Last Change Nasdaq Futures Fall More Than 1% As Stocks Try to Round Out

DAILY MARKET REPORT

30.07.2021

Index Last Change DJIA 35,084.53 153.60 S&P 500 4,419.15 18.51 NASDAQ 14778.26 15.68 NIKKEI 27,283.59 498.83 HANG SENG 25,810.55 504.77 DJ EURSTOXX 50 4,116.77 13.74 FTSE 100 7,078.42 61.79 CAC 40 6,633.77 24.46 DAXX 15,640.47 70.11

 US

Nasdaq futures fall more than 1% as stocks try to round out strong July

Futures contracts tied to the major U.S. stock indexes fell in the overnight session as a soft earnings report from Amazon threatened to dampen an otherwise strong month ahead of July’s final day of trading.

S&P 500 futures shed 0.77%, while those tied to the Nasdaq 100 fell 1.33%. Dow futures dipped 112 points.

The week’s deluge of earnings reports continued after the closing bell Thursday, with e- commerce giant Amazon and social media platform Pinterest providing profit updates to investors.

Amazon equity sank 7.4% in extended trading after it reported its first quarterly revenue miss in three years and gave weaker guidance. The move in Amazon’s stock helped weigh on Nasdaq 100 futures. Pinterest fell even further, down 19%, after saying it lost monthly users during the three months ended June 30.

Shares of online brokerage Robinhood started trading on the Nasdaq at $38 per share on Thursday, but the stock eventually closed its debut session more than 8% lower $34.82 per share.

Equities rallied during Thursday’s regular session even after the Commerce Department said economic growth in the U.S. decelerated somewhat in the second quarter.

The Dow Jones Industrial Average gained about 150 points on Thursday after reaching a new intraday high. The S&P 500, which also briefly touched an all-time high, finished the day up 0.4% at 4,419.15.

The tech-heavy Nasdaq Composite underperformed with a 0.1% gain, kept in check by a 4% drop in Facebook shares after the social media company’s earnings report.

 EUROPE & UK

European stocks open lower with investors monitoring earnings, new data

 Earnings continue to take center stage in Europe with BNP Paribas, Renault, Air France- KLM and IAG among the big names reporting Friday.

 On the data front, initial flash estimates for euro zone harmonized inflation in July are due at 10 a.m. London time, along with second-quarter preliminary GDP estimates

The pan-European Euro Stoxx 600 index was lower by roughly 0.8% in early deals, with mining and tech stocks leading the losses.

Shares in Asia-Pacific declined again on Friday, heading for their worst month since March 2020, as volatile trading continued for Chinese tech stocks and Hong Kong’s Hang Seng index tumbled.

Stateside, stock futures are pointing to a lower open on Wall Street, with futures contracts on the Nasdaq 100 falling sharply after e-commerce behemoth Amazon’s first earnings miss for three years.

Earnings in focus Back in Europe, earnings continue to take center stage with BNP Paribas, Renault, Air France-KLM and IAG among the big names reporting Friday.

BNP Paribas reported a 26% annual rise in net profit for the second quarter to 2.9 billion euros ($3.44 billion), exceeding market expectations on the back of a rebound in business activity.

Renault posted a quarterly net profit of 354 million euros for the first half of the year, up from a substantial loss of nearly 7.3 billion euros for the same period last year as the pandemic shut down production across the industry. The French automaker forecast a full-year profit in 2021 despite the challenges caused by the global semiconductor shortage.

L’Oréal on Thursday reported an acceleration in second-quarter sales growth in part due to a surge in U.S. makeup sales as lockdowns eased.

On the data front, initial flash estimates for euro zone harmonized inflation in July are due at 10 a.m. London time, along with second-quarter preliminary GDP estimates.

German annual consumer price inflation spiked to 3.1% in July, its highest since August 2008, prompting a leading services sector trade union to call for immediate and substantial wage increases.

 ASIA

Hong Kong’s Hang Seng tumbles more than 2% as tech shares decline; Asia- Pacific markets dip

 U.S. stocks rallied despite data showing second-quarter gross domestic product rose less than expected.  Investors will be watching how Chinese stocks end a week of volatile trading.

SINGAPORE — Volatile trading continued for Chinese stocks on Friday, as losses were seen again — a day after they clawed back some gains following a dive early this week.

Hong Kong’s Hang Seng index tumbled more than 2% by the afternoon. Declines were seen in tech stocks after they had jumped on Thursday. Alibaba tumbled 5.5%, Tencent was down 4%, and Meituan dived more than 8%. The Hang Seng Tech index overall lost more than 4%.

Hong Kong’s Hang Seng index plunged more than 8% in two days early this week, and bounced back by 3% in Thursday’s session.

Mainland-listed stocks were also subdued, with the CSI 300 tumbling 1%, Shanghai composite declining 0.53%, and the Shenzhen component down 0.48%.

The yuan, however, recovered strongly, after selling off earlier this week, tracking the stock losses. The offshore yuan was at 6.4599 on Friday morning, after weakening to around 6.52 levels earlier this week.

Japan leads losses in other Asia-Pacific markets Japan’s Nikkei 225 dipped 1.54% by the afternoon, while the Topix lost more than 1%.

Reuters reported the country’s industrial output jumped 6.2% in June, sharply rising from a 6.5% drop in May. June retail sales rose 0.1% from a year earlier, less than forecasts for a 0.2% gain.

South Korea’s Kospi was down around 1%.

The S&P/ASX 200 in Australia was just above the flatline. Markets will be tracking the Covid situation in Sydney, which reported a record daily rise in Covid cases Thursday despite an

extended lockdown. Reuters reported that authorities have requested help from the military in enforcing the lockdown.

Meanwhile, National Australia Bank said it would buy back $2.5 billion Australian dollars ($1.85 billion) in shares, according to Reuters. Its stock was up around 0.9%.

MSCI’s broadest index of Asia-Pacific shares outside Japan lost more than 1%.

Stocks rallied stateside during Thursday’s regular session even though data showed U.S. second-quarter GDP rose 6.5% on an annualized basis, considerably less than the 8.4% Dow Jones estimate.

“Yesterday’s rebound in Chinese equities after the recent regulatory induced sell-off provided a positive lead to the solid performance in risk asset overnight,” said Rodrigo Catril, senior FX strategist at National Australia Bank.

Currencies and oil The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 91.968, dropping from levels above 92 the day before.

The Japanese yen traded at 109.50 per dollar, strengthening slightly from levels above 109.9 earlier in the week. The Australian dollar changed hands at $0.7389, after a dip earlier in the week to around $0.735.

Oil prices dipped in the morning of Asia trading hours, with Brent crude futures down 0.54% to $75.64 per barrel. U.S. crude futures were lower by 0.58% to $73.19 per barrel.

Economic Release

 Europe and UK

Event Survey Prior EUR : FRENCH CPI 1.2% 1.5% EUR: FRENCH GDP 0.9% 0.1%

 US and Canada

Event Survey Prior

US: PERSONAL SPENDING 0.7% 0.9% US: CHICAGO PMI 64.6 66.1

DOMESTIC MARKET

Stocks Last Close Change Volume

SOLIDERE A 29.1 29.22 0.12 2000 SOLIDERE B 29 29 0.00 0 HOLCIM 19.5 19.5 0.00 0 BLOM GDR #N/A N/A #N/A N/A #N/A N/A 0 BLOM BANK 3.2 3.2 0.00 0 AUDI 2.12 2.12 0.0 0 BYBLOS BK 0.94 0.94 0.00 0

FOREIGN EXCHANGE

Currencies BID ASK EUR/USD 1.187 1.189 GBP/USD 1.395 1.397 USD/JPY 109.2 109.5 USD/CAD 1.243 1.245 USD/LBP 1510 1520 USD/CHF 0.906 0.91

Commodities Spot Closing GOLD 1829.79 1828.17 SILVER 25.5799 25.5144 CRUDE OIL 73.15 73.62

Market Summary

Commodities

Gold set for biggest weekly gain in over 2 months on dovish Fed stance

 B r Gold prices helde near a two-week high on Friday, and were set for their biggest weekly gain in more than ntwo months, on renewed signs that the U.S. Federal Reserve may not taper economic supportt and hike interest rates in the near term. c Spot gold wasr steady at $1,827.70 per ounce, as of 0053 GMT, after having hit its highest since July 15 uat $1832.40 on Thursday. Bullion was on track for its biggest weekly gain since May 21, havingd risen 1.5% so far. e U.S. gold futuresf eased 0.2% to $1,827.70 per ounce. u t The dollar index was steady at a one-month low hit in the previous session, after the U.S. u central bank said the job market still had “some ground to cover” before it would pull back r on monetary estimulus. s A weaker dollarr makes gold cheaper for holders of other currencies. o Data on Thursdays showed the U.S. economy grew solidly in the second quarter, but fell short of analystse expectations. 1 Holdings in the5 SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.6% to 1,031.46c tons on Thursday, marking the first inflow in about a month. e Gold prices willn average a little above their current level of $1,830 an ounce for the remainder of t2021 before edging lower next year as the global economy recovers and central bankss begin to tighten monetary policy, a Reuters poll showed on Thursday. , Another poll showedo that analysts revised up their forecasts for palladium, with a chronic shortage of ther metal used to reduce harmful engine emissions expected to keep prices close to record0 levels. . 2

% , t o $

Silver dipped 0.3% to $25.46 per ounce, palladium rose 0.4% to $2,655.21, while platinum fell 0.7% to $1,053.47

OIL

Oil falls but heads for strong weekly gain on demand growth

 Brent crude futures fell 40 cents, or 0.5%, to $75.65 a barrel by 0151 GMT, following a 1.75% jump on Thursday.  U.S. West Texas Intermediate (WTI) crude futures fell 38 cents, or 0.5%, to $73.24 a barrel, whittling down a 1.7% rise from Thursday.

Oil prices fell on Friday but were on track to post solid gains for the week with demand growing faster than supply, while vaccinations dampen the impact of a resurgence in coronavirus cases worldwide.

Brent crude futures fell 40 cents, or 0.5%, to $75.65 a barrel by 0151 GMT, following a 1.75% jump on Thursday. U.S. West Texas Intermediate (WTI) crude futures fell 38 cents, or 0.5%, to $73.24 a barrel, whittling down a 1.7% rise from Thursday.

Both benchmark contracts were headed for gains of around 2% for the week, buoyed by indications of tight crude supplies and strong demand in the United States, the world’s biggest oil consumer.

“We’ve got stronger prices for a bit longer now, because it’s a fundamental supply-demand issue in terms of the recovery in demand we’re seeing in places like the United States,” said Justin Smirk, senior economist at Westpac.

U.S. crude and gasoline inventories fell sharply in the latest week, with crude stocks at Cushing at their lowest since January 2020, reflecting strong demand growth. ANZ analysts noted even jet fuel consumption in the country had hit its highest level since March 2020.

Even with coronavirus cases rising in the United States, all around Asia and parts of Europe, analysts said rising vaccination rates would limit the need for the harsh lockdowns that gutted demand during the peak of the pandemic last year.

“I think the risks of the large shutdowns we saw last year are much lower,” Smirk said.

Analysts point to a rapid rebound in India’s gasoline consumption and industrial production following its Covid-19 surge earlier this year as a sign that economies are more resilient to the pandemic.

“Yes, delta is a risk, but is it going to derail demand growth in the second half? We may not see that,” said Commonwealth Bank commodities analyst Vivek Dhar.

Dollar near one-month low and set for worst weekly showing since May

 The dollar index was last at 91.91 after going as low as 91.855 on Thursday, a level not seen since June 29.  The dollar held near a two-week low against the safe haven Japanese yen at 109.45 while the euro climbed to a one-month high against the dollar to be last at $1.1886.

The dollar languished near a one-month low on Friday and was poised for its worst weekly performance since May as dovish remarks by the U.S. Federal Reserve together with underwhelming economic data took the steam out of a month-long rally.

The dollar index, which measures the greenback against a basket of six other currencies, was last at 91.91 after going as low as 91.855 on Thursday, a level not seen since June 29.

For the week, the index is off 1%, its worst weekly showing since early May. For the month, the index is down 0.5% so far following a 2.8% rally in June.

The dollar’s downtrend began after Fed Chairman Jerome Powell wrongfooted bulls after a policy meeting this week by saying that rate increases were “a ways away” and the job market still had “some ground to cover.”

“While the Fed continued to say it was moving towards winding back its money printing program, the Fed’s move towards this shift looks likely to be slower than previously anticipated,” said Steven Dooley, currency strategist at Western Union Business Solutions.

“The Fed’s caution is seen due to a slowdown in U.S. growth, easing in inflation and worries about the delta variant,” Dooley added.

The dollar found little support overnight from U.S. gross domestic product numbers.

While the U.S. economy expanded at a 6.5% annualized rate in the second quarter, boosted by massive government aid, growth fell short of economists’ expectations for an 8.5% acceleration.

The dollar held near a two-week low against the safe haven Japanese yen at 109.45.

The euro climbed to a one-month high against the dollar to be last at $1.1886 ahead of preliminary second quarter gross domestic product data for France, Germany, Italy and the euro area as well as preliminary July CPI prints for France, Italy and the euro area. The euro area also gets June unemployment data.

Elsewhere, the Chinese yuan has recovered most of its Tuesday plunge, though it traded slightly on the back foot ahead of the open of onshore markets, at 6.4628 per dollar.

Sentiment was helped by China’s attempt to calm frayed investor nerves by telling foreign brokerages not to “overinterpret” its latest regulatory actions.

Both the Australian and New Zealand dollars, reliant on world and Chinese economic growth, hovered near two-week highs.

The British pound hovered near its highest in over a month helped by the U.S. dollar’s weaker tone and a fall in coronavirus cases in Britain.

Investors will keep a close eye on a bunch of U.S. macro indicators due later in the day including second-quarter employment cost index, personal income and spending for June and the University of Michigan consumer sentiment index for July.

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