Market update: morning coffee brief
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Overnight markets were mixed with Chinese and Hong Kong markets rebounding after falling the last four out of five sessions. Market update: China in particular has been hit hard as the Shanghai Index has fallen to six month lows. Leadership came in the form of bargain hunters sifting through the rubble and picking up oversold construction and transportation sectors.
Market update: South Korea's Kospi Index fell for the fourth straight trading session to close down -3.06 or -0.17% to 1826.39.
Market update: The shift in sentiment came from comments made by Chinese Premier Wen Jiabao that China's top priority now is to stabilize growth. Spurred by weakening inflation and trade data for June earlier in the week, the focus will now be on China's Q2 GDP numbers.
Market update: It appears China's government realized swift action must be taken. A crack in the armor came last night with the announcement China is granting access to foreign hedge funds seeking out wealthy citizens as clients inside the mainland with the intent to invest overseas. Traders will be closely watching the GDP figures due out this Thursday at 22:00 EDT. China's GDP is forecast to fall to 7.6%, its worst performance since the 2008 financial crisis.
Market update: India's markets bucked the trend set by China in the previous session, only to not follow China's leadership today with the NIFTY and SENSEX both closing in the red. India appeared to be taking its cues not from China but the U.S., which gave up an early gain to end lower once again on the day. For the NIKKEI, KOSPI and S&P ASX 200 it was the fifth straight session in the red. This will be the longest losing period since May on concerns the euro zone crisis is spreading into Asian markets, greatly slowing global economies and earnings season will reflect this.
Market update: Asian markets will take their cue from the U.S. FOMC statement and market reaction today as they open for trade this evening.
Today's key economic data:
The economic calendar started out slow this week and begins to heat up today.
08:30 a.m. EDT USD Trade Balance
08:30 a.m. EDT CAD Trade Balance
02:00 p.m. EDT USD FOMC Meeting Minutes
Tentative BRL Brazilian Interest Rate Decision
09:30 p.m. EDT AUD Unemployment Rate
09:30 p.m. EDT AUD Employment Change
Tentative JPY Interest Rate Decision
01:30 a.m. EDT INR Indian Manufacturing Output (MoM)
Live Economic Calendar Powered by Forexpros - The Leading Financial Portal
Commodity Marker - Electronic Trading
| Crude oil | $85.20 | +1.29 | +1.54% |
|---|---|---|---|
| Nat Gas | $2.773 | +0.036 | +1.32% |
| RBOB-Gasoline | $2.7448 | -0.0021 | -0.08% |
| Brent Crude | $99.07 | +1.10 | +1.12% |
| Gold | $1,579.20 | -0.60 | -0.04% |
| Silver | $27.11 | +0.007 | +0.85% |
| Copper | $3.40 | +0.007 | +.021% |
| U.S. dollar index | 83.265 | -0.295 | -0.35% |
| as of 7:07 a.m. EDT |
Precious metals corner
Market update: Precious metals traded basically flat in the overnight session until the U.S. session began. Traders pushed gold and silver higher on speculation the FOMC statement, due at 2:00 p.m. EDT today, will indicate QE3 is coming soon to theaters near you, or at least that a door has cracked open for QE3.
ETF holdings
Market update: Holdings in the world's largest gold-backed ETF, the SPDR Gold Trust ( GLD , quote ) moved lower to 1,271.24 tons as of July 10 from the previous trading day.
Market update: The iShares Silver Trust ( SLV , quote ) held at 9,729.89 tons on July 10 from the previous trading day. SLV is the world's largest silver backed ETF.
Fundamental outlook
Market update: Gold and silver is likely to drift higher ahead of the pending 2 p.m. FOMC statement, but beware; if QE3 speculation is not met the metals could fall rapid as money flow continues into the U.S. dollar.
Looking at the pre-market we find:
Pre-markets are quiet today, with volume activity in the following ADRs:
TEVA TEVA PHARMACEUTICAL INDS LTD ADR
Upcoming earnings in the Emerging Money Index
| INFY | Infosys Ltd | July 12 | Before the bell |
|---|---|---|---|
| YUM | Yum! Brands Inc | July 18 | After the bell |
| TV | GRUPO TELEVISA | July 18 | Time unspecified |
| SAP | SAP AG SPON | July 19 | Before the bell |
| FMX | FORMENTO ECONOMICO MEXICANO | July 19 | Before the bell |
| RDY | DOCTOR REDDY'S LAB | July 19 | Before the bell |
| TSM | TAIWAN SEMICONDUCTOR | July 19 | Before the bell |
| HXM | HOMEX DEVELOPMENT | July 24 | After the bell |
| ITUB | ITAU UNIBANCO HOLDING | July 24 | Time unspecified |
| VALE | VALE S.A. | July 25 | Time unspecified |
| TEVA | TEVA PHARMACEUTICAL INDS LTD | July 25 | Before the bell |
| BIDU | BAIDU INC | July 25 | After the bell |
| UMC | UNITED MICROELECTRONICS | July 25 | Before the bell |
| VALE | VALE S.A | July 25 | Time unspecified |
| YNDX | YANDEX | July 26 | Before the bell |
| ERJ | EMBRAER S.A | July 26 | After the bell |
| PBR | PETROLEO BRASILEIRO | July 27 | Time unspecified |
| ABV | COMPANHIA DE BEBIDAS | July 31 | Before the bell |
| MELI | MERCADOLIBRE INC | August 1 | After the bell |
Bottom line: The European finance minsters' 'plan' has faded and all eyes are now on the U.S. Federal Reserve's statement due at 2pm EDT today, along with other key data on how the world's largest economy is doing. The euro zone is in the green as traders and fund managers move into defensive sectors, suggesting additional risk-off sentiment for the remainder of the week. Look for Asian ADRs to trade flat ahead of the FOMC. Watch WTI crude oil for precursors.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
