Market Talk – March 13, 2019

Asia:

Most of the major Asian markets closed in the red today. Decreases were led by NIKKEI 225 (-253.27 points, -1.18%, 21,243 close), followed by Shanghai (-32.82 points, -1.07%, 3,027 close). Hang Seng was down this Wednesday as well (-101.92 points, -0.35%, 28,818 close). KOSPI and ASX200 both posted losses for the day (-5.81 points, -0.27%, 2,151 close) and (-18.93 points, -0.31%, 6155 close) respectfully. However, SENSEX took the opposite route and increased by over 216 points (+0.58%,37,752 close).

The Asian currency markets had a mixed day. The AUDUSD increased 0.0011 or 0.16% to 0.7091; the NZDUSD decreased 0.0006 or 0.09% to 0.6853; the USDJPY decreased 0.3020 or 0.27% to 111.0480, and the USDCNY dropped 0.00002 points traded at 6.7051.

Both gold and silver performed well today after increasing 9.14 USD/t oz. or 0.70% to 1,312.98 and 0.04 USD/t. oz or 0.28% to 15.51.

New economic figures for Asia were posted this Wednesday:

  • Japan’s Tertiary Industry Activity Index (MoM) increased from -0.5% to 0.4%
  • Indian’s M3 Money Supply dropped from 10.8% to 10.5%

Europe:

The results are in: Britain will not exit the EU without a deal in place. The no-deal Brexit vote passed 312 votes to 278 this Wednesday. As expected, Brussels responded to the news unfavorably, declaring that they will not renegotiate a deal. On Thursday, lawmakers will meet again to determine whether to extend the official date of departure.

The pound rose nearly 2% against the USD upon hearing the news.

Most of the major European markets closed in the green this Wednesday. The FTSE 100 gained 8 points or 0.11% to 7,159; CAC 40 increased 36 points or 0.69% to 5306, and DAX increased 48 points or 0.42% to 11572.

Most of the major European currencies increased against USD today. The GBPUSD increased 0.01861 points (+1.42%) to 1.32591; the EURUSD increased 0.0044 or 0.39% to 1.1330. However, the USDCHF decreased 0.0045 or 0.45% to 1.0032.

Some economics news from Europe:

  • Spanish CPI (YoY) (Feb) increased from 1.0% to 1.1%.
  • Spanish CPI (MoM) (Feb) increased from -1.3% to 0.2%.
  • Spanish HICP (YoY) (Feb) remained the same at 1.1%
  • Spanish HICP (MoM) (Feb) increased from -1.7% to 0.2%
  • Italian Quarterly Unemployment Rate increased from 10.3% to 10.6%
  • Euro zone- Industrial Production (MoM) (Jan) increased from -0.9% to 1.4%
  • Euro zone- Industrial Production (YoY) (Jan) increased from -4.2% to -1.1%

U.S./Americas:

U.S. markets were relatively strong Wednesday. The S&P 500 advanced for the third consecutive day, reaching a new high for 2019 after closing at 2810.92 (+0.69%). In similar fashion, the Nasdaq jumped +0.69% (7643.40 close). The Dow closed in positive territory for the first time this week after gaining over 148 points (+0.58%, 25702.89 close). The Russell 2000 was also positive, increasing +0.39% (1555.88 close).

Tech stocks have seen a rebound of late, rising as a whole by over 3% for the week. Nvidia continued its climb, rising by over +6% midday before closing +3.75%. Take-Two Interactive Software rose by nearly +7%. Intel (+1.49%), Netflix (+1.39%), Microsoft (+0.77%), Facebook (+0.84%), Oracle (+0.51%), and Apple (+0.44%) were among the other technology stocks to post gains during the session.

On the economic front, the Commerce Department finally released some January data that had been delayed by the partial government shutdown. Non-defense durable goods orders reached a six-month high in January after rising 0.8%. Machinery orders were boosted by 1.4%, while electrical orders soared 1.7%.

Construction spending increased in January as well, rising 0.3% from the prior year. Public construction projects rose by 4.9%, federal construction projects jumped 4.2%, and private construction projects rose by 0.2%. Data for February will be published at the beginning of April.

Canada and the U.S. joined the ever-growing number of countries who have grounded all Boeing 737 MAX planes. The 737 model was responsible for two crashes within the past six months. Despite the news, Boeing shares closed in the green for the first time this week (+0.46%).

The USD Index lost -0.54% this Wednesday (last reading 96.42). The USD/CAD declined by -0.41% (last reading 1.3297).

Canadian indexes remained largely unchanged from the previous day’s session. The TSX Composite closed at 16149.97 (+0.08%) and the TSX 60 closed at 962.71 (+0.06%).

Brazil’s Bovespa had it’s second strong day of the week after gaining +1.10% from the previous day’s session (98903.88 close).

Energy:

Crude increased 1.53 USD/BBL or 2.69% to 58.4122; Brent increased 1 USD/BBL or 1.50% to 67.54; natural gas increased 0.04 USD/MMBtu or 1.36% to 2.82; gasoline increased 0.05 USD/GAL or 2.91% to 1.87, and heating oil increased 0.01 USD/GAL or 0.51% to 1.99.

Top commodity losers this Wednesday were wheat (-1.66%), rubber (-0.55%), and coffee (-1.28%). Gains were led by gasoline (+2.90%), crude oil (+2.64%), and Brent (+1.48%).

Bonds:

Japan -0.04%(-1bp), US 2’s 2.47% (+1bps), US 10’s 2.62%(+1bps), US 30’s 2.99%(-4bps), Bunds 0.07% (-0bp), France 0.48% (+0bp), Italy 2.56% (-2bp), Turkey 15.25% (+30bp), Greece 3.87% (-1bp), Portugal 1.33% (-1bp), Spain 1.19% (+0bp) and UK Gilts 1.18% (-2bp).

  • US 30-year Bond Auction dropped from 3.022% to 3.014%
  • German 30-year Bund Auction increased from 0.720% to 0.740%
  • Italian 3-year BTP Auction increased from 0.99% to 1.06%

Italian 7-year BTP Auction decreased from 2.26% to 2.05%