On 10 July, 2017 – Most stock indices advanced as investors waited for key Fed Congressional testimony
Investors were also waiting for earning season to begin.
United States
US stocks edged higher for the most part Monday, led by gains in technology stocks as investors were optimistic ahead of earnings. However, the Dow Jones industrials slipped just prior to the close and ended down 5.82 points. The S&P was up 0.1 percent while the Nasdaq was 0.4 percent higher. Trading was light. Traders seemed reluctant to make significant moves ahead of Federal Reserve Chair Janet Yellen’s semiannual testimony before Congress.
With earnings season about to start, investors are looking for big bank results from JPMorgan Chase, Wells Fargo and Citigroup. The healthcare sector was lower as investors waited for clarity on the healthcare legislation overhaul proposed in Washington. Amazon.com advanced ahead of its popular Prime Day shopping festival. Best Buy retreated on news that Amazon was planning to roll out a Geek Squad competitor.
Apple, Facebook, Microsoft and Nvidia rallied. Abercrombie & Fitch tumbled after it announced that it had ended talks to sell itself and would focus instead on carrying out its own plan as a stand-alone company. Wal-Mart offset strong gains by Nike and Visa. Hawaiian Telcom gained after agreeing to be acquired by Cincinnati Bell for $30.75 per share or about $650 million.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was down US$3.75 to US$1,211.90. Copper futures were up 0.1 percent to US$2.65. WTI spot crude was up 18 US cents to US$44.41. Dated Brent spot crude was up 19 US cents to US$46.90. The US dollar was up against the yen, pound and Swiss franc. The currency was virtually unchanged against the euro and the Canadian and Australian dollars. The Dollar Index was virtually unchanged. The yield on US Treasury 30 year bond was unchanged at 2.93 percent while the yield on the 10 year note was down 2 basis points to.2.37 percent.
Europe
European stocks advanced after Chinese inflation data was in line with expectations and investors were pleased by positive German trade data. However, investors were cautious before Federal Reserve Chair Janet Yellen’s semiannual testimony before the House Financial Services Committee on Wednesday and before the Senate Banking Committee on Thursday. The FTSE was up 0.3 percent, CAC gained 0.4 percent, the DAX advanced 0.5 percent and the SMI added 0.7 percent.
E.ON gained on a broker upgrade. Stada climbed after reports that Bain Capital and Cinven are increasing their offer price for the generic drug-maker. Lufthansa weakened on a broker downgrade. Imagination Technologies dropped on reports that Apple might be poaching talent from the microchip company. Facilities management and construction services company Carillion tumbled after a profit warning and CEO exit. Moeller-Maersk and Hapag advanced.
Almirall plunged in Madrid after the company reduced its FY17 revenue guidance. Nestlé rebounded from its previous week’s losses on a broker upgrade. LafargeHolcim and Adecco advanced. SGS also increased after it announced a small acquisition. Roche and Novartis climbed. Anglo American and BHP Billiton advanced along with Randgold Resources. HSBC and Standard Chartered were higher on the day.
Germany’s May exports were up a monthly 1.4 percent after increasing 0.9 percent in April. At the same time, imports were up 1.2 percent. The trade surplus rose to €20.3 billion in May from €19.7 billion a month ago.
Asia Pacific
Most Asian stocks were higher Monday — crude oil prices rebounded after tumbling Friday combined with the better than anticipated US employment data Friday helped bolster investor confidence. June employment added 222,000 jobs following an upwardly revised May increase of 152,000.
The Shanghai Composite edged down 0.2 percent as investors waited for key economic data that will be released during the week. Markets shrugged off June inflation data, which did little to alter investor views about the economy. Consumer prices in China rose an annual 1.5 percent in June, unchanged from May. The producer price index was up an annual 5.5 percent for the second month. The Hang Seng added 0.6 percent.
The Nikkei was up 0.8 percent and the Topix gained 0.5 percent. A weaker yen helped lift exporters, helping offset weak current account and core machine orders data. While Japan’s current account surplus fell in May for the first time in four months, core machinery orders unexpectedly tumbled due to persistent weakness in the services sector. The US dollar hit a two-month high against the yen after US job growth surged more than expected in June, adding to market expectations for a third US rate increase this year.
The S&P/ASX was up 0.4 percent while the All Ordinaries gained 0.3 percent. The big four banks advanced, tracking gains among their US peers on Friday. Woolworths and Harvey Norman Holdings advanced. Energy stocks ended mixed while both BHP Billiton and Rio Tinto ended on a flat note. South32 declined after announcing the closure of its Appin coal mine in New South Wales for an extended period due to a safety review.
The Kospi edged up 0.1 percent — investors here are waiting for earnings season to begin. The Sensex was 1.1 percent higher to close at fresh record highs with auto, telecom and technology stocks leading the surge on optimism over corporate earnings.
Looking forward
Australia posts May home loans. Italy releases May industrial production. Canada releases June housing starts. In the US, June NFIB small business optimism index, May JOLTS and wholesale trade will be reported.
Global Stock Markets
*Note — all releases are listed in local time.
Source: Fidelity
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