Global Economic Daily - 18/07/2024
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Quote of the Day: Life consists of holding good cards and playing those you hold well. – Josh Billings
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Equities: Stocks were somewhat mixed but overall lower. The?S&P 500?and?Nasdaq 100?retreated on Wednesday as the rotation out of high-flying technology shares and into more rate-sensitive names continued. The broad S&P 500 lost 78.93 points to close at 5,588.27. The tech-heavy Nasdaq 100 slid 599.48 points to end at 19,799.14, posting its worst session since December 2022 and closing below 18,000 for the first time since July 1. But the?Dow Jones Industrial Average?bucked the downtrend, adding 243.60 points to end at 41,198.08. That propelled the index to its first-ever close above 41,000. On the other hand, the S&P 500 and Nasdaq were weighed down by a continued pullback in megacap technology stocks. That marks a turn after tech stocks’ monster run this year amid the artificial intelligence craze. In fact, Wednesday’s session was the first since 2001 in which the Nasdaq posted a loss exceeding 2.5% while the Dow registered a gain. Within the S&P 500, information technology and communication services were the two worst performing sectors in the session. TECHNICAL OUTLOOK – Both the Dow and S&P is above the 14, 21 day moving average.
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Crude Oil: Oil prices climbed about 2% on Wednesday on a bigger-than-expected weekly drop in U.S. crude stockpiles and as a weaker U.S. dollar overshadowed signs of lower economic growth in China. In the U.S., the Energy Information Administration said energy firms pulled 4.9 million barrels of crude from storage during the week ended July 12. In U.S. refining news, the diesel and 321- crack spreads, which measure refining profit margins, fell to their lowest levels since December 2021 and January 2024, respectively. China, the world's top oil importer, saw its economy grow 4.7% in the second quarter, official data showed earlier this week, the slowest growth since the first quarter of 2023, capping crude price gain
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Metals: Gold prices are trading modestly down at midday Wednesday on some routine profit taking from the shorter-term futures traders after hitting an all-time record high overnight at $2,487.40, basis August Comex futures. Meantime, silver prices are sharply lower. Still, if gold continues to rally in the near term silver will likely tag along. The main underlying bullish fundamental for gold remains in place: ideas of lower interest rates coming from the major central banks yet this year, including from the Federal Reserve. Technically, August gold bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $2,500.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,400.00. September silver futures bulls have the overall near-term technical advantage, but prices today scored a bearish “outside day” down on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at the July high of $32.015. The next downside price objective for the bears is closing prices below solid support at the June low of $28.90. TECHNICAL OUTLOOK – Gold and silver are above 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
Futures and options trading involves substantial risk and is not suitable for all investors. Therefore, individuals should carefully consider their financial condition in deciding whether to trade. Option traders should be aware that the exercise of a long option will result in a futures position. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
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