- NASDAQ Composite -0.68% Dow -0.89% S&P 500 -0.67% Russell 2000 -0.76%
- NASDAQ Advancers: 885 / Decliners: 1513
- Today's Volume (vs. Friday) -6.9%
- Crude $54.80 +$0.30, Gold $1505.00 +$8.40, VIX 19.74 +1.77
- PBOC set the yuan above 7 (7.0211) per USD for the 3rd day in a row
- China's July New Loans totaled CNY1.06 trillion (expected CNY1.275 T: last CNY1.66 T)
- Outstanding Loans grew 12.6% Y/o/Y (expected 12.8%; last 13.0%)
- July M2 Money Stock increased 8.1% yr/yr (expected 8.5%; last 8.5%)
- Saudi Aramco said today that the company is ready for its IPO with timing being a shareholder issue
- Reaction to earnings: SYY + 4%, GOLD +2%, TRWH -6%
Global volatility remains. The markets around the world saw significant swings last week, alternating between big up and down days. When it was all said and done, the S&P 500 closed down 0.45%, the Dow was down 0.75%, the Nasdaq was down 0.56% and the Russell down 1.34% for the week. Trading volumes were significant. On a daily basis, the consolidate tape averaged 8.3 billion shares a day, a 17% increase above the year-to-date average of 7.1 billion a day. Traders alternated between risk-on & risk-off sentiment in reaction to the China-U.S. trade war and emerging currency fight. What began as a rout on Monday, with U.S. stocks suffering their worst one-day drop of 2019, reversed course as Beijing played down their aggressive stance on the weakening yuan. Friday morning, President Trump dialed up the rhetoric, suggesting September’s trade meetings with China may be canceled, again adding more uncertainty to an already volatile market.
Today, we are lower again to start the week. Nothing really new on the tape, just a continued concern on the well-discussed global slowdown as well as the trade and currency concerns between the U.S. & China. M&A is getting some headlines as CBS & VIAB are close to finalizing a deal. Treasury yields continue to slide as government debt is bid up.
Ten of the 11 S&P 500 sectors are trading lower with Financials, Energy and Discretionary all down over 1% Real Estate is positive while Utilities (as a safety play) trade near-flat. Crude oil builds on Friday’s gains. Gold is up on the day, still hovering near the $1500 level. The dollar is slightly lower while the yield on the 10-yr is down to 1.659%.
Hong Kong continues to see unrest. The city’s Financial Secretary, Paul Chan, said “Hong Kong’s economy is facing a very difficult situation… it is facing very big downward pressure as it has to deal with the ongoing U.S.-China trade war and internal challenges at the same time.” Paul Chan also said “Industries like retail, catering and transportation have taken a hit because of the recent violent unrest, with significant revenue drops." Following this weekend’s violent demonstrations, most outbound flights were canceled at the Hong Kong International Airport as protesters disrupted operations. The Hang Seng Index closed down 0.44% today.
|Tuesday||6:00||NFIB Small Business Index|
|Tuesday||7:45||Retail Economist/Goldman Chain Store|
|Tuesday||8:30||CPI ex Food, Energy|
|Tuesday||8:55||Rebook Chain Store|
|Tuesday||16:30||API Crude Inventories|
|Wednesday||7:00||MBA Mortgage Purchase Applications|
|Wednesday||10:30||DOE Crude Inventories|
|Thursday||8:30||Initial Jobless Claims|
|Thursday||8:30||Philadelphia Fed Index|
|Thursday||8:30||Retail Sales ex Autos|
|Thursday||8:30||Unit Labor Costs (Preliminary)|
|Thursday||10:00||NAHB Housing Market Index|
|Thursday||10:30||EIA Natural Gas Inventories|
|Friday||10:00||Michigan Consumer Sentiment (Preliminary)|
Brian’s Technical Take
Geopolitical concerns from Hong Kong and Argentina are leading to broad declines for US equities. In the early going all eleven GICS sectors were in the red but the bond proxy REITs have turned it around and are marginally positive as rates are lower across the curve.
The S&P 500 Real Estate Index (S5RLST is having its best annual performance (+23.8% YTD) since 2014, second only to Technology (+25.6% YTD). Since the start of Q3 the real estate index is outperforming all sectors. Last week it made a bullish breakout from a seven week consolidation range to new all-time highs. Friday’s price action does have the look of a potential topping candlestick pattern (hanging man) which suggests near term consolation could take hold, but the technical setup remains constructive over the intermediate and long term.
Nasdaq's Market Intelligence Desk (MID) Team includes:
Charles Brown is Associate Vice President on The Market Intelligence Desk with over 20 years of equity capital markets experience. Charlie has extensive knowledge of equity trading on both floor and screen based marketplaces. Charlie assists with the management of The Market Intelligence Desk and works with Nasdaq listed companies providing them with insightful objective trading analysis.
Steven Brown is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq with over twenty years of experience in equities. With a focus on client retention he currently covers the Financial, Energy and Media sectors.
Christopher Dearborn is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq. Chris has over two decades of equity market experience including floor and screen based trading, corporate access, IPOs and asset allocation. Chris is responsible for providing timely, accurate and objective market and trading-related information to Nasdaq-listed companies.
Brian Joyce, CMT is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq. Before joining Nasdaq Brian spent 16 years as an institutional trader executing equity and options orders for both the buy side and sell side. He also provided trading ideas and wrote technical analysis commentary for an institutional research offering. Brian focuses on helping Nasdaq’s Financial, Healthcare and Transportation companies, among others, understand the trading in their stock. Brian is a Chartered Market Technician (CMT).
Michael Sokoll, CFA is Associate Vice President on the Market Intelligence Desk (MID) at Nasdaq with over 25 years of equity market experience. In this role, he manages a team of professionals responsible for providing NASDAQ-listed companies with real-time trading analysis and objective market information.