Erik Schafhauser Zürich Erik Schafhauser Zürich Erik Schafhauser Zürich

Morning Brew July 1 2024

Morning Brew 1 minute to read
Erik
Erik Schafhauser

Senior Relationship Manager

Summary:  Welcome to the second half of 2024


Good morning,

The French election saw the far right and the far left ahead and make for an interesting next round on the 7th of July. The Euro and European Indexes seem to be happy with the result even if the reasoning is not fully obvious. Euro gained app 0.5% against the US Dollar and the Swiss Franc, the Eurostoxx 50 is trading 1.4% higher in the Future and the GER40 app 1%.  The France 40 is not yet open for trading.

The Personal Consumption Expenditure (PCE) was released in line with expectations at 2.6% for both "normal" and "core." The Chicago PMI and the University of Michigan reports came in stronger than expected. We saw the second-highest volumes of the year in the US, mainly driven by position adjustments for the half-year end and index changes.

The Dow lost 0.1%, the S&P 0.4%, and the Nasdaq 0.7% for the day. For the first six months of the year, the Russell 2000 gained 0.56%, the Dow Jones 3.9%, the S&P Equal Weight 4%, the S&P 500 15%, and the Nasdaq 19%. The DAX is up 8.9% this year, and the Euro Stoxx 50 is up 8.2%.

As for the stock of the day, Nike fell nearly 20% on Friday due to a gloomy outlook. For the first half of the year, the standout performers are the big tech stocks: Nvidia +149%, Microsoft +18.8%, Alphabet +30.4%, Apple +9.4%, Meta +42.5%, and Super Micro Computer +188.2%.

Gold closed at 2326, slightly down, while silver managed a gain of 0.6% after trading as high as 29.60. Bitcoin lost 2% on Friday but is up 43% this year, and Ethereum is up 1.7% and 48%, respectively. Over the weekend, Bitcoin gained 5% and seems to be breaking out of the descending channel in charts, we remain in the larger broad 60-70k range we have been trading since March

US 10-Year Yields closed the week at 4.34%, starting the year below 3.9%. The USD Index was 105.85 vs 101.20.

FX was calm on Friday, with the majors moving around 0.1%. USD/JPY held near 161.

This week, we kick off the second half of the year, and it will be an interesting one:

  • Europe will need to digest the French Election and the Inflation Data on Tuesday.
  • The US will have Powell speaking on Tuesday, the 4th of July holiday, and the Nonfarm Payroll on a very illiquid day. Will there be fallout from the presidential debate?
  • The UK Election is scheduled for the 4th of July.

Upcoming Events:

Monday Japan Tankan, DE Inflation, International PMI, US ISM, Canada Holiday

Tuesday EU Inflation, Unemployment, Powell speaks

Wednesday DE Industrial Orders, US Initial Jobless Claims, Fed Minutes, John Williams Speaks

ThursdayUS Holiday, UK Election, DE Industrial Orders

Friday DE Industrial Production, UK House Prices, Swiss FX Reserves, US Nonfarm & Unemployment, Canada Labor Market Data

 

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