Morning Brew August 4 2023
Senior Relationship Manager
Summary: Key Day Ahead - will yields stabilize?
Interesting setup going into a busy day!
Apple and Amazon beat expectations but with different results. Apple gave up 2% in the aftermarket on slower iPhone sales while Amazon surged from 129 to 140 in late trading.
The BoE delivered the expected 25 BPs hike, in the US, the Unit Labor cost came lower than expected and productivity was much higher.
For the fist time I can recall, the number of initial Jobless claims came precisely at he estimate: 217k expected and delivered.
Indexes stabilized with the US500 now at 4518, the US 30 35290, the US Tech 100 Nas at 15442 and the GER40 at 15932.
US 10 Year Yields are holding at the high of 4.17 and we have released a technical outlook on 10 & 30 year yields and Bunds
The USD Index dropped from a high of 102.80 to 102.40 now, EURUSD is 1.0950, GBPUSD 1.2730 after large swings and USDJPY 142.44.
Gold and Silver are trading at 23.55 and 1936 looking for the break either direction. Oil is strong at 81.75 after Saudi Arabia maintained the production reduction.
Today there are a good amount of companies reporting, German industrial Orders at 8, International PMI, EU Retail Sales (11:00) and most importantly the US Non-Farm Payroll (14:30)
Make sure to monitor the 10 Year rates, the best way without access to Reuters or Bloomberg is to watch the 10 Year Treasury Future ZNc1. Higher borrowing cost may be the tipping point for the Soft Landing scenario.