Daily Video Review - 29/07
- Donald Herison
- English
- MARKETS NEWS
- Hits: 1151
Here are 4 tips for today's trading. This will help you decide where you should invest and what to look for:
Global investors are shifting their focus from Chinese markets to the Federal Reserve today.
1) Chinese markets gain
The Shanghai Composite index and Shenzhen index both regained some lost ground Wednesday, closing with gains of 3.4% and 4.1% respectively.
Markets are stabilizing after intervention by officials aimed at halting a crash that saw the Shanghai Composite drop 8.5% Monday -- its biggest percentage fall in a day since 2007.
Chinese equities have been on a wild ride since the start of the year.
2) Focus on the Fed
Now that Chinese markets are closed for the day, investor attention is shifting to the Federal Reserve. The Federal Open Market Committee issues its decision on interest rates at 2 p.m. ET.
"Markets expect the central bank to withhold an interest rate hike this time around, putting the focus on the statement accompanying the announcement for further guidance," said Ilya Spivak, a currency strategist at DailyFX.
Many expect a rate hike could come later this year as the U.S. economy improves.
3) Stock market overview
U.S. stock futures are edging higher ahead of the open.
European markets are mixed in early trading.
Across Asia, market moves were relatively muted, except for the gains in China.
Looking back to Tuesday's trading, the Dow Jones industrial average rose 1.1%, the S&P 500 climbed 1.2% and the NASDAQ jumped 1%.
4) Movers and shakers
Akamai Technologies (AKAM), a cloud services company, saw its stock drop about 10% in extended trading following weak earnings.
Shares in insurance company Assurant (AIZ) are up about 10% in extended trading after releasing better-than-expected quarterly results.
And shares in Gilead Sciences (GILD) are up 4% premarket after its earnings beat expectations.
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What is it? It's an excellent gauge of future construction activity because obtaining government approval is among the first steps in constructing a new building. Construction is important because it produces a wide-reaching ripple effect - for example, jobs are created for the construction workers, subcontractors and inspectors are hired, and various services are purchased by the builder.
When? At 9:30pm Eastern Time.
Trading Tip: If the actual number is higher than the forecast, you can expect the AUD to rise.
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What is it? As head of the central bank, which controls short term interest rates, he has more influence over the nation's currency value than any other person. Traders scrutinize his public engagements as they are often used to drop subtle clues regarding future monetary policy.
When? At 8:30pm Eastern Time.
Trading Tip: If the announcement will hint towards higher interest rates, you can expect the AUD to rise.
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What is it? The rate decision is often priced in the market so it tends to be overshadowed by the FOMC Statement which is focused on the future. Short term interest rates are the paramount factor in currency valuation - traders look at most other indicators merely to predict how rates will change in the future. FOMC members vote on where to set the target rate. The individual votes are published in the FOMC statement.
When? At 2:00pm Eastern Time.
Trading Tip: If the actual number is higher than the forecast, you can expect the USD to rise.
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What is it? It's the primary tool the FOMC uses to communicate with investors about monetary policy. It contains the outcome of their vote on interest rates and other policy measures, along with commentary about the economic conditions that influenced their votes. Most importantly, it discusses the economic outlook and offers clues on the outcome of future votes.
When? At 2:00pm Eastern Time.
Trading Tip: If the announcement will hint towards higher interest rates, you can expect the USD to rise.
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1) U.S. consumer confidence deteriorated unexpectedly in July, dampening optimism over the health of the economy, industry data showed on Tuesday.
In a report, the Conference Board, a market research group, said its index of consumer confidence tumbled to 90.9 this month from a reading of 99.8 in June, whose figure was revised from a previously reported 101.4. Analysts expected the index to rise to 100.0 in July.
2) The euro pulled back from session lows against the dollar on Tuesday as data showing that U.S. consumer confidence deteriorated this month tempered expectations for higher interest rates.
3) U.S. natural gas prices extended gains from the previous session on Tuesday, as investors bet a heat wave making its way across the eastern U.S. will prompt households to ramp up their air conditioning.
4) U.S. homeownership dropped to a record low in the second quarter as more Americans opted to rent, data showed on Tuesday.
The seasonally adjusted home ownership rate fell to 63.5 percent, the lowest since the government started tracking the series, the Commerce Department said. The rate, which peaked at 69.4 percent in 2004, was 63.8 percent in the first quarter.
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Here are 4 tips for today's trading. This will help you decide where you should invest and what to look for:
Markets are calmer Tuesday as investors regain some poise following a global sell-off triggered by China's stock market crash.
1) China slide continues
Chinese markets took another step down Tuesday, but the move wasn't nearly as dramatic as Monday when the benchmark Shanghai index dropped by 8.5%, its worst performance in eight years.
On Tuesday, the Shanghai Composite closed down 1.7% after slumping as much as 4% in early trading. The Shenzhen Composite fell 2.2%.
China's regulators have taken a number of steps to prop up prices in recent weeks. Late on Monday, China's top securities regulator said it would buy more stocks in a bid to stabilize the market. But the renewed push lower on Tuesday shows officials are struggling to reduce volatility.
2) Commodities getting cheaper
Prices for crude oil, natural gas and gold are all dipping Tuesday after tumbling Monday.
"For [traders] the equation is very simple, if there is no demand in China, this spells trouble for the commodity market," said Naeem Aslam, chief market analyst at AvaTrade.
3) Global stock market overview
Outside of China, the picture is more positive.
U.S. stock futures are moving up and most European markets are rising in early trading. The U.K. economy picked up speed in the second quarter, growing by 0.7% over the first quarter, and at an annual rate of 2.6%.
On Monday, the Dow Jones industrial average fell 0.7%, the S&P 500 slid 0.6% and the Nasdaq lost 1%.
4) Earnings
There are lots of company earnings to watch this morning. Markets will hear from the likes of Ford (F), Pfizer (PFE), UPS (UPS), Jetblue Airways (JBLU) and GrubHub (GRUB) ahead of the opening bell.
After the markets close, expect reports from companies including Panera Bread (PNRA), Yelp (YELP) and Twitter (TWTR, Tech30).
BP (BP) reported results this morning that came in slightly below expectations. Its shares were edging up by about 1% in London trading, in line with the market.
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What is it? Financial confidence is a leading indicator of consumer spending, which accounts for a majority of overall economic activity. Survey of about 5,000 households which asks respondents to rate the relative level of current and future economic conditions including labor availability, business conditions, and overall economic situation.
When? At 10:00am Eastern Time.
Trading Tip: If the actual number is higher than the forecast, you can expect the USD to rise.
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