Daily global market review

The market's winning streak came to an end today as initial optimism gave way to a gradual loss of upward momentum. The S&P 500 and Dow Jones Industrial Average concluded the day with losses near their lowest levels, while the Nasdaq managed a modest gain. This subdued price action was attributed to a lack of strong conviction on either side of trading.

The day saw notable shifts primarily in individual stocks influenced by specific catalysts. Retail giants Dollar General and Five Below faced considerable declines, falling by 12.2% and 6.0%, respectively, after reporting quarterly results that fell short of consensus guidance. On the other hand, CrowdStrike and Salesforce, significant players in the tech and software industry, recorded substantial gains following their earnings reports.

In this dynamic, the strength of mega-cap stocks provided some support to the broader market. The Vanguard Mega Cap Growth ETF achieved a marginal gain, while the Invesco S&P 500 Equal Weight ETF and the market-cap weighted S&P 500 both experienced declines.

Across the S&P 500's sectors, seven of the eleven saw losses, with health care and utilities experiencing the steepest declines. The consumer discretionary sector was a bright spot with a gain of 0.5%, driven by positive movement in Amazon.

Market participants were analyzing favorable data indicating that the U.S. economy is not heading toward a significant downturn. Notably, initial jobless claims for the week ending August 26 were lower at 228,000, and July's personal spending demonstrated a healthy increase of 0.8%. While the PCE Price Index and core-PCE Price Index both rose by 0.2%, leading to year-over-year inflation readings of 3.3% and 4.2% respectively, these figures were within expectations.

Although there were slight adjustments in expectations for future rate hikes following the release of today's data, the response of the Treasury market was relatively muted. Atlanta Fed President Bostic emphasized that the Fed's monetary policy is appropriately restrictive, but he cautioned against any immediate easing.

Treasuries showed limited response to the morning's data, and during the cash session, some modest selling interest emerged. The 2-year note yield dropped by two basis points to 4.86%, while the 10-year note yield declined by three basis points to 4.09%.

In the context of year-to-date performance, various market indices displayed mixed results: Nasdaq Composite +34.1%, S&P 500 +17.4%, Russell 2000 +8.9%, S&P Midcap 400 +7.9%, Dow Jones Industrial Average +4.8%.

Reviewing the day's economic data, initial claims for the week were lower than expected at 175,000, with the previous week's numbers also revised slightly downward. The report indicated that the tight labor market does not align with a hard-landing economic scenario. July's personal income and spending figures were in line with expectations, while the PCE Price Index and core-PCE Price Index showed a moderate increase, reflecting a controlled uptick in inflation.

The August Chicago PMI was reported at 48.7, surpassing expectations of 45.0 and improving from July's reading of 42.8.

Trading in the Treasury market was observed, with the 10-year note yield experiencing a slight increase of 2/32, closing at 4.09%. The NYSE and Nasdaq reported differing advances and declines among stocks, indicating active trading activity.

Within industries, Consumer Discretionary, Information Technology, and Communication Services exhibited strength, while Real Estate, Health Care, Financials, Utilities, and Consumer Staples faced relative weakness.

Key market-moving factors included Salesforce's positive earnings and guidance, a muted response from Treasuries to the day's economic data, broader market impact from the performance of mega-cap stocks, and a general pullback in various stocks as the trading session progressed.

The market indices displayed a mix of changes across various regions. In the United States, the Dow exhibited a price of 34,721.91, experiencing a decrease of 168.33 points or a 0.48% decline. Similarly, the S&P 500 in the US displayed a reduction of 7.21 points, marking a 0.16% decrease. The NASDAQ, however, saw a modest upturn, with an increase of 15.66 points, resulting in a 0.11% rise. The VIX, which measures market volatility, declined by 0.31 points or 2.23%. The Russell 2000 in the US dipped by 3.54 points, equating to a 0.19% decrease. Similarly, the S&P/TSX Composite in Canada and the S&P/TSX 60 experienced drops of 37.70 and 1.94 points, translating to a 0.19% and 0.16% reduction, respectively. Moving to Brazil, the BOVESPA showed a decline of 1,793.29 points, reflecting a 1.53% decrease. In Chile, the S&P IPSA went down by 18.91 points, a 0.31% fall. Meanwhile, the S&P/BMV IPC in Mexico experienced a substantial decrease of 1,369.76 points, marking a 2.52% decline.

Across Europe, the STOXX Europe 50 index faced a decrease of 13.11 points or 0.33%. Similarly, the STOXX Europe 600 index observed a reduction of 0.94 points, a 0.20% dip. The FTSE 100 in the United Kingdom displayed a decrease of 34.54 points, equating to a 0.46% decline. In Italy, the FTSE MIB dropped by 85.18 points, marking a 0.29% decrease, while France's CAC 40 exhibited a decline of 47.70 points, reflecting a 0.65% reduction.

Turning to the Asian market, Japan's Nikkei 225 index witnessed an increase of 285.88 points, marking an 0.88% rise. In Hong Kong, the Hang Seng index experienced a decrease of 100.80 points, a 0.55% drop. Similarly, China's Shanghai Composite index observed a decline of 17.26 points, a 0.55% reduction. Australia's S&P/ASX 200 index, on the other hand, increased by 7.60 points, translating to a 0.10% rise. South Korea's KOSPI displayed a reduction of 4.95 points, marking a 0.19% decrease. In Taiwan, the Taiwan SE index decreased by 85.31 points, equating to a 0.51% drop.

• Tesla, Inc. (TSLA) saw its stock price rise to 258.08 with a positive change of 1.18 points, representing a 0.46% increase in value, backed by a trading volume of 109 million shares and a 52-week range of 101.81 to 313.80.
• Palantir Technologies Inc. Class A (PLTR) experienced a stock price drop to 14.98, marked by a decrease of 1.35 points, indicating an 8.27% decline; the trading volume stood at 101 million shares, while the 52-week range spanned from 5.92 to 20.24.
• Tilray Brands, Inc. (TLRY) observed a stock price increase to 2.96, accompanied by a positive change of 0.30 points, reflecting an 11.28% growth; the trading volume reached 90 million shares, and the 52-week range oscillated between 1.50 and 5.12.
• Apple Inc. (AAPL) noted a slight stock price uptick to 187.87, featuring a modest positive change of 0.22 points, equating to a 0.12% increase; with a trading volume of 61 million shares, its 52-week range extended from 124.17 to 198.23.
• Advanced Micro Devices, Inc. (AMD) experienced a stock price dip to 105.72, displaying a decrease of 0.87 points, reflecting a 0.82% decline; its trading volume reached 59 million shares, and the 52-week range fluctuated between 54.57 and 132.83.
• Amazon .com Inc. (AMZN) demonstrated a stock price increase to 138.01, marked by a positive change of 2.94 points, signaling a 2.18% growth; trading volume was 59 million shares, and the 52-week range spanned from 81.43 to 143.63.
• Nu Holdings Ltd. Class A (NU) witnessed a stock price decrease to 6.85, with a decline of 0.19 points, indicating a 2.70% drop; trading volume amounted to 55 million shares, and the 52-week range extended from 3.39 to 8.29.
• NVIDIA Corporation (NVDA) observed its stock price increase to 493.55, accompanied by a positive change of 0.91 points, resulting in a 0.18% growth; trading volume reached 53 million shares, and the 52-week range oscillated between 108.13 and 502.66.
• NIO Inc. Sponsored ADR Class A (NIO) experienced a stock price drop to 10.27, marked by a decrease of 0.40 points, representing a 3.75% decline; trading volume stood at 51 million shares, and the 52-week range extended from 7.00 to 22.74.
• Intel Corporation (INTC) noted a stock price uptick to 35.14, displaying a positive change of 0.61 points, equating to a 1.77% increase; with a trading volume of 48 million shares, its 52-week range fluctuated between 24.59 and 37.19.

In the realm of cryptocurrencies, the Nasdaq Crypto Index remained relatively stable, experiencing no change in value. Similarly, major cryptocurrencies such as Bitcoin, Ether, Litecoin, and XRP displayed no change in value.

Regarding currencies, the Euro/US Dollar exchange rate slightly increased by 0.0002 points or 0.02%. The British Pound/US Dollar exchange rate similarly increased by 0.0001 points or 0.01%. Conversely, the US Dollar/Canadian Dollar exchange rate decreased by 0.0001 points or 0.02%, while the US Dollar/Swiss Franc exchange rate dipped by 0.0001 points or 0.01%. Additionally, the US Dollar/Japanese Yen exchange rate decreased by 0.02 points, marking a 0.01% reduction.

Lastly, in the realm of bonds and rates, the 3 Month Treasury yield experienced a minor decrease of 0.005% to reach 5.310%. The 2 Year Treasury yield, however, increased by 0.024% to reach 4.862%. Similarly, the 5 Year Treasury yield rose by 0.026% to reach 4.254%, and the 10 Year Treasury yield increased by 0.023% to reach 4.113%. The 30 Year Treasury yield also saw a slight increase of 0.011% to reach 4.218%.

The Bloomberg Commodity Index, represented as BCOMTR:IND, experienced a slight decrease of 0.07%, with the value reaching 239.08. Another index, UBS Bloomberg CMCI (CMCITR:IND), decreased by 0.04% to 1,547.40. The Reuters/Jefferies CRB Index (CRYTR:IND) exhibited a positive movement of 0.28%, reaching 316.38. Similarly, the Rogers International Index (RICIGLTR:IND) displayed a 0.29% increase, resulting in a value of 3,846.10. The S&P GSCI Index (SPGSCITR:IND) saw a significant growth of 0.81%, with a recorded value of 3,600.72.

Shifting focus to the energy sector, specific energy commodities and their respective changes were provided. WTI Crude Oil (CL1:COM) recorded a slight decrease of 0.10% to reach a price of 83.55 USD/bbl. Conversely, Brent Crude (CO1:COM) saw a notable increase of 1.16%, amounting to 86.86 USD/bbl. RBOB Gasoline (XB1:COM) experienced a decline of 1.52%, pricing at 276.64 USd/gal. Natural Gas (NG1:COM) exhibited a decrease of 0.58%, valued at 2.75 USD/MMBtu. On the other hand, Heating Oil (HO1:COM) displayed a positive movement of 1.50%, reaching 314.26 USd/gal.

In the realm of precious and industrial metals, changes in prices were observed. Gold (GC1:COM) showed a slight increase of 0.02% to 1,966.30 USD/t oz. Gold Spot (XAUUSD:CUR), however, experienced a decrease of 0.01%, with a value of 1,939.98 USD/t oz. Silver (SI1:COM) exhibited no change in price but a slight decrease of 0.01% to 24.81 USD/t oz. Copper (HG1:COM) displayed a positive shift of 0.25%, pricing at 383.15 USd/lb. Platinum Spot (XPTUSD:CUR) experienced a marginal decrease of 0.01%, amounting to 971.83 USD/t oz.

Lastly, within the agriculture sector, several agricultural commodities were covered. Corn (C 1:COM) demonstrated a decrease of 0.52% to reach a value of 478.25 USd/bu. Wheat (W 1:COM) exhibited a decline of 0.82%, amounting to 602.00 USd/bu. Cocoa (CC1:COM) experienced a minor decrease of 0.03%, reaching a price of 3,638.00 USD/MT. Cotton #2 (CT1:COM) showcased a decrease of 0.07% to 87.82 USd/lb. Lastly, Live Cattle (LC1:COM) displayed a positive movement of 0.43%, with a value of 180.83 USd/lb.

Scheduled economic data for tomorrow encompasses a range of indicators. At 8:00 PM ET, the Motor Vehicle Sales report will unveil the Annual Rate of North American-Made Sales and Total Vehicle Sales. This release is expected to have a moderate impact. Subsequently, at 8:30 AM ET, the Employment Situation data will be disclosed, revealing insights into the Average Workweek, Manufacturing Payrolls, Nonfarm Payrolls, Average Hourly Earnings, Average Hourly Earnings on a monthly basis, Participation Rate, Unemployment Rate, and Private Payrolls. The PMI Manufacturing Final index is anticipated at 9:45 AM ET, carrying a moderate impact. At 10:00 AM ET, Construction Spending data will be disclosed, encompassing both year-over-year and month-over-month figures. Simultaneously, the ISM Manufacturing Index will be released, bearing a high impact. Lastly, the Baker Hughes Rig Count report at 1:00 PM ET will offer rig count data for various regions, with a low anticipated impact.

• Equity Market Trends: Despite closing lower in the most recent trading session, the U.S. and Canadian equity markets are expected to finish the week with gains of over 2%. Although the markets have experienced a decline over the month, they have recovered significantly from their mid-August lows. Both the S&P 500 and Nasdaq indexes, which previously corrected by around 5% and 7% respectively, are projected to close the month down by just 1%-2%. This suggests that the markets have undergone a rebound and may be stabilizing after the earlier corrections.
• Inflation Outlook: The PCE inflation, a key measure for the Federal Reserve, was in line with expectations for July. The headline PCE inflation stood at 3.3% year-over-year, slightly above the previous month's reading of 3.0%. Core PCE inflation, which excludes volatile food and energy prices, reached 4.2%, surpassing the Fed's 2.0% target and showing a continued elevated level. However, this core inflation figure has been gradually cooling since its peak in June 2022. The expectation is that core inflation might continue to decrease due to cooling shelter and rent prices, leading to a more moderate inflationary environment.
• Labor Market Trends: The data indicates that job openings, ADP private-payroll figures, and weekly jobless claims have softened recently. Jobless claims came in lower than expected, signaling healthy job market conditions. The combination of these trends has provided support to both equity and bond markets. Cooling wage growth and economic growth would likely encourage the Federal Reserve to pause its rate-hiking cycle, leading to lower Treasury yields and supporting bond prices. This, in turn, has positively influenced stock-market sentiment.
• Nonfarm Payrolls Report: The upcoming U.S. nonfarm-payrolls report for August is anticipated to show an increase of 170,000 jobs, slightly below the previous month's figure of 187,000. Additionally, wage growth is expected to tick lower to 4.3% year-over-year from 4.4% last month. This suggests a possible moderation in employment gains and wage growth, which aligns with the overall trend of easing job market data. The report's results could influence market sentiment and potentially impact the Federal Reserve's decisions on monetary policy.