General Market Comment
US indices closed mixed on Thursday. Shares in the Automobiles & Components (-3.13%), Software & Services (-2.97%) and Commercial & Professional Services (-1.66%) sectors were under pressure while shares in the Media (+2.47%), Semiconductors & Semiconductor Equipment (+1.34%) and Transportation (+1.29%) sectors gained a bit of strength. On the economic data front, wholesale inventories MoM remained unchanged in the preliminary estimate in June (estimated +0.3%) from a revised +0.4% in May. In addition, initial jobless claims increased to 217K in the week ending July 21 (estimated 215K) from a revised 208K previously. Continuing claims decreased to 1.745M in the week ending July 14 (anticipated 1.733M) from a revised 1.753M last week. In other news, durable goods orders increased in the preliminary estimate of 1% in June (estimated +3%) from -0.3% in the previous month. Finally, the Bloomberg consumer comfort index increased to 59 in the week ending July 22 from 58.8 in the prior week. The S&P 500 (2,837.44) remains above both its 20d moving average (2,783.17 – positive slope) and 50d moving average (2,759.69 – positive slope).
European markets are expected to start on a flat note.
Foreign Exchange
The US dollar was bullish against all of its major pairs on Thursday. On the economic data front, wholesale inventories MoM remained unchanged in the preliminary estimate in June (estimated +0.3%) from a revised +0.4% in May. In addition, initial jobless claims increased to 217K in the week ending July 21 (estimated 215K) from a revised 208K previously. Continuing claims decreased to 1.745M in the week ending July 14 (anticipated 1.733M) from a revised 1.753M last week. In other news, durable goods orders increased in the preliminary estimate of 1% in June (estimated +3%) from -0.3% in the previous month. Finally, the Bloomberg consumer comfort index increased to 59 in the week ending July 22 from 58.8 in the prior week.
The Euro was bearish against its major pairs with exception of the AUD and the NZD. The European Central Bank left monetary policy unchanged at its July meeting. That means a base deposit rate of -0.4%, and a quantitative easing program of 30 billion per month. The ECB will cease purchasing bonds from the end of 2018. In Germany, GfK’s consumer confidence index slightly declined to 10.6 in August from 10.7 in July and 10.7 expected. Finally, the French consumer confidence was 97 in July vs 98 expected and 97 the previous month.
The Australian dollar was bearish against all of its major pairs.
Commodities
After the close of Wall Street, WTI Crude Future (SEP 18) was about flat to $69.64. The contract was below its 20D MA (@ $69.81) and above its 50D MA (@ $68.31).
Gold was down $8.4 to $1223.2. The precious metal was below its 20D MA (@ $1241) and below its 50D MA (@ $1268).
Copper Future (SEP 18) on Comex was about flat to 280.9c/lb. The contract was below its 20D MA (@ 281.7c) and below its 50D MA (@ 300.94c). In Europe, the London Metal Exchange reported its copper inventories decreased 450 tons to 251950 tons.