General Market Comment

General Market Comment

US indices closed lower on Tuesday, pressured by shares in the Consumer Durables & Apparel (-1.43%), Telecommunication Services (-1.12%) and Pharmaceuticals, Biotechnology & Life Sciences (-0.95%) sectors. On the economic data front, Markit US manufacturing PMI improved to 54.7 in August (estimated 54.5) from 55.3 in July. In other news, construction spending increased by 0.1% MoM in July (expected 0.4%) compared to a decline of 0.8% in June. Finally, the ISM manufacturing index rose to 61.3 in August (estimated 57.6) from 58.1 in July. The S&P 500 (2,896.72) remains above its 20d moving average (2,864.76 – positive slope) and 50d moving average (2,817.35 – positive slope).

European markets are expected to start on a negative note.

Foreign Exchange

The US dollar was bullish against all of its major pairs on Tuesday. On the economic data front, Markit US manufacturing PMI improved to 54.7 in August (estimated 54.5) from 55.3 in July. In other news, construction spending increased by 0.1% MoM in July (expected 0.4%) compared to a decline of 0.8% in June. Finally, the ISM manufacturing index rose to 61.3 in August (estimated 57.6) from 58.1 in July.

The Euro was bullish against most of its major pairs with exception of the HKD, the GBP and the USD. Euro zone PPI was up by 0.4% in July, at the same pace than in June. They were anticipated to slide by 0.3%. UK PMI construction index fell to 52.9 in August from 55.8 a month earlier. Consensus expected 54.9.

The Australian dollar was lower than most of its major pairs with the exception of the NZD, the CAD and the CHF.

Commodities

After the close of Wall Street, WTI Crude Future (OCT 18) was about flat to $69.33. The contract was above its 20D MA (@ $67.35) and above its 50D MA (@ $67.75).

Gold was down $9.1 to $1191.9. The precious metal was below its 20D MA (@ $1197) and below its 50D MA (@ $1220).

Copper Future (DEC 18) on Comex was down 6.9c to 260.15c/lb. The contract was below its 20D MA (@ 270.62c) and below its 50D MA (@ 279.19c). In Europe, the London Metal Exchange reported its copper inventories increased 425 tons to 262900 tons.