General Market Comment
US indices closed mixed on Thursday. Shares in the Semiconductors & Semiconductor Equipment (-2.34%), Energy (-1.93%) and Technology Hardware & Equipment (-1.22%) sectors closed lower while shares in the Telecommunication Services (+0.73%), Capital Goods (+0.53%) and Food, Beverage & Tobacco (+0.45%) sectors gained traction. On the economic data front, ADP employment change declined to 163k jobs in August (estimated 200k) from 217k in the previous month. Also, initial jobless claims improved to 203k in week ended September 1st (forecasted 213k) compared to 213k a week earlier. Continuing claims remained relatively unchanged at 1.707M in week ended August 25th (expected 1.72M) from 1.71M the week before. In other news, the Bloomberg consumer comfort index slightly decreased to 58 in week ended September 2nd from 58.3 the week prior. The Markit US services PMI declined to 54.8 in August (estimated 55.2) compared to 55.2 in July while Markit US Composite PMI lowered to 54.7 in August vs. 55 a month earlier. Finally, factory orders decreased by 0.8% in July (forecasted -0.6%) from an increase of 0.6% in June while durable goods orders fell by 1.7% in July, in-line with estimates, from a decline of 1.7% the month prior. The S&P 500 (2,878.05) remains above its 20d moving average (2,867.25 – positive slope) and 50d moving average (2,823.88 – positive slope).
European markets are expected to open on a negative note.
Foreign Exchange
The US dollar was bearish against most of its major pairs on Thursday with the exception of the CAD and the EUR. On the economic data front, ADP employment change declined to 163k jobs in August (estimated 200k) from 217k in the previous month. Also, initial jobless claims improved to 203k in week ended September 1st (forecasted 213k) compared to 213k a week earlier. Continuing claims remained relatively unchanged at 1.707M in week ended August 25th (expected 1.72M) from 1.71M the week before. In other news, the Bloomberg consumer comfort index slightly decreased to 58 in week ended September 2nd from 58.3 the week prior. The Markit US services PMI declined to 54.8 in August (estimated 55.2) compared to 55.2 in July while Markit US Composite PMI lowered to 54.7 in August vs. 55 a month earlier. Finally, factory orders decreased by 0.8% in July (forecasted -0.6%) from an increase of 0.6% in June while durable goods orders fell by 1.7% in July, in-line with estimates, from a decline of 1.7% the month prior.
The Euro was bearish against most of its major pairs with exception of the CAD. German factory orders fell 0.9% in July after having dropped 4% the month before. Economists anticipated a 1.8% jump.
The Australian dollar was mixed with its major pairs.
Commodities
After the close of Wall Street, WTI Crude Future (OCT 18) was about flat to $68.94. The contract was above its 20D MA (@ $67.48) and above its 50D MA (@ $67.81). The US Department of Energy reported that, for the week ended 31 August, crude oil inventories fell 4302k barrels compared to the previous week.
Gold was up $6.8 to $1203.7. The precious metal was above its 20D MA (@ $1196) and below its 50D MA (@ $1218).
Copper Future (DEC 18) on Comex was up 2.4c to 263.45c/lb. The contract was below its 20D MA (@ 269.13c) and below its 50D MA (@ 277.53c). In Europe, the London Metal Exchange reported its copper inventories decreased 7750 tons to 254350 tons.