U.S. indices closed lower on Tuesday pressured by shares in the Semiconductors & Semiconductor Equipment (-1.71%), Capital Goods (-1.58%) and Banks (-1.49%) sectors. On the economic data front, the ISM manufacturing PMI dropped to 49.1 in August (vs. 51.3 estimated) from 51.2 in July, a fourth straight month of decline. The Markit U.S. manufacturing PMI was confirmed at 50.3 in August (vs. 50.0 expected and 49.9 preliminary). Finally, construction spending increased 0.1% MoM in July (vs. +0.3% expected). The S&P 500 (2,906.27) trades above its 20d moving average (2,896.01 – flat slope) but stays below its 50d moving average (2,944.17 – flat slope).
European markets are expected to open on a positive note.
Foreign Exchange
The US dollar was under pressure against all of its major pairs on Tuesday with the exception of the CAD. On the economic data front, Markit U.S. manufacturing PMI came in at 50.3 in Aug breaking below 2016 lows. Economists were anticipating 50 compared to 49.9 back in July. The ISM manufacturing PMI came in at 49.1 in Aug (51.3 estimate) as it continues its decline from 2018 highs vs 51.2 in the prior month. Finally, construction spending rebounded in July for a gain of 0.1% compared to a revised decline of 0.7$ in June. Analyst were anticipating a gain of 0.3%.
The Euro was bearish all of its major pairs besides the CAD. In Europe, the euro-zone PPI index increased by 0.2% in July, as expected, after a 0.6% decline a month earlier. UK PMI construction index slid to 45 in August from 45.3 in July. It was anticipated to be 46.5.
The Australian dollar pushed higher against all of its major pairs.
Commodities
After the close of Wall Street, WTI Crude Future (OCT 19) was down $1.2 to $53.94. The contract was below its 20D MA (@ $54.77) and below its 50D MA (@ $56.4).
Gold was up $16 to $1545.4. The precious metal was above its 20D MA (@ $1516) and above its 50D MA (@ $1459).
Copper Future (DEC 19) on Comex was down 2.2c to 253c/lb. The contract was below its 20D MA (@ 258.03c) and below its 50D MA (@ 264.85c). In Europe, the London Metal Exchange reported its copper inventories decreased 5800 tons to 330050 tons.