U.S. indices closed mixed to end the week on Friday. Shares in the Semiconductors & Semiconductor Equipment (+0.73%), Materials (+0.67%) and Banks (+0.61%) sectors moved higher while shares in the Household & Personal Products (-0.8%), Retailing (-0.63%) and Consumer Services (-0.63%) sectors were under pressure. On the economic data front, U.S. personal spending increased 0.6% MoM in July (vs. +0.5% estimated), while personal income grew 0.1% (vs. +0.3% estimated). The MNI Chicago PMI rose to 50.4 in August (vs. 47.5 estimated) from 44.4 in July. The final readings of University of Michigan Consumer Sentiment Index posted 89.8 in August (vs. 92.1 previously), the lowest level since October 2016. U.S. indices wrapped up the week with the biggest weekly gains since June amid trade tensions and recession fears. The S&P 500 (2,928.46) trades above its 20d moving average (2,892.93 – flat slope) but stays below its 50d moving average (2,945.05 – flat slope).
European markets are expected to start on a flat note.
Foreign Exchange
The US dollar was higher against all of its major pairs on Friday with the exception of the JPY. On the economic data front, U.S. personal spending increased 0.6% in July above the 0.5% estimate compared to 0.3% in June however personal income grew 0.1%, below the 0.3% estimate and below the June’s revised 0.5% increase. The U.S. August MNI Chicago business barometer index rose to 50.4 , above the 47.5 estimate and July’s 44.4 reading. Finally, the University of Michigan Consumer Sentiment Index fell to 89.8 in August from a previously reported 92.1 in July, a level not seen since October 2016 as trade fears and the effect on the economy concern Americans.
The Euro declined sharply against all its major pairs as it sank below $1.10 against the USD for the first time since May 2017. In Europe, euro-zone annual inflation is expected to be 1% in August, as anticipated and stable compared to July. Separately, the euro-zone unemployment rate was 7.5% in July, as expected. According to Nationwide, UK house prices increased 0.6% in August (+0.7% expected) after a 0.3% rise in the prior month.
The Australian dollar was higher against all of its major pairs with the exception of the JPY and USD.
Commodities
After the close of Wall Street, WTI Crude Future (OCT 19) was down $1.7 to $55.05. The contract was above its 20D MA (@ $54.8) and below its 50D MA (@ $56.47).
Gold was down $4 to $1523.7. The precious metal was above its 20D MA (@ $1509) and above its 50D MA (@ $1454).
Copper Future (DEC 19) on Comex was down 2.1c to 255.65c/lb. The contract was below its 20D MA (@ 258.17c) and below its 50D MA (@ 265.21c). In Europe, the London Metal Exchange reported its copper inventories increased 1100 tons to 337675 tons.