Daily Video Review - 14/09
- Donald Herison
- English
- MARKETS NEWS
- Hits: 1399
It’s the Fed week.
Here are 4 tips for today's trading. This will help you decide where you should invest and what to look for:
1) Markets on hold
U.S. stock futures are pointing up, but the gains are muted -- as are global markets -- as investors wait for this week's Federal Reserve meeting. European markets are narrowly firmer in early trading, and Asian markets ended mixed: Hong Kong and India advanced but stocks in Japan and China fell back.
Shares in ARM Holdings (ARMH, Tech30) -- a British company that designs the chips that power iPhones and smartphones -- are rising by about 3% in London.
2) A chill from China
Chinese markets took another tumble Monday after the release of weak industrial production and investment data. Still, economists do not expect growth to slow sharply this year -- they estimate expansion of 6.9% for 2015, very close to the official 7% target. The Shenzhen index dropped by 6.7% and the Shanghai Composite declined by 2.7%.
3) Fed countdown
Analysts and economists are eagerly awaiting the upcoming meeting of Federal Reserve members on Wednesday and Thursday. A decision on interest rates will come out Thursday and is sure to have an immediate impact on the markets.
"The decision itself is arguably more important for the markets than anything else we've seen so far in 2015," said Angus Campbell, senior analyst at FxPro.
"There is still a minority that is of the view that the [Fed] will announce a [rate] hike this Thursday, but it's hard to see how a hike now will help investors given all that the financial markets have been though in the past few weeks, in particular emerging markets."
4) Weekly market recap
The last week was generally positive and Friday ended on a high note. The Dow Jones industrial average ticked up 0.6% Friday, while the S&P 500 and the Nasdaq each gained 0.5%.
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What is it? It's among the primary tools the BOJ uses to communicate with investors about monetary policy. It contains the outcome of their decision on interest rates and commentary about the economic conditions that influenced their decision. Most importantly, it projects the economic outlook and offers clues on the outcome of future rate decisions.
When? Tentative
Trading Tip: If the announcement will hint towards higher interest rates, you can expect the JPY to rise.
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What is it? It's a detailed record of the RBA Reserve Bank Board's most recent meeting, providing in-depth insights into the economic conditions that influenced their decision on where to set interest rates.
When? At 9:30pm Eastern Time.
Trading Tip: If the announcement will hint towards higher interest rates, you can expect the AUD to rise.
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1. U.S. stocks opened lower on Friday as investors awaited a decision on rate hike by the U.S. Federal Reserve next week. The Dow Jones industrial average (DJI) fell 52.78 points, or 0.32 percent, to 16,277.62, the S&P 500 (SPX) lost 6.56 points, or 0.34 percent, to 1,945.73 and the Nasdaq composite (IXIC) dropped 24.55 points, or 0.51 percent, to 4,771.71.
2. U.S. producer prices were flat in August, pointing to benign inflation pressures that could weigh on the Federal Reserve's decision whether to hike interest rates next week.
3. Oil prices fell on Friday after Goldman Sachs (NYSE:GS) cut its crude forecasts, citing global over-supply and concerns over the health of the Chinese economy, and after Saudi Arabia dismissed the idea of an oil producer summit.
4. U.S. core producer price inflation rose more-than-expected last month, official data showed on Friday. In a report, U.S Bureau of Labor Statistics - Department of Labor said that U.S. core PPI rose to a seasonally adjusted 0.3%, from 0.3% in the preceding month. Analysts had expected U.S. core PPI to rise 0.1% last month
5. A spike higher in the offshore yuan following suspected rare intervention by Chinese state banks is expected to be short-lived, especially with a looming U.S. interest rate rise likely to add to the attraction of owning dollars.
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The week got off to a roaring start, but markets look set to end it with a whimper.
Here are 4 tips for today's trading. This will help you decide where you should invest and what to look for:
1) Happy Friday?
There's a generally negative mood in the markets right now.
U.S. stock futures are edging down and European markets are dipping in early trading. Asian markets closed with mixed results.
This comes after stock markets soared Tuesday when U.S. traders returned from the Labor Day long weekend.
2) Oil falls again
In commodities, crude oil futures are dipping by about 2% to trade around $45 per barrel. The chances of another slump in prices to near $20 per barrel are rising, Goldman Sachs said in a new report Friday. But the supply glut should ease in 2016 as OPEC's rivals -- and in particular the U.S. -- slash production, the International Energy Agency said.
3) Earnings and economics
A few companies will open their earnings books before Friday trading begins. Mattress Firm (MFRM) and Kroger (KR) are among them.
On the economic side, the U.S. Bureau of Labor Statistics will release its producer price index for August at 8:30 a.m. ET. This index is a key inflation indicator. Prices were up 0.2% in July.
Then, at 10 a.m. ET, the University of Michigan will put out September's consumer sentiment index.
4) Russian rates
Russia's central bank is set to make a decision on interest rates at around 6:30 a.m. ET. The benchmark interest rate is currently set at 11% and has come down from a recent high of 17%.
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What is it? It's a leading indicator of consumer inflation - when producers charge more for goods and services the higher costs are usually passed on to the consumer.
When? At 8:30am 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? Financial confidence is a leading indicator of consumer spending, which accounts for a majority of overall economic activity.
When? At 8:30am Eastern Time.
Trading Tip: If the actual number is higher than the forecast, you can expect the USD to rise.
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1. U.S. stocks wavered Thursday, with the Dow Jones Industrial Average struggling to maintain early gains after global shares dropped, while weak data out of China and Japan -- the world’s second and third-largest economies -- heightened concerns about slowing global growth. Stocks continued their wild roller-coaster ride Thursday, extended the previous day’s losses, where U.S. stocks plunged sharply in the final minutes of trading Wednesday, sending the Dow nearly 240 points lower by the day's end.
2. The dollar remained steady against the other major currencies on Thursday after data showing that Initial jobless claims ticked lower last week as uncertainty over whether the Federal Reserve will hike rates this month continued to weigh.
3. Brazil's financial markets fell on Thursday after Standard & Poor's cut the country's sovereign rating to junk late Wednesday, though assets began to pare losses in late morning trading as the downgrade had been largely priced in.
4. The U.S. labor market appeared to gain momentum in early September as fewer Americans filed for weekly unemployment benefits, but weak inflation pressures may complicate the Federal Reserve's decision whether to raise interest rates. The number of people who filed for unemployment assistance in the U.S. fell in line with expectations last week, remaining in territory consistent with a strengthening labor market, official data showed on Thursday.
5. U.S. stocks were little changed at the open on Thursday amid fears of slowing global growth ahead of the U.S. Federal Reserve's interest rate meeting next week. Global markets were under pressure after data showed a drop in producer prices and car sales in China and slowing capital spending in Japan.
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U.S. stocks look set to nudge higher at the open. But most markets around the world are trading in negative territory.
Here are 4 tips for today's trading. This will help you decide where you should invest and what to look for:
1) Time to settle down
Global stock markets seem to be settling down a bit after weeks of extreme volatility.
As it stands now, U.S. stock futures are pointing up, but not by much.
Most European markets are dipping in early trading. Asian markets mostly closed with losses that ranged from about 1% to 2.5%.
That may seem like a lot, but it's relatively muted compared to recent swings. Chinese Premier Li Keqiang said Thursday that the economy is "running within the proper range," and insisted Beijing would never start a currency war.
On the foreign exchange market, the Japanese yen is weakening versus most other major currencies. The Aussie dollar is strengthening.
2) Potential market mover
Apple: America's biggest company -- Apple (AAPL, Tech30) -- is still in the spotlight Thursday after unveiling a range of new products on Wednesday, including the iPhone 6S, Apple TV and iPad Pro.
Shares in the tech giant are rebounding a bit in premarket trading after declining by nearly 2% Wednesday. Be ready for higher-than-normal trading volume.
3) Earnings and economics
Lululemon (LULU) is among a small crop of companies reporting earnings before the market opens.
Zumiez (ZUMZ) and Restoration Hardware (RH) will report after the close.
The federal government will report weekly jobless claims data at 8:30 a.m. ET.
Then at 10:30 a.m. the U.S. will release new data on natural gas inventories. Information on crude oil inventories will come out at 11 a.m.
4) Wednesday market recap
The previous trading session started with gains, but ended with losses. The Dow Jones industrial average dropped 1.5%, the S&P 500 dipped 1.4% and the Nasdaq lost 1.2%.
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What is it? This is the nation's earliest economic data. The market impact fluctuates from week to week - there tends to be more focus on the release when traders need to diagnose recent developments, or when the reading is at extremes.
When? At 8:30am 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 among the primary tools the MPC 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? Tentative
Trading Tip: If the announcement will hint towards higher interest rates, you can expect the GBP to rise.
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What is it? It's among the primary tools the MPC 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? Tentative
Trading Tip: If the announcement will hint towards higher interest rates, you can expect the GBP to rise.
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What is it? When there is a change in rates the MPC will also issue a statement. The rate decision is often priced in the market so it tends to be overshadowed by the MPC Rate Statement which is focused on the future.
When? At 7:00am Eastern Time.
Trading Tip: If the actual number is higher than the forecast, you can expect the GBP to rise.
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1. Wall Street opened higher on Wednesday after China's finance ministry said the government will strengthen fiscal policy, boost infrastructure spending and speed up tax reforms.
2. Gold futures fell to the lowest level in more than three weeks on Wednesday, as a broadly stronger U.S. dollar and rallying global equity markets reduced the appeal of the precious metal.
3. The dollar pushed higher against against the other major currencies on Wednesday, amid hopes for fresh easing measures by the Bank of China. The dollar was higher against the yen, with USD/JPY up 0.92% at 120.91.
4. Global shares surged on Wednesday, led by the biggest daily gains in Japan for seven years, helping lift the dollar and oil prices as the prospect of more stimulus from China soothed investors rattled by recent market turmoil. The charge into stocks pushed yields on low-risk government bonds higher, with the rise exacerbated by the anticipation of auctions of German and U.S. 10-year debt later in the day.
5. Lockheed Martin Corp (NYSE:LMT), the maker of F-35 fighter jets, said it would cut about 500 jobs in its IT services unit by mid-November. Lockheed said the job cuts were unrelated to the strategic review the company announced in July for its government IT and technical services businesses.
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