DAILY MARKET REPORT

26.08.2020

Index Last Change DJIA 28,248.44 60.02 S&P 500 3,443.62 12.34 NASDAQ 11466.47 86.75 NIKKEI 23,301.54 4.77 HANG SENG 25,488.78 2.56 DJ EURSTOXX 50 3,329.71 2.03 FTSE 100 6,037.01 67.72 CAC 40 5,008.27 0.38 DAXX 13,061.62 4.92

 US

Stock futures little changed after S&P notches another record

U.S. futures were little changed in early morning trading on Wednesday after the S&P 500 closed at a new record high.

Dow futures dipped 43 points. The S&P 500 sat just below the flatline while Nasdaq 100 futures traded in positive territory. Software company Salesforce reported blowout earnings after the bell on Tuesday. The soon-to-be Dow member rose more than 13% in extended trading after beating on the top and bottom lines of its second quarter results.

Salesforce will replace Exxon Mobil, Amgen will replace Pfizer and Honeywell International will replace Raytheon Technologies in the Dow average, S&P Dow Jones Indices said Monday. The changes are driven by Apple’s coming , which will reduce the technology weighting in the price-weighted average.

HP Enterprise, homebuilder Toll Brothers and retailer Urban Outfitters jumped after the bell following their better-than-expected earnings. On Tuesday, the Dow Jones Industrial Average lost 60 points as Apple, the gauge’s biggest influence, snapped a five-day winning streak. The tech giant closed the session down about 0.8%.

The S&P 500 gain 0.36%, to notch its 17th record close of 2020. The Nasdaq Composite also closed at a record after popping 0.76%. Shares of Facebook rose more than 3%.

China and the U.S. resumed trade talks on Tuesday. In a statement, the Office of the U.S. Trade Representative said that both sides made “progress and are committed to taking the steps necessary to ensure the success of the” phase one trade deal.

Markets were “bolstered by converts finally joining the party, by recent persistent declines in Covid cases, the halo of ongoing new treatments, and renewed progress on trade negotiations with China,” Jim Paulsen, chief investment strategist at the Leuthold Group, told CNBC.

Earnings season continues on Wednesday with Dick’s Sporting Goods, Express and Royal Bank of Canada reporting before the opening bell. Box, NetApp, Splunk and Williams- Sonoma will report after the bell on Wednesday.

Later this week, the Federal Reserve will hold its annual symposium on monetary policy. Wall Street will look for clues on further stimulus and where the economy is headed out of the event. will be looking specifically for Powell’s comments on inflation and its impact on the dollar.

 EUROPE & UK

European markets lose heading for flat open

London’s FTSE is seen opening 5 points higher at 6,042, Germany’s DAX up 9 points at 13,086, France’s CAC 40 up 4 points at 5,016 and Italy’s FTSE MIB up 43 points at 20,039, according to IG.

European are expected to open in mostly flat territory Wednesday, losing some of the positive momentum seen earlier this week.

London’s FTSE is seen opening 5 points higher at 6,042, Germany’s DAX up 9 points at 13,086, France’s CAC 40 up 4 points at 5,016 and Italy’s FTSE MIB up 43 points at 20,039, according to IG.

European stocks look set to follow their Asian counterparts in more lackluster trade Wednesday; stocks in Asia Pacific were lower in afternoon trade despite major indexes on Wall Street notching up new records yet again Tuesday.

U.S. markets were bolstered by China and the U.S. resuming trade talks on Tuesday. In a statement, the Office of the U.S. Trade Representative said that both sides made “progress and are committed to taking the steps necessary to ensure the success of the” phase one trade deal.

The moves stateside came on the back of mixed economic data, however. The U.S. Census on Tuesday reported a 36% surge in sales of newly built homes in July. The Conference Board Consumer Confidence Index, however, fell for a second straight month to 84.8 in August from July’s 91.7.

Investors are looking ahead to the Federal Reserve’s annual symposium on monetary policy Thursday, to be held in a virtual format this year. Wall Street will look for clues on further stimulus and where the economy is headed out of the event. Investors will be looking specifically for Fed Chairman Jerome Powell’s comments on inflation and its impact on the dollar.

There are no major European earnings or data releases Wednesday.

 ASIA

Asia Pacific markets lower; Alibaba’s Hong Kong shares jump after affiliate Ant Group files for listing

 Overnight on Wall Street, the S&P 500 and Nasdaq Composite rose to all-time highs.  In corporate developments, Chinese tech giant Alibaba’s affiliate Ant Group on Tuesday filed for a concurrent listing on the Shanghai ’s STAR market — a Nasdaq-style tech board — and the Hong Kong stock exchange. Hong Kong-listed shares of Alibaba jumped 3.57% by the afternoon.

Stocks in Asia Pacific were lower in Wednesday afternoon trade as major indexes on Wall Street notched new records yet again overnight.

Mainland Chinese stocks fell by the afternoon, with the Shanghai composite down about 1.1% while the Shenzhen component declined 1.515%. Hong Kong’s Hang Seng index dipped 0.21%.

In Japan, the Nikkei 225 was 0.18% lower while the Topix index shed 0.21%. South Korea’s Kospi declined 0.24%.

Meanwhile, Australia’s S&P/ASX 200 fell 0.87%.

Over in New Zealand, the S&P/NZX 50 hovered above the flatline. Trading on the country’s stock exchange was halted earlier on Wednesday following a potential second cyber attack, Reuters reported citing the NZX.

Overall, the MSCI Asia ex-Japan index was 0.22% lower.

In corporate developments, Chinese tech giant Alibaba’s affiliate Ant Group on Tuesday filed for a concurrent listing on the Shanghai Stock Exchange’s STAR market — a Nasdaq-style tech board — and the Hong Kong stock exchange. Hong Kong-listed shares of Alibaba jumped 3.57% by the afternoon.

Ant Group, which runs the highly popular Alipay mobile payments app in China, has not disclosed details about the pricing of its shares.

Overnight on Wall Street, the S&P 500 and Nasdaq Composite rose to all-time highs. The broader market index added 0.4% to close at 3,443.62 while the tech-heavy Nasdaq gained 0.8% to end its trading day at 11,466.47. The Dow Jones Industrial Average lagged as it declined 60.02 points, or 0.2%, to close at 28,248.44 — snapping a three-day winning streak.

The moves stateside came on the back of mixed economic data. U.S. Census on Tuesday reported a 36% surge in sales of newly built homes in July. The Conference Board Consumer Confidence Index, however, fell for a second straight month to 84.8 in August from July’s 91.7.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 93.103 from levels above 93.2 seen earlier in the trading week.

The Japanese yen traded at 106.43 per dollar after seeing an earlier high of 106.32 against the greenback. The Australian dollar changed hands at $0.7192, in a trading week that has seen in mostly trading between $0.716 and $0.72.

Oil prices were mixed in the afternoon of Asia trading hours, with international benchmark Brent crude futures up 0.33% to $46.01 per barrel. U.S. crude futures were flat at $43.35 per barrel.

Economic Release

 Europe and UK

Event Survey Prior EUR : GERMAN GDP -10.1% -2.2% EUR : GERMAN IFO 92.1 90.5

 US and Canada

Event Survey Prior

US: REDBOOK - 2.8% US : NEW HOME SALES 786K 776K FOMC DALY SPEAKS - -

DOMESTIC MARKET

Stocks Last Close Change Volume

SOLIDERE A 14.02 14.01 0.01 35547 SOLIDERE B 14 14 0.00 3309 HOLCIM 12.1 12.1 0.00 0 BLOM GDR 1.3 1.3 0.00 4500 BLOM BANK 2.81 2.81 0.00 0 AUDI GDR 0.36 0.35 0.01 64596 AUDI 0.98 1 2.00 33822 BYBLOS GDR 70 #N/A N/A #N/A N/A 0 BYBLOS BANK 0.39 0.39 0.00 1840

FOREIGN EXCHANGE

Currencies BID ASK EUR/USD 1.1805 1.1820 GBP/USD 1.313 1.3150 USD/JPY 106.40 106.60 USD/CAD 1.3180 1.3205 USD/LBP 1510 1520 USD/CHF 0.91 0.9125

Commodities Spot Closing GOLD 1918.45 1928.18 SILVER 26.2188 26.5342 CRUDE OIL 43.34 43.35

Market Summary

Commodities

Brent rises on U.S. output cuts ahead of biggest storm threat in 15 years

 Brent crude oil futures added 8 cents, or 0.2%, to $45.94 a barrel by 0134 GMT.  U.S. West Texas Intermediate crude was down 2 cents, or 0.1%, at $43.33 a barrel.

The price of Brent crude oil edged higher on Wednesday, lifted by U.S. producers shutting most of their offshore output in the Gulf of Mexico ahead of Hurricane Laura and optimism over China-U.S. trade talks.

But gains were capped amid renewed concern over the coronavirus pandemic, which has squeezed fuel demand, after reports from Europe and Asia of patients being re- infected with Covid-19, raising concerns about future immunity.

Brent crude oil futures added 8 cents, or 0.2%, to $45.94 a barrel by 0134 GMT, while U.S. West Texas Intermediate crude was down 2 cents, or 0.1%, at $43.33 a barrel. Both benchmarks settled at a five-month high on Tuesday.

“Crude oil prices gained, dragged higher by surging gasoline futures as Hurricane Laura heads towards the U.S. Gulf Coast,” ANZ analysts said in a note on Wednesday.

The U.S. energy industry on Tuesday was preparing for a major hurricane strike. Producers evacuated 310 offshore facilities and shut 1.56 million barrels per day of crude output, 84% of Gulf of Mexico’s offshore production – near the 90% outage that Hurricane Katrina brought 15 years ago.

“Markets are currently pricing in a possible near-term catastrophic gasoline shortage,” said Stephen Innes, chief global markets strategist at AxiCorp.

Top U.S. and Chinese officials reaffirmed their commitment to a phase one trade deal, which has seen China lagging on its obligations to buy American goods, potentially boosting flows between the world’s two largest oil consumers.

Further price support came from data from the American Petroleum Institute showing U.S. crude oil stockpiles fell more than expected last week. The U.S. Energy

Information Administration, the statistical arm of the Department of Energy, will release its own official inventory data later on Wednesday.

Still, downward pressure came from concern about demand after data showing U.S. consumer confidence has tumbled to its lowest in more than six years due to concern about coronavirus-induced job losses.

Gold flat as growth risks offset trade hopes; Powell speech in focus

 Spot gold was flat at $1,928.35 per ounce by 0306 GMT.  U.S. gold futures rose 0.6% to $1,934.70.  Top U.S. and Chinese trade officials reaffirmed their commitment to a phase one trade deal, which has seen China lagging on its obligations to buy American goods, giving a boost to stock markets.

Gold was little changed on Wednesday, as worries over global economic outlook offset pressure from signs of progress in U.S.-China trade negotiations, while investors await a speech from U.S. Federal Reserve Chairman Jerome Powell.

Spot gold was flat at $1,928.35 per ounce by 0306 GMT. U.S. gold futures rose 0.6% to $1,934.70.

“All eyes are on what Powell says this week... there are still a lot of concerns about the economy and they continue to indicate that rates are going be low and stimulus measures will continue, which should boost gold,” said ANZ analyst Daniel Hynes.

“The U.S.-China trade news overnight that the tensions have eased slightly has dulled investors appetite for safe-havens a bit but obviously there is a lot of water to go under that bridge.”

Adding to concerns, a survey from the Conference Board showed U.S. consumer confidence unexpectedly fell in August to hit a six-year low.

Markets now await Powell’s speech at Jackson Hole on Thursday, which is expected to provide further clarity on the U.S. central bank’s view on inflation and monetary policy.

The Fed has slashed interest rates near zero and has rolled out a wave of stimulus measures to help the virus-hit economy, driving investors towards the safe-haven metal as it is viewed a hedge against inflation and currency debasement fears.

“Gold prices have found strong support at around $1,910,” said DailyFx strategist Margaret Yang.

“The mid-to--term prospect for gold remains bullish, given the presidential election, U.S.-China trade frictions risks and ultra-loose monetary conditions.”

Top U.S. and Chinese trade officials reaffirmed their commitment to a phase one trade deal, which has seen China lagging on its obligations to buy American goods, giving a boost to stock markets.

Elsewhere, silver fell 0.3% to $26.35 per ounce, platinum eased 0.1% to $926, and palladium slipped 0.7% to $2,149.97.

FX

Dollar drifts ahead of key Fed speech as economic worries grow

 The greenback took a hit after data on Tuesday showed U.S. consumer confidence tumbled to the lowest in more than six years due to concerns about coronavirus-induced job losses.  Traders will look to Powell’s speech on Thursday at the annual Jackson Hole retreat to determine what steps the Fed is willing to take to safeguard a fragile economic recovery.  Against the euro, the dollar stood at $1.1816 on Wednesday following a 0.4% decline in the previous session. The British pound bought $1.3138 having risen 0.7% against the dollar on Tuesday.

The dollar held steady against most currencies on Wednesday as traders braced for U.S. data expected to show a slowdown in durable goods orders and a key speech by Federal Reserve Chairman Jerome Powell.

The yuan rose toward a seven-month high after U.S. and Chinese trade officials reaffirmed their commitment to a phase one trade deal, which eased concerns about a diplomatic standoff between the world’s two-largest economies.

The greenback took a hit after data on Tuesday showed U.S. consumer confidence tumbled to the lowest in more than six years due to concerns about coronavirus-induced job losses.

Traders will look to Powell’s speech on Thursday at the annual Jackson Hole retreat to determine what steps the Fed is willing to take to safeguard a fragile economic recovery.

“I expect Powell to use forward guidance to send a dovish message that rates will remain low for a long time, which feeds into dollar weakness,” said Minori Uchida, head of global market research at MUFG Bank in Tokyo.

“You could say we are in a long-term correction of excessive dollar strength.”

Against the euro, the dollar stood at $1.1816 on Wednesday following a 0.4% decline in the previous session.

The British pound bought $1.3138 having risen 0.7% against the dollar on Tuesday.

Sterling has managed to shrug off a lack of progress in trade negotiations between Britain and the European Union.

The dollar bought 0.9090 Swiss franc, close to the lowest in more than five years against the safe harbor currency.

The dollar was locked into a narrow range against the yen, last trading at 106.43.

Powell’s speech at Jackson Hole – held online due to the coronavirus outbreak – is by far the biggest event of the week, but the data calendar leading up to Thursday has been discouraging.

Data later on Wednesday is forecast to show growth in U.S. durable goods orders slowed in July, following from the U.S. consumer confidence report for August, which fell to the lowest since May 2014 – highlighting policymakers’ concerns about the economy.

The onshore yuan rose to 6.9002 per dollar, approaching a seven-month high after Washington and Beijing affirmed their trade deal.

The mood also brightened after Ant Group, Alibaba’s fintech arm and China’s dominant mobile payments firm, filed for a dual listing in Hong Kong and Shanghai to raise as much as $30 billion in what would be the world’s largest initial .

The Australian dollar was little changed at $0.7195 as traders monitor a coronavirus outbreak in the state of Victoria.

The New Zealand dollar last bought $0.6552.

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