U.S. indices pushed higher on Wednesday with the DOW posting its first six-day winning streak since June helped by stocks in the Technology Hardware & Equipment (+2.63%), Telecommunication Services (+2.03%) and Semiconductors & Semiconductor Equipment (+1.37%) sectors. On the economic data front, PPI rose 1.8% YoY in August (vs. +1.7% expected and in July). Wholesale Inventories grew 0.2% MoM in July (as expected). Looking at Thursday’s calendar, August CPI is expected to increase 1.8% YoY compared to 1.8% in July. Jobless Claims for the week ending September 7 are expected to be 220K according to Bloomberg, up 3K from the prior week. The S&P 500 (3,000.93) trades above its 20d moving average (2,916.98 – positive slope) and its 50d moving average (2,949.04 – flat slope).
U.S. Treasury yields rose for a third day, following those in the euro zone bond market. The euro weakened to a one-week low against the dollar ahead of Thursday’s ECB meeting which comes ahead of next week’s policy meeting by the U.S. Federal Reserve. The Fed is still expected to cut interest rates amid improving U.S. economic data. U.S. President Donald Trump pushed the Fed to cut interest rates to zero or into negative territory in a pair of Twitter posts on Wednesday.
European markets are expected to start on a positive.
Foreign Exchange
The US dollar was bullish against all of its major pairs on Wednesday. On the economic data front, MBA US Mortgage Applications increased 2.0% for the week ending September 6th compared to a decline of 3.1% in the prior week. US PPI Final Demand increased 0.1% in August from a 0.2% increase in July. US Wholesale Inventories remained unchanged in July at 0.2%. Looking at Thursday’s calendar, U.S. August CPI is expected to increase 0.1% compared to 0.3% in July. US Jobless Claims for the week ending September 7 are expected to be 220K according to Bloomberg, up 3K from the prior week.
The Euro was bearish against all of its major pairs. In Europe, there was no economic data released on Wednesday.
The Australian dollar was bullish against its major pairs.
Commodities
After the close of Wall Street, WTI Crude Future (OCT 19) was down $1.5 to $55.95. The contract was above its 20D MA (@ $55.62) and below its 50D MA (@ $56.18). The US Department of Energy reported that, for the week ended 6 September, crude oil inventories fell 6912k barrels compared to the previous week.
Gold was about flat to $1495.4. The precious metal was below its 20D MA (@ $1517) and above its 50D MA (@ $1473).
Copper Future (DEC 19) on Comex was down 1.1c to 261.65c/lb. The contract was above its 20D MA (@ 258.79c) and below its 50D MA (@ 263.72c). In Europe, the London Metal Exchange reported its copper inventories decreased 5225 tons to 305225 tons.