Global Economic Daily - 21/06/2024
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Quote of the Day: We cannot live only for ourselves. A thousand fibers connect us with our fellow men. – Herman Melville
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Equities: Stocks had a mixed day coming off of a federal holiday on Thursday. The?S&P 500?pulled back on Thursday?after briefly passing the 5,500 level for the first time ever as market bellwether Nvidia gave up earlier gains. The broad market index fell 13.86 points to end at 5,473.17. Earlier in the session, the S&P 500 rose as much as 0.34% to hit a new high. The?Nasdaq 100?dropped 156.56 points to finish at 19,752.30. The?Dow Jones Industrial Average?jumped 299.90 points to close at 39,134.76. Stocks are headed for a winning week, with the S&P 500 and Nasdaq notching new records. The stock market was closed Wednesday for the Juneteenth holiday. Excitement around AI has continued push the market higher in recent weeks even as some on Wall Street raise concern over a lack of?market breadth?outside the technology behemoths that could?worsen. Meanwhile, fresh?economic data?contributed to?the argument that the economy is softening. That data included higher-than-expected weekly jobless claims and poor housing starts and permits. A reading of the Philadelphia Fed Manufacturing Index also came in below estimates. TECHNICAL OUTLOOK - The S&P is above the 14, 21 day moving average, while the dow is now at the average.
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Crude Oil: Oil futures climbed on Thursday after the U.S. Energy Information Administration reported a draw on crude oil and data showing a cooling jobs market that stoked hopes the Federal Reserve could cut interest rates soon. Crude inventories fell by 2.5 million barrels in the week ending June 14 to 457.1 million barrels, the EIA said. There was no WTI settlement on Wednesday because of a U.S. public holiday, which kept trading largely subdued. The more active August contract was up 60 cents at $81.31. Oil prices are also likely to remain supported by a growing geopolitical risk premium driven by conflict in the Middle East. Israeli forces?pounded areas in the central Gaza Strip overnight, while tanks deepened their advance into Rafah in the south. However, expectations of an inventories build appear to be overshadowing fears of escalating geopolitical stress for now. A summer uptick in oil demand, refinery runs and ongoing weather risks added to extended production cuts by the OPEC producer group mean that oil balances should tighten and inventories should begin to draw during the summer months. TECHNICAL OUTLOOK – The Crude is above the 14, 21 day moving average.
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Metals: Gold prices are firmly up and silver sharply higher in midday U.S. trading Thursday. Both metals touched nearly two-week highs. Perceived bargain hunting and technical buying are featured as gold and silver chart postures have turned more bullish late this week. The precious metals bulls are also more confident following the weaker U.S. retail sales report earlier this week. Switzerland’s central bank Thursday unexpectedly cut its main interest rates for a second consecutive time to 1.25%. This news also benefited the metals market bulls, on ideas of easing monetary policies from the world’s major central banks. In other overnight news, China bank officials kept one- and five-year prime loan rates unchanged at 3.45% and 3.95%, respectively. This follows the central bank decision to leave its benchmark one-year medium term lending rate at 2.50% earlier this month. Technically, August gold bulls have the overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at the June high of $2,406.70. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the June low of $2,304.20. July silver futures bulls have firm the overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at $32.00. The next downside price objective for the bears is closing prices below solid support at the June low of $28.73. TECHNICAL OUTLOOK – Gold and silver are above the 14, 21 day moving average.?
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