Markets around the world have remained active overnight and into this morning. The state of sheer panic that gripped trading early in the week has subsided for now but we continue to see significant swings in both directions creating opportunities for traders on both sides. China’s trading day today was similar to that of the US yesterday with stocks rallying early on the back of PBOC interest rate and bank reserve requirement cuts plus an increase to margin rates but these were short lived and stocks in both Shanghai and Hong Kong finished the day down again. Stocks in Japan and Australia fared much better. The Nikkei rebounded as JPY fell with capital flowing back out of defensive havens. CHF is falling as well while gold appears to have stabilized at a lower level near $1,130. The S&P/ASX benefitted from a rebound in interest in resource producers which also helped resource currencies like AUD, NZD CAD and MXN regain some lost ground. Crude oil has stabilized near $39.00 this morning getting some support from a drop in API inventories. Trading could be active around today’s DOE inventory report with traders looking for confirmation. Gasoline, meanwhile, remains under pressure ahead of inventories with the end of summer driving season approaching. European markets are mixed today. Indices like the DAX, CAC and FTSE are posting strong gains while GBP and continental currencies like EUR are giving back some of their recently acquired ground. NOK and SEK are underperforming their resource peers. US markets are off to a positive start this morning but after yesterday’s lack of follow-through action, traders’ optimism appears to be more cautious today. The reaction to today’s durable goods report could set the tone and kick off another round of speculation on when the Fed may start raising interest rates heading into the Fed’s Jackson Hole conference later this week. Corporate News Schlumberger agreed to purchase Cameron International for $66.36 per share through a combination of cash and stock, a 56% premium to recent levels. This could spark speculation on further consolidation in the oil and gas service sector given the steep decline in demand following the oil price crash. Royal Bank of Canada $1.66 vs street $1.67 Economic News Significant announcements released overnight include: US API crude oil inventories (7.3 mmbbls) vs previous 2.5 mmbbls NZ trade balance street ($600M) Singapore industrial production street (4.0%) Sweden consumer confidence street 97.4 Sweden trade balance street SEK 4.0B Norway unemployment rate street 4.3% UK CBI retail sales street 18 Upcoming significant announcements include: 8;30 am EDT US durable goods orders street (0.4%) 8:30 am EDT US durables ex transport street 0.3% 10:30 am EDT US crude oil inventories street 2.0 mmbbls CMC Markets is an execution only service provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
Durables may decide if US markets can hold their early gains this time
20:00, 25 August 2015