General Market Comment
US indices closed lower on Wednesday pressured by shares in the Semiconductors & Semiconductor Equipment (-2.31%), Automobiles & Components (-2.21%), Energy (-2.15%) sectors. Crude dropped the most in 2-years. On the economic data front, MBA mortgage applications increased by 2.5% in the week ending July 6 from -0.5% in the prior week. In addition the PPI final demand MoM increased by 0.3% in June (estimated +0.2%) from +0.5% in May. Finally, wholesale inventories MoM increased by 0.6% in the final estimate in June (estimated +0.5%) from +0.5% in May. The S&P 500 (2,774.02) remains above its 20d moving average (2,750.45 – flat slope) and 50d moving average (2,731.25 – positive slope).
European markets are expected to start on a positive note.
Foreign Exchange
The US dollar was bullish against all of its pairs on Wednesday. On the economic data front, MBA mortgage applications increased by 2.5% in the week ending July 6 from -0.5% in the prior week. In addition the PPI final demand MoM increased by 0.3% in June (estimated +0.2%) from +0.5% in May. Finally, wholesale inventories MoM increased by 0.6% in the final estimate in June (estimated +0.5%) from +0.5% in May.
The Euro was also mixed against its major pairs. No major economic stat was released in Europe yesterday.
The Australian dollar was bearish against all of its major pairs.
Commodities
After the close of Wall Street, WTI Crude Future (AUG 18) was down $3.5 to $70.65. The contract was above its 20D MA (@ $70.04) and above its 50D MA (@ $69.18). The US Department of Energy reported that, for the week ended 6 July, crude oil inventories fell 12633k barrels compared to the previous week.
Gold was down $13.9 to $1241.7. The precious metal was below its 20D MA (@ $1262) and below its 50D MA (@ $1285).
Copper Future (SEP 18) on Comex was down 9.4c to 274.5c/lb. The contract was below its 20D MA (@ 299.75c) and below its 50D MA (@ 308.16c). The 14d RSI below 30 (19.28) indicates Copper Future (SEP 18) contract was oversold. In Europe, the London Metal Exchange reported its copper inventories decreased 5150 tons to 265475 tons.