Global Economic Daily - 10/06/2024
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Closing Commentary
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Quote of the Day: Well done is better than well said. – Benjamin Franklin
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Equities: Stocks had a down day to end the week. The S&P 500 ended flat on Friday, touching a record-high intraday, despite a stronger-than-expected jobs report. The broad market index slipped 5.97 points to close at 5,346.99, after reaching an all-time high earlier in the session. The?Dow Jones Industrial Average?slipped 87 points to 38,798.99. The?Nasdaq 100?edged down 20.24 points to finish the session at 19,000.95. All three of the major averages notched a winning week. The Dow posted a 0.29% gain, while the S&P 500 added nearly 1.32% and the Nasdaq advanced 2.38%. Stocks are rebounding from pressure earlier in the session following Friday’s jobs report. That news sent the yield on the benchmark 10-year Treasury more than 15 basis points higher. Nonfarm payrolls?increased?by 272,000 in May, above the 190,000 estimate from Dow Jones and April’s 175,000 gain. Average hourly wages increased 0.4% last month and ticked up 4.1% from a year ago. However, even with the job gains, the unemployment rate ticked higher to 4%. Investors had been?hoping for weak jobs figures?on a hunch it would give the Federal Reserve the greenlight to cut rates later this year. Now, with the labor market showing continued resilience, Wall Street seems focused on the idea that the economy is strong enough to keep growing without the help of lower interest rates. The jobs report comes after the European Central Bank on Thursday cut rates for the first time since 2019, adding pressure to the Fed to potentially lighten up on policy. The Fed will give its decision on rates next week after its June 11-12 policy meetin. TECHNICAL OUTLOOK - The Dow and S&P are above the 14, 21 day moving average.
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Crude Oil: Oil prices edged down on Friday and posted a third straight weekly loss as investors weighed OPEC+ reassurances against the latest U.S. jobs data that lowered expectations that the Federal Reserve will cut interest rates soon. The European Central Bank went ahead with its first interest rate?cut?since 2019 on Thursday, despite an increasingly uncertain inflation outlook. However, oil prices have been buttressed by support from OPEC members Saudi Arabia and Russia, indicating readiness to?pause or reverse?oil output increases. Still, crude fell for a third straight week on demand concerns, with Brent down 2.5% and WTI off 1.9%. Oil slipped earlier this week after analysts saw?Sunday's OPEC meeting?as an indication of rising supply, which is bearish for prices. The U.S. active?oil rig count, an early indicator of future output, fell by four this week to 492, the lowest since January 2022, energy services firm Baker Hughes said. Meanwhile, in China, data showed that although exports grew for a second month in May, crude oil imports fell, signalling demand concerns in the world's largest crude oil buyer. In Russia, the operations of the Novoshakhtinsk oil refinery in southern Rostov region suffered significant disruptions after a fire following a drone attack on Thursday. TECHNICAL OUTLOOK – The Crude is way below the 14, 21 day moving average.
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Metals: Gold and silver prices are posting strong losses in early U.S. trading Friday, on a double-barrel hit from a strong U.S. jobs report and China’s central bank easing its gold purchases. Technically, August gold bulls have the overall near-term technical advantage but faded today. Prices are scoring a bearish “outside day” down on the daily bar chart. Also, a bearish double-top reversal pattern has formed on the daily bar chart to suggest a near-term market top is in place. Bulls’ next upside price objective is to produce a close above solid resistance at today’s high of $2,406.70. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the May low of $2,308.70. July silver futures bulls have the overall near-term technical advantage. However, prices today are scoring a big and bearish “outside day” down. Also, a four-week-old uptrend on the daily bar chart has been negated to suggest a near-term market top is in place. Silver bulls' next upside price objective is closing prices above solid technical resistance at the May high of $32.75. The next downside price objective for the bears is closing prices below solid support at $29.00. TECHNICAL OUTLOOK – Gold and silver are below the 14, 21 day moving average.
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DISCLAIMER: The Information and data contained herein was obtained from sources deemed reliable. The accuracy and completeness are not guaranteed
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