September 5, 2019

Daily Market Review – Thursday, September 5, 2019

Daily Market Review – Thursday, September 5, 2019

Asia

British lawmakers yesterday voted to prevent Boris Johnson from exiting the EU without a deal and rejected his proposed snap elections before the Brexit date. The government must now request a 3-month delay from the EU, and the pound is back in the 1.2200-1.2250 range – erasing a week’s worth of losses. In general, European markets followed Asia and the US upwards, the CAC40 leading increases with 1.21%. Service and composite PMIs across Europe came in mainly in the green, with a slight improvement across the board, except in Italy, which saw a 1-point contraction. German factory orders declined by another 5.6% in July following June’s -3.6%, raising fears of a cross-union recession.

Europe

Asian equities pushed indexes a percent higher and the Yuan added 10 pips to the dollar on hopes of a restart in US-China trade talks next month. The Hang Seng is still about a half percent in the red despite Carrie Lam’s final expunging of her extradition bill – apparently with central Chinese government support and after Reuter’s revelation that Beijing was refusing concessions despite Lam’s pleas. Australia’s trade surplus for July narrowed to a less than expected $7.268 mn on declining exports and a 3% expansion in imports, following a 3.5% decline in the latter in June.

US

Despite China’s announcement of an agreement to hold high-level talks with the US in October, the US yesterday announced additional duties on structural steel from Mexico and China due to alleged dumping. Economic optimism based on the IBD/TIPP survey declined by 5 points in September to 50.8 MoM, although Redbook’s same-store sales growth index indicates a 1/2point improvement in August to -1%.

Commodities

Oil remains steady in the 56-56.50 band after yesterday’s miniscule inventory build (0.4mB), based on API data. Gold continues sporadically between 1550 and 1560, and bitcoin trading is now considering the 11K mark as it bounces atop $10,500, following the head of the International Money Fund’s statement that central banks should embrace cryptocurrencies.

Corporate

Corporate

Google shares barely reacted after its YouTube subsidiary was forced to pay a $170mn fine on child privacy laws by the US Federal Trade Commission, and GE added 6% as analysts begin weighing in on the corporation’s post-fraud allegations health.

Economic Calendar

Today’s Top Economic Events
TIME/PLACERELEASE/DATA
12:15 PM GMT – USAugust’s ADP Employment Change. Challenger Job Cuts, Initial & Continuing Jobless Claims, Unit Labour Costs (Q2) and Nonfarm Productivity (Q2) at 12:30. Markit Services & Composite PMI (Aug) at 13:45. ISM Non-Manufacturing PMI (Aug) and Factory Orders (Jul) at 14:00
22:30 PM GMT – AustraliaAiG Performance of Construction Index (Aug)
23:30 PM GMT – JapanLabor Cash Earnings and Overall Household Spending (Jul). Foreign Reserves (Aug) at 23:50. And Coincident & leading Economic Index (Jul) at 5:00 (+1)

For more, visit our Economic Calendar