K 218K Medium
Core PCE Prices Q1 2.30% 2.30% Low
Corporate Profits Q1 1.9% q/q 5.9% q/q Low
GDP Q1 2.2% q/q 2.2% q/q High
GDP Price Index Q1 1.9% q/q 1.9% q/q Medium
Pen May 0.5% m/m -1.3% m/m; 106.4 High
Crude Oil Inventories June -2.481M -5.914M High
FOMC Member Quarles Speaks June     Medium
FOMC Member Rosengren Speaks June     Medium
Bloomberg Consumer Confidence June   56.5 Low
FOMC Member Bullard Speaks June     Medium
FOMC Member Bostic Speaks June     Medium

Economic News Expected Today

EU  Eurozone

Type Period Forecast Previous Importance
Retail Sales (Germany) May 0.7% m/m; 1.3% y/y 2.3% m/m; 1.2% y/y Medium
GfK Consumer Cliamte (Germany) July 10.6 10.7 Medium
CPI (Spain) June) 2.2% y/y 0.9% m/m; 2.1% y/y Medium
Retail Sales (Spain) May   0.5% y/y Low
ECB Economic Bulletin (euro zone) June     Medium
CPI (Italy) June 0.2% m/m; 1.3% y/y 0.3% m/m; 1.0% y/y Medium
Business & Consumer Survey (euro zone) June 112.0 112.5 Low
Business Climate (euro zone) June 1.40 1.45 Low
Consumer Confidence (euro zone) June -0.5 0.2 Low
Business Confidence (Spain) Low   2.1 Low
CPI (Germany) June 0.1% m/m; 2.1% y/y 0.5% m/m; 2.2% y/y Medium

Economic News Expected Today

UK United Kingdom

Type Period Forecast Previous Importance
BoE MPC Member Haldane Speaks June     Medium

Other Global Economic Data Expected

 

Type Period Forecast Previous Importance
ZEW Expectations (Switzerland) June   28.0 Low
BoC Gov Poloz Speaks June     High
RBNZ Interest Rate Decisions (New Zealand) June 1.75% 1.75% High
RBNZ Rate Statement (New Zealand) June     High

Economic News Round Up MarketsWorld Bars

Confidence among U.S consumers fell in May, the Conference Board’s index of consumer confidence decreased to 126.4 this month, compared to forecasts for a reading of 127.6. May’s reading was revised up to 128.8 from the initial 128.0. The Present Situation Index was relatively flat, 161.1 versus 161.2 last month, while the Expectations Index declined from 107.2 last month to 103.2 this month. Contracts to buy previously owned homes in the U.S. fell in May, the National Association of Realtors reported that the pending home sales index, which measures signed contracts for homes where transactions have not yet closed, fell 0.5% to a reading of 105.9 after falling by 1.3% in the previous month. Forecasts were for pending home sales rising 1.1% last month.

Forex Round Up MarketsWorld Bars

The U.S. dollar was firmer on Wednesday, reversing earlier losses after the Trump administration backed away from escalating the trade spat between Washington and Beijing. Market sentiment was boosted by indications that the U.S. is moving away from a blanket ban on Chinese firms investing in U.S. companies and instead is talking about using a strengthened security review process to deal with the issue. The dollar reversed losses against the safe haven yen, with USD/JPY up 0.32% at 110.41, off an earlier low of 109.37. The euro was lower against the stronger dollar, with EUR/USD down 0.47% at 1.1593. The pound was lower, with the GBP/USD down 0.59% at 1.3147. Sterling remained under pressure after incoming Bank of England policymaker Jonathan Haskel said Tuesday there may be more slack in the UK economy, which would weaken the case for interest rate hikes. The U.S. doll ar index was up 0.41% at 94.75.

 
Commodity Round Up MarketsWorld Bars

Gold and silver prices were moderately lower on Wednesday, with gold hitting another six-month low and silver dropping to a seven-week low. The gold market is now well oversold on a near-term technical basis and due for a decent corrective rebound very soon. August gold futures were down $4.70 an ounce at $1,255.20. July silver was down 0.6% at $16.24 an ounce.

Crude oil prices settled at their highest level since November 2014 on Wednesday, supported by a massive draw in U.S. crude supplies, and unexpected supply outages in Libya and Canada. Inventories of U.S. crude fell by 9.891 million barrels for the week ended June 22, topping forecasts for a draw of 2.572 million barrels, according to data from the Energy Information Administration. West Texas Intermediate crude futures for July delivery rose 3.2% to settle at $72.76 a barrel. Brent crude rose 1.42% to settle at $77.22 a barrel.

The MarketsWorld Overview MarketsWorld Bars

According to the second release of U.S. GDP the US economy grew at an annualized pace of 2.2% in Q1 2018, slower than beforehand but unsurprising for the first quarter of the year. The final version of GDP growth is forecast to print a similar figure. Looking ahead Q2 growth is already looks much more promising. Social Media U.S. final Q1 GDP forecast to be unrevised

 

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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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