Hello Everyone, this coming week we’ll see a number of potential market impact events that could move price action around a good deal and drive Volatility higher (or lower)…we will see key Earnings from major Tech companies, we’ll see our first pass of Q2 GDP, we’ll get the FED Policy statement and if all this is not enough, we’ll get more details of the US Fiscal Stimulus Package currently being negotiated. Get me take on the markets below’
Weekly Sound Bites;
• US Indexes ended the week mixed for the week after surrendering early gains; at its Thursday peak, the S&P moved within nearly 3% of its all-time high in February…Technology stocks and the tech-heavy Nasdaq Composite Index fared worst, dragged down by declines in Apple and several chipmakers. Energy stocks outperformed within the S&P 500 as oil prices rallied early in the week… Stocks took their sharpest turn lower on Thursday afternoon with worries on the slowness of another expected US Fiscal Stimulus and the closure of the Chinese Consulate in Houston…
• The Big 5 (FB, AMZN, AAPL, GOOGL & MSFT) account for about 22% of the market cap of the S&P…this shows the narrow market breadth of the current markets and this coming week we will get a solid idea of how Tech will fare with Earnings from FB, AAPL, AMZN and GOOGL…we’ve seen MSFT not perform as expected and that has sent the NASDAQ down with these stocks selling off in anticipation of their coming earnings this week…this has no doubt weighed on the S&P and DOW performance this past week…
• The week’s economic data were mixed but included some cautionary signals that growth was slowing after rebounding sharply in late spring. Most notably, initial unemployment claims from the previous week rose from 1.31 million to 1.41 million, the first increase since March…also moving lower during the week was the US 10 Year Treasuries as the Fed’s targeted purchases of 20- and 30-year Treasury bonds are continuing to have its intended affect…
• We are also seeing the USD come under continued selling pressure as measured against the Euro, Yen and British Pound move to lows not seen since 2018…With massive stimulus and negative real yields have further dampened any bullish sentiment in the USD…as a result we are also seeing strength across all commodity sectors with precious metals like Gold and Silver up strong and Copper reach 2 year highs…the materials sector will also benefit from a weakened USD..
• After five days of haggling, EU leaders agreed to a historic deal on a EUR 750 billion stimulus plan…As a result, the European Commission, can now raise billions of euros in capital markets on behalf of all member Countries…The fund will comprise EUR 390 billion in grants—instead of the proposed EUR 500 billion—and EUR 360 billion in low-interest loans…Italy will likely be the biggest recipient.
Enjoy this week’s Weekly Round-Up;
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