General Market Comment
US indices closed mixed on Tuesday. Shares in the Consumer Durables & Apparel (-1.91%), Media (-1.34%) and Transportation (-1.23%) sectors closed lower while shares in the Pharmaceuticals, Biotechnology & Life Sciences (+1.77%), Telecommunication Services (+1.76%) and Energy (+1.31%) sectors gained momentum. On the economic data front, the FHFA house price index increased by 0.2% in May, below the estimate of +0.3%, from +0.2% in April. In addition, Markit manufacturing PMI increased at a preliminary estimate of 55.5 in July (estimated 55.1) from 55.4 in June while Markit service PMI decreased at a preliminary estimate of 56.2 in July (estimated 56.3) from 56.5 in the previous month. Finally, Richmond Fed’s manufacturing survey increased to 20 in July (estimated 18) compared to a revised 21 from the prior month. The S&P 500 (2,820.40) remains above both its 20d moving average (2,770.13 – positive slope) and 50d moving average (2,754.86 – positive slope).
European markets are expected to open on a positive note.
Foreign Exchange
The US dollar was bearish against its major pairs on Tuesday with exception of the CHF and the EUR. On the economic data front, the FHFA house price index increased by 0.2% in May, below the estimate of +0.3%, from +0.2% in April. In addition, Markit manufacturing PMI increased at a preliminary estimate of 55.5 in July (estimated 55.1) from 55.4 in June while Markit service PMI decreased at a preliminary estimate of 56.2 in July (estimated 56.3) from 56.5 in the previous month. Finally, Richmond Fed’s manufacturing survey increased to 20 in July (estimated 18) compared to a revised 21 from the prior month.
The Euro was bearish against its major pairs with exception of the CHF. In the UK, retail sales in June were down by 0.5% in May (expected +0.2%) vs. +1.3% in the previous month.
The Australian dollar was bullish against all of its major pairs.
Commodities
After the close of Wall Street, WTI Crude Future (SEP 18) was up $0.6 to $68.51. The contract was below its 20D MA (@ $69.89) and above its 50D MA (@ $68.36).
Gold was about flat to $1225.1. The precious metal was below its 20D MA (@ $1243) and below its 50D MA (@ $1271).
Copper Future (SEP 18) on Comex was up 5.6c to 280.2c/lb. The contract was below its 20D MA (@ 283.64c) and below its 50D MA (@ 302.05c). In Europe, the London Metal Exchange reported its copper inventories decreased 275 tons to 254425 tons.