US markets close lower as Trump warns North Korea – Binary Options Daily Review

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MarketsWorld

   
Markets Report

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Wednesday 9th August 2017
Prepared by Barry Jenkins, MarketsWorld Binary Options Analyst

 
Market Index Closing Level Move on day Intraday Market Range
CAC 5,218.89 + 11.00 5,191.38 – 5,231.65
DAX 12,292.05 + 34.88 12,184.60 – 12,330.00
Dow Jones 22,085.34 – 33.08 22,057.29 – 22,179.11
FTSE 7,542.73 + 10.79 7,518.45 – 7,551.85
IBEX 10,734.70 + 58.20 10,665.20 – 10,758.20

Closing Markets Summary

Dow Jones

Stocks in the US gave up early gains to close lower on Tuesday as President Donald Trump issued a verbal warning to North Korea amid mounting tensions between Washington and Pyongyang. The three major equity indexes dropped to session lows, before bouncing, in late-afternoon trade as President Trump’s warned that North Korea would be met with “fire and fury” if the Hermit kingdom continues to provoke the US with missile tests and acerbic rhetoric. “They will be met with fire and fury like the world has never seen,” The comments come as the Washington Post reported that North Korea has successfully produced a miniaturized nuclear warhead that it can fit inside a missile, a fact that, if true, further escalates global tensions. Trump’s comments during his vacation also bumped the so-called fear index, CBOE Volatility Index slightly higher, up 11%, at 10.98. That still represents a historically low reading for the index, which is used to bet on sharp swings in the S&P 500 index 30 days in the future. Economic data showed that sentiment among small-business owners jumped in July and the Labor Department reported that the number of job openings in June jumped to 6.16 million from 5.7 million in May. Companies that featured included financials that had been the day’s best performers until pulling back in the afternoon. Avis Budget Group Inc. dropped nearly 10% after the car-rental company late Monday posted quarterly results that missed market forecasts. Marriott International Inc. fell 2.1% after the hotelier posted a quarterly earnings beat, but guided profit for the current quarter slightly below forecasts. CBS Corp. rose 1.8% after the media giant also reported results late Monday, with revenue topping forecasts. Michael Kors Holdings Ltd. jumped 22% as profit at the clothing and accessories company came in ahead of forecasts. Ralph Lauren Corp rose 13% on its own results. Dean Foods Co. fell 21% after its earnings came in below forecasts. SeaWorld Entertainment Inc. fell 6.25% as revenues missed forecasts. The Dow Jones closed down 33.08 points at 22,085.34. The S&P 500 closed down 5.99 points at 2,474.92 and the Nasdaq Composite closed down 13.31 points at 6,370.46.

Europe

European equity markets closed slightly higher on Tuesday and close two week highs as a drop in the Euro helped regional equities push past the disappointing trade data from Germany and China that cast doubt on the strength of global economies. The Pan-European Stoxx Europe 600 index closed up 0.2% at 382.65, and its strongest finish since July 26th. The Euro EUR/USD slipped 0.42% to below $1.18 to $1.1730 after trading as high as $1.1826 intraday. Economic data showed German exports fell by 2.8% on the month in June, the first decline in exports this year. Imports also dropped, but at a faster rate of 4.5%, which meant the trade surplus widened slightly. Chinese trade data showed July exports and imports grew at a slower pace than in recent months. Companies that featured included Pandora which fell 13.7% after the jewellery retailer said quarterly net profit fell 10% to 1.1 billion Danish kroner, below forecasts of 1.24 billion kroner. The company also said it would pay 110 million Euros to buy the distribution rights for its jewellery in Spain, Gibraltar and Andorra. InterContinental Hotels shares fell 4% on concerns about slower room-revenue growth. First-half pre-tax profit rose 9.4%, and the company, whose brands include Holiday Inn and Crowne Plaza, raised its interim dividend by 10%. On regional markets the CAC closed up 11.00 points at 5,218.89, he DAX closed up 34.88 points at 12,292.05 and the IBEX closed up 58.20 points at 10,734.70.

FTSE

The FTSE closed slightly higher on Tuesday and the highest level since in early June, helped by the Pound’s drop against the Dollar following an upbeat reading on US job openings. The index briefly traded above its all-time closing high of 7,547.63 hit in late May, but eased back into the close. The Pound dropped 0.45% against the Dollar to $1.2966. Mining stocks were initially were under pressure after the release of Chinese trade data, which showed July exports and imports grew at a slower pace than in recent months, but they managed to erase losses. Iron-ore producer BHP Billiton PLC closed 0.1% higher, while peer Rio Tinto closed down 0.3%. Retail stocks shook off early weakness that had come as the British Retail Consortium said U.K. retail sales in July slowed from a year ago. Sales rose 0.9%, compared with 1.1% a year earlier. Next PLC shares were initially lower, but finished up by 0.9%. Marks & Spencer Group PLC rose 1% and DIY retailer Kingfisher PLC rose 1.3%. Standard Life PLC ended down 0.3% after the financial services company posted a 14% decline in first-half pre-tax profit, hurt by a fall in revenue and investment returns. Standard Life did raise its interim dividend to 7 pence a share. InterContinental Hotels fell 4% on concerns about slower room-revenue growth. First-half pre-tax profit rose 9.4%, and the company, whose brands include Holiday Inn and Crowne Plaza, raised its interim dividend by 10%. The FTSE closed up 10.79 points at 7,542.73.

Economic News Expected Today

 USA

Type Period Forecast Previous Importance
MBA 30 Year Mortgage Rate August   4.17% Low
MBA Mortgage Applications August   -2.8% w/w Low
Nonfarm productivity Q2 0.7% q/q 0.0% q/q Medium
Unit Labour Costs Q2 1.2% q/q 2.2% q/q Medium
Wholesale Inventories June 0.6% m/m 0.6% m/m Low
Crude Oil Inventories August -2.800M -1.527M High

Economic News Expected Today

EU  Eurozone

Type Period Forecast Previous Importance
Industrial Production (Italy) June 0.2% m/m; 3.4% y/y 0.7% m/m; 2.8% y/y Low

Economic News Expected Today

UK United Kingdom

Type Period Forecast Previous Importance
No Data        

Other Global Economic Data Expected

 

Type Period Forecast Previous Importance
Westpac Consumer Sentiment (Australia) August   0.4% Medium
Home Loans (Australia) June 1.5% m/m 1.0% m/m Medium
CPI (China) July 0.2% m/m; 1.5% y/y -0.2% m/m; 1.5% y/y Medium
PPI (China) July 5.5% y/y 5.5% y/y Medium
Building Permits (Canada) June -2.0% m/m 8.9% m/m Medium
RBNZ Interest Rate Decision (New Zealand) August 1.75% 1.75% High
RBNZ Monetary Policy Statement (New Zealand) August     Medium
RBNZ Rate Statement (Australia) August     High
RBNZ Gov Wheeler Speaks (New Zealand) August     High
Electronic Card Retail Sales (New Zealand) July 0.3% m/m 0.0% m/m; 4.5% y/y Medium

Economic News Round Up MarketsWorld Bars

The number of job openings in the US rose more than forecast in June. In the release of the monthly Job Openings and Labor Turnover Survey (JOLTS), the US Labor Department reported that the number of job openings, excluding the farming industry, settled at 6.163 million in June from 5.702 million a month earlier, which was revised from the original reading of 5.666 million. Forecasts were for the number of job openings to increase to 5.775 million at the end of the second quarter from May’s initial reading. A measure of US small-business confidence rose in July, boosted by strong hiring and an improving economic outlook, the National Federation of Independent Business reported that the group’s Index of Small Business Optimism rose to 105.2 from 103.6 in June. The rise was the index’s first since January.

German imports fell more sharply than exports in June, pushing the trade balance to a 10-month high, the Federal Statistics office reported that seasonally adjusted exports dropped by 2.8%, the sharpest fall since August 2015 that ended five consecutive months of growth. Imports were down 4.5%, the biggest drop since January 2009. Both figures were below forecasts with exports forecast edge down 0.3% and imports rising by 0.2%. The seasonally adjusted trade surplus widened to 21.2 billion Euros from 20.3 billion Euros in May, reaching its highest level since August 2016. The June reading was higher than the forecast of 21.0 billion Euros.

China’s exports and imports grew much less than forecast in July, China’s overall trade continued to grow at a healthy pace in July, but at 8.8% it was the slowest rate this year. China’s export growth slowed to 7.2% in July from a year earlier, the weakest pace since February and cooling from an 11.3% rise in June, forecasts were for a 10.9% gain. China’s imports rose 11.0%, the slowest growth since December and down from a 17.2% rise in the previous month. That also missed expectations of 16.6% growth. Leaving a trade surplus of $46.74 billion for the month, the highest since January, compared with forecasts for $46.08 billion and June’s $42.77 billion.

Forex Round Up MarketsWorld Bars

The Dollar turned higher against the other major currencies on Tuesday, after an upbeat US employment report which added to optimism over the strength of the job market and the US economy. The US Labor Department reported that the number of job openings, excluding the farming industry, settled at a record-high 6.163 million in June from 5.702 million a month earlier, which was revised from the original reading of 5.666 million. Forecasts were for the number of job openings to increase to 5.775 million at the end of the second quarter from May’s initial reading.

In the Eurozone, data showed that German exports fell by 2.8% in June, snapping five months of gains. It was the biggest drop since August 2015. German imports dropped by 4.5%, the largest decline since January 2009. That drove Germany’s trade surplus up to €21.1 billion, from €20.3 billion in May, a 10-month high. The EUR/USD was down 0.39% at $1.1748.

The GBP/USD was down 0.59% at $1.2957, just off the previous session’s one-and-a-half week low of 1.3014. The USD/JPY was steady at ¥110.76 and the USD/CHF was up 0.34% at Fr0.9757.

The Australian and New Zealand dollars were both lower with the AUD/USD down 0.21% at $0.7896 and the NZD/USD was down 0.53% at $0.7322. The USD/CAD rose 0.13% to CAD$1.2696, not far from Monday’s three-week high of CAD$1.2714. The US Dollar index was up 0.36% at a fresh one-week high of 93.66.

 
Commodity Round Up MarketsWorld Bars

Gold futures settled slightly lower on Tuesday in a choppy trading session as the Dollar rallied in late trade, helping to erase a slight advance for the Dollar-sensitive metal. December gold closed down $2.10 lower at $1,262.60 per ounce. September silver was up $0.134 at $16.38 per ounce.

Oil futures settled lower for a second session on Tuesday as investors awaited details from an OPEC meeting to discuss an agreement to limit crude oil production. Prices got a brief lift on reports that Saudi Arabia is expected to cut sales of oil supplies to Asia by up to 10% next month but lingering worries over excess supply offset any positive impact. West Texas Intermediate for delivery in September fell $0.22 to settle at $49.17. October Brent crude reversed early gains to finish down $0.23 at $52.14 per barrel.

The MarketsWorld Overview MarketsWorld Bars

The weekly crude oil inventories report can not only have a significant impact on oil prices it can also impact the Canadian dollar and the Dollar, with an inverse correlation on the latter. The recent rise in oil prices goes hand in hand with the fall of the Dollar. In the last report a smaller than expected draw of 1.5 million weighed oil prices. In this report a draw of 2.8 million is forecast.

Monitor the Canadian Dollar for Binary Options trading.

 

 

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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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Written by Barry Jenkins

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