Daily global market review

The trading session began with an underlying positive tone, even though there was a mixed performance among the major indices. Initially, the S&P 500 and Nasdaq showed slight losses and were trading below their 50-day moving averages, while the Dow Jones Industrial Average and Russell 2000 were in positive territory. Market breadth was generally positive during this period.

The early underperformance of the S&P 500 and Nasdaq was primarily attributed to weakness in the mega-cap segment and a substantial decline in Oracle (ORCL), which reported earnings and provided guidance that fell short of expectations, leading to a sharp 13.5% drop in its stock price.

During the mid-day session, there was a brief uptick that pushed the S&P 500 above its 50-day moving average, but this momentum could not be sustained. Consequently, the afternoon witnessed increased selling activity, causing the major indices to gradually decline. Ultimately, the Dow Jones Industrial Average closed with only a slight loss, while the S&P 500 and Nasdaq Composite finished near their lowest levels of the day.

The losses observed across the market were widespread, with mega-cap stocks exerting a notable influence on index performance. The Vanguard Mega Cap Growth ETF (MGK) experienced a 1.2% decline, whereas the market-cap weighted S&P 500 posted a 0.6% drop compared to a more modest 0.1% decline in the Invesco S&P 500 Equal Weight ETF (RSP).

Apple (AAPL) exhibited weakness ahead of its highly anticipated product event and retreated further following announcements that included the unveiling of the iPhone 15.

Additionally, rising oil prices, reaching their highest levels since the previous November at $89.95 per barrel, presented another challenge for the market. This surge in oil prices benefited the S&P 500 energy sector, which soared by 2.3% and outperformed other sectors by a significant margin.

On the contrary, the heavily-weighted information technology sector experienced the most substantial decline, with a 1.8% drop.

Regarding the bond market, Treasury yields remained relatively stable compared to the previous day, with anticipation building for the release of the August Consumer Price Index scheduled for 8:30 a.m. ET on Wednesday. The 2-year note yield increased by one basis point to reach 5.00%, while the 10-year note yield declined by two basis points to settle at 4.26%.

In terms of economic data, the day's highlight was the release of the August NFIB Small Business Optimism index, which recorded a decline from 91.9 to 91.3.

In the United States, the Dow Jones Industrial Average closed at 34,645.99, with a minor decrease of 0.05%, equivalent to -17.73 points. The S&P 500 also experienced a decrease of 0.57%, reflecting a change of -25.56 points, ending at 4,461.90. In contrast, the NASDAQ Composite declined by 1.04%, losing -144.28 points, and settling at 13,773.61. Additionally, the VIX, a measure of market volatility, increased by 3.12%, with a rise of +0.43 points, closing at 14.23. The Russell 2000 index saw a negligible gain of 0.01%, with an increase of +0.18 points, concluding at 1,855.32. In Canada, the S&P/TSX Composite index rose by 0.20%, gaining +40.32 points, and closing at 20,223.08. The S&P/TSX 60 index also increased by 0.23%, adding +2.84 points, settling at 1,212.62. Meanwhile, in Brazil, the BOVESPA index reported a gain of 0.93%, with +1,084.78 points, reaching 117,968.12. In Chile, the S&P IPSA index increased by 0.12%, gaining +7.27 points, and closing at 5,886.42. Conversely, in Mexico, the S&P/BMV IPC index experienced a decrease of 0.78%, losing -407.04 points, and ending at 51,860.45.

Moving to Europe, the STOXX Europe 50 index had a minimal change of 0.04%, with a decrease of -1.66 points, concluding at 3,964.53. The STOXX Europe 600 index also experienced a slight decrease of 0.18%, losing -0.81 points, and ending at 455.40. In the United Kingdom, the FTSE 100 index saw a gain of 0.41%, with +30.66 points, closing at 7,527.53. In Italy, the FTSE MIB index reported an increase of 0.21%, with +59.48 points, concluding at 28,584.58. The CAC 40 index in France declined by 0.35%, with -25.39 points, settling at 7,252.88.

In Asia, the Nikkei 225 index in Japan recorded a gain of 0.95%, with +308.61 points, ending at 32,776.37. In Hong Kong, the Hang Seng index declined by 0.39%, losing -70.56 points, and concluding at 18,025.89. The Shanghai Composite index in China experienced a slight decrease of 0.18%, with -5.72 points, and settling at 3,137.06. The S&P/ASX 200 index in Australia had no change, remaining at 7,206.90. In South Korea, the KOSPI index declined by 0.79%, losing -20.30 points, and closing at 2,536.58. The Taiwan SE index in Taiwan rose by 0.85%, with +139.76 points, concluding at 16,572.71.

In the Indian stock market, various indices experienced fluctuations in their values on the given date. Among them, the BSE MidCap index had the highest percentage loss, declining by 2.96%, with a decrease of 980.03 points. Its high and low points were 33,245.85 and 32,052.46, respectively. On the other hand, the BSE Sensex index recorded a modest gain of 0.14%, with an increase of 94.05 points, fluctuating between a high of 67,539.10 and a low of 66,948.18. Among the indices with notable losses, the BSE SmallCap index declined by 4.02%, shedding 1550.66 points, with a trading range of 38,769.33 (high) and 36,931.57 (low). Conversely, the India VIX index increased by 3.02%, adding 0.3425 points, with a high of 12.0225 and a low of 10.7125. Other indices experienced losses as well, such as the NIFTY Midcap 100 (-3.07%), NIFTY Smallcap 100 (-4.10%), and Nifty smallcap 50 (-4.27%), with corresponding point decreases of 1273.90, 532.05, and 256.15. The Nifty 100, Nifty 200, and Nifty 500 indices also saw declines of 0.33%, 0.75%, and 1.09%, with point losses of 65.60, 80.35, and 192.80, respectively. The Nifty 50 index, while having a minimal decrease of 0.02%, lost 3.15 points, fluctuating between 20,110.35 and 19,914.65. Conversely, the Nifty 50 USD and Nifty 50 Value 20 indices exhibited slight gains of 0.12% and 0.04%, with increases of 9.75 and 4.10 points, respectively. Various other indices, such as the Nifty Midcap 150, Nifty Midcap 50, Nifty Next 50, Nifty Smallcap 250, S&P BSE ALLCAP, S&P BSE-100, S&P BSE-200, and S&P BSE-500, also experienced losses ranging from 0.38% to 4.10%, each with their own specific point decreases.

In the world of cryptocurrencies, the Nasdaq Crypto Index increased by 3.59%, with a gain of +51.95 points, closing at 1,497.64. Bitcoin (BTC) showed a gain of 3.98%, rising by +1,000.00 points and reaching 26,120.00. Ethereum (ETH) also saw an increase of 3.41%, gaining +52.80 points, and closing at 1,602.00. Litecoin (LTC) had a gain of 2.93%, with +1.72 points, concluding at 60.47. Ripple (XRP) increased by 1.82%, gaining +0.01 points, and closing at 0.48.

In the realm of bonds and rates, the yields for various Treasury bonds fluctuated. The 3 Month Treasury yield stood at 5.285%, showing a decrease of -0.017%. The 2 Year Treasury yield increased to 5.037%, with a change of +0.042%. The 5 Year Treasury yield rose to 4.433%, with +0.021%. The 10 Year Treasury yield remained relatively stable at 4.284%, showing a minimal change. The 30 Year Treasury yield decreased to 4.352%, with a change of -0.027%.

Regarding currency exchange rates, the Euro to US Dollar rate was 1.0756, with a minimal change of 0.05%. The British Pound to US Dollar rate was 1.2493, showing a decrease of 0.17%. The US Dollar to Canadian Dollar rate was 1.3557, with a decrease of 0.18%. The US Dollar to Swiss Franc rate was 0.8914, with a slight increase of 0.07%. The US Dollar to Japanese Yen rate was 147.0830, with an increase of 0.34%.

• Tesla, Inc. (TSLA) closed at a price of 267.48, reflecting a decrease of 6.10 points or 2.23%, with a trading volume of 136 million shares. Its 52-week range spans from 101.81 to 313.80.
• Apple Inc. (AAPL) ended at 176.30, experiencing a decrease of 3.06 points or 1.71%, with a trading volume of 90 million shares. Its 52-week range extends from 124.17 to 198.23.
• Oracle Corporation (ORCL) concluded at 109.61, indicating a significant decrease of 17.10 points or 13.50%, with a trading volume of 68 million shares. Its 52-week range covers 60.78 to 127.54.
• WeWork Inc. Class A (WE) closed at 5.74, showing an increase of 2.67 points or 86.97%, with a trading volume of 61 million shares. Its 52-week range is from 2.61 to 176.40.
• Tilray Brands, Inc. (TLRY) settled at 2.91, reflecting a decrease of 0.40 points or 12.08%, with a trading volume of 60 million shares. Its 52-week range spans from 1.50 to 5.12.
• Intel Corporation (INTC) ended at 38.86, with a minor increase of 0.27 points or 0.70%, accompanied by a trading volume of 55 million shares. Its 52-week range covers 24.59 to 40.07.
• Ford Motor Company (F) closed at 12.45, showing an increase of 0.23 points or 1.88%, with a trading volume of 49 million shares. Its 52-week range extends from 10.90 to 15.74.
• Advanced Micro Devices, Inc. (AMD) concluded at 105.31, with a minimal change of -0.01 points or 0.01%, and a trading volume of 44 million shares. Its 52-week range spans from 54.57 to 132.83.
• Kenvue, Inc. (KVUE) settled at 21.06, reflecting a decrease of 1.01 points or 4.58%, with a trading volume of 44 million shares. Its 52-week range covers 20.38 to 27.80.
• Amazon Inc. (AMZN) ended at 141.23, experiencing a decrease of 1.87 points or 1.31%, with a trading volume of 42 million shares. Its 52-week range extends from 81.43 to 143.63.

The Bloomberg Commodity index recorded a value of 241.29, marking a slight increase of 0.34 points or 0.14%. It reached a high of 241.82 and a low of 240.24. The UBS Bloomberg CMCI index stood at 1,572.71, with a minor decrease of -0.06 points. Its high and low were 1,576.83 and 1,569.65, respectively. The Reuters/Jefferies CRB index showed a value of 323.08, indicating an uptick of 1.20 points or 0.37%. Its high and low for the period were 323.08 and 321.88. The Rogers International index reported a value of 3,904.73, marking a gain of 14.94 points or 0.38%. Its high and low reached 3,913.36 and 3,884.48.

In the energy sector, WTI Crude Oil on Nymex was priced at 88.82 USD/bbl., showing a substantial gain of 1.53 points or 1.75%. Brent Crude on ICE was at 92.03 USD/bbl., reflecting an increase of 1.39 points or 1.53%. RBOB Gasoline on Nymex reported a value of 271.94 USd/gal., with a marginal increase of 0.07 points or 0.03%. Natural Gas on Nymex was trading at 2.75 USD/MMBtu, showing a significant rise of 0.14 points or 5.33%. Heating Oil on Nymex was at 332.58 USd/gal., experiencing a decrease of -3.64 points or -1.08%.

In the Precious and Industrial Metals category, Gold on Comex closed at 1,935.80 USD/t oz., showing a decrease of -11.40 points or -0.59%. Gold Spot was priced at 1,913.51 USD/t oz., marking a decrease of -8.79 points or -0.46%. Silver on Comex exhibited a value of 23.36 USD/t oz., with a marginal decrease of -0.02 points or -0.10%. Copper on Comex was valued at 379.05 USd/lb., reflecting a decrease of -1.65 points or -0.43%. Platinum Spot stood at 913.35 USD/t oz., indicating a gain of 9.41 points or 1.04%.

In the Agriculture sector, Corn on CBOT was priced at 477.00 USd/bu., marking a decrease of -8.75 points or -1.80%. Wheat on CBOT reported a value of 587.25 USd/bu., showing an increase of 2.75 points or 0.47%. Cocoa on ICE was valued at 3,649.00 USD/MT, reflecting a decrease of -7.00 points or -0.19%. Cotton #2 on ICE stood at 88.30 USd/lb., indicating an increase of 0.52 points or 0.59%. Live Cattle on CME was priced at 184.03 USd/lb., showing a decrease of -0.20 points or -0.11%.

On Wednesday, September 13, 2023, a range of economic data releases is scheduled. At 7:00 AM ET, the MBA Mortgage Applications data will be published, including the Refinance Index, Purchase Index, and Composite Index, all on a week-over-week basis. Subsequently, at 8:30 AM ET, the Consumer Price Index (CPI) data will be released, providing insights into both month-over-month (M/M) and year-over-year (Y/Y) changes. At 10:00 AM ET, the Atlanta Fed Business Inflation Expectations for the year over year will be disclosed. Following this, at 10:30 AM ET, the EIA Petroleum Status Report will be published, featuring data on Gasoline Inventories, Crude Oil Inventories, and Distillate Inventories, all on a week-over-week basis. Lastly, at 2:00 PM ET, the Treasury Statement will be released, providing the Balance data.

• Market Reaction to Inflation Report: The stock market's performance is likely to be influenced significantly by the upcoming CPI (Consumer Price Index) inflation report for August. If the report shows headline CPI inflation moving higher, as expected, it could lead to initial market jitters and potentially drive stock prices lower, particularly in sectors sensitive to inflation, such as technology.
• Tech Sector Volatility: The technology-heavy Nasdaq is expected to remain volatile in response to the inflation report. If the core CPI inflation indeed moves lower, as forecasted, it may alleviate some concerns about rapidly rising prices and provide relief for technology stocks, which have been sensitive to inflation-related fears.
• Treasury Yields and Interest Rates: The stability in Treasury yields ahead of the inflation report indicates that the bond market is also awaiting the data. However, if the CPI report surprises with a significant increase in inflation, it could put upward pressure on Treasury yields, potentially pushing the 10-year yield closer to the high end of its recent range (around 4.27% to 4.34%). This would have implications for interest rates on various financial products.
• Range for Treasury Yields: The prediction that yields should remain in the 3.5% - 4.5% range, with the possibility of approaching the high end, suggests that investors anticipate continued interest rate volatility. This could impact borrowing costs for businesses and consumers and influence investment decisions in the bond market.
• Fed's Rate-Hiking Cycle: The data suggests that the Federal Reserve may be nearing the end of its rate-hiking cycle if core inflation continues to moderate, even if headline inflation experiences volatility due to factors like oil and gasoline prices. This prediction aligns with the central bank's approach to focus on core inflation trends when making monetary policy decisions.
• Retail Sales and Consumer Health: After the focus on inflation, attention will shift to U.S. retail sales figures for August. Expectations of moderating retail sales could indicate a potential softening in consumer spending. Factors such as higher interest rates and cooling job market growth are cited as reasons for this potential softening. However, this shift in consumer behavior could lead to improved trends in services inflation.