News & Analysis

Overnight on Wall Street: Tuesday 14 July 2020

July 14, 2020

By Deepta Bolaky
@DeeptaGOMarkets

Equity Markets

Vaccines updates have set a positive tone for the stock market on Monday. European stocks rallied on the news that Pfizer and BioNTech granted FDA fast track designation for two investigational mRNA-based vaccine candidates against SARS-CoV-2. 

The US sharemarket failed to hold on to intraday gains and fell in the final hours of trading dragged by brewing tensions with China over the Chinese claims in the South China Sea and the rising coronavirus cases.


Source: Bloomberg Terminal

Wall Street ended mixed leaving Nasdaq with significant losses dragged by technology and tech-related stocks:

  • Dow Jones Industrial Average added 11points or 0.04% to 26,086.
  • S&P 500 fell by 30 points or 0.9% to 3,155.
  • Nasdaq Composite lost 227 points or 2.1% to 10,391.

On the earnings calendar, PepsiCo’s second-quarter earnings report stood out. The company reported earnings before the bell:

  • PepsiCo’s net sales fell by 3.1% during the second quarter.
  • Pepsi earned an adjusted $1.32 a share as revenue fell 3.1%. Earnings per share came above expectations. 
  • Given the tough challenges, the company saw resilience in its global snacks and foods business. 

The company’s share price rose by nearly 3% before retreating lower to end the day by 0.3% higher at $134.91. The immediate attention will be on the big banks reporting on Tuesday – JP Morgan Chase, Citigroup Inc, and Wells Fargo are expected to report quarterly updates before the bell.

Currency Markets

In the FX space, major currencies were mixed against the US dollar. The risk reversal also took place towards the end of the US session which helped the greenback to edge higher. 

After trading close to 70 US cents, the Aussie dollar fell from its highs for the day to close at around 69.40 US cents.


Source: GO MT4

The Pound was among the weakest currencies against the US dollar. With no development on the Brexit front, the Sterling struggled to find an upside direction. The GBPUSD pair fell to a low of 1.2550 on Monday.


Source: GO MT4

The Pound edged higher and managed to shrug off Germany’s gloom stance on Brexit deal. The GBPUSD pair rose to a high of 1.2623 on Wednesday.


Source: GO MT4

Commodities

Crude oil prices have been under renewed pressure in the US session despite positive vaccines headlines. We expect traders to keep monitoring weekly and monthly reports for fresh trading impulse. As of writing, WTI Crude oil (Nymex) and Brent Crude (ICE) were trading lower around $39.43 and $42.10, respectively.

Gold

Gold price swung between gains and losses following the risk-on and off sentiment. As of writing, the precious metal has dipped slightly below the $1,800 mark.


Source: GO MT4

By Deepta Bolaky
 @DeeptaGOMarkets

Key upcoming events

  • REINZ House Price Index (New Zealand)
  • Exports, Imports, and Trade Balance (China)
  • BRC Like-For-Like Retail Sales, Industrial & Manufacturing Production, and Gross Domestic Product (UK)
  • Harmonized Index of Consumer Prices ad ZEW Survey – Current Situation and Economic Sentiment (Germany)
  • Consumer Price Index (US)
  • SNB’s Chairman Jordan speech (Switzerland)
Wednesday, 15 July 2020 
Indicative Index Dividends
Dividends are in Points
ASX200WS30US500US2000NDX100CAC40STOXX50
0.04100.0660.001000
ESP35ITA40FTSE100DAX30HK50JP225INDIA50
0000000


Disclaimer: Articles and videos from GO Markets analysts are based on their independent analysis. Views expressed are of their own and of a ‘general’ nature. Advice (if any) are not based on the reader’s personal objectives, financial situation or needs. Readers should, therefore, consider how appropriate the advice (if any) is to their objectives, financial situation and needs, before acting on the advice.

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