Morning Brew July 8 2024

Good morning,

We are entering a slow week in terms of data - that does not necessarily imply it will be boring though

Friday was quite exciting as predicted:

While the Non-Farm Payroll came a little higher, the surrounding data was quite bad, raising dovish hopes. Interest rate traders predict 53 basis point cuts in 2024 and the probability of a September cut is 80%.

Equities mainly rose. The Dow +0.2%, The S&P gained 0.5% and the Nasdaq 0.9%. This made for a great week, the Nasdaq gained 3.5%, the S&P 2% and the Dow 0.7%. Small Caps again fell behind with a loss of 1% for the week. Overall volumes were rather high given the US bridge holiday at 9.7 billion shares.

Meta rose nearly 6% on Friday, Apple 2.2% and Tesla 2%, Nvidia and Broadcom could not convince and fell 1.9 and 1.5% respectively.

Outside of the US, the GER40 rose 1.4% for the week, the EU Stocks 1.7% and the Nikkei 2.2%.

The stock to watch in Europe may be Rheinmetall today, the stock traded 5% lower on Friday but confirmed the biggest contract ever in Italy to the tune of €20 bio over the next 15 years,

In FX we saw strong moves, , the USD Index fell to a three-week low, GBPUSD rose to above 1.28, EURUSD 1.0835 and USDJPY 160.90.

Gold and Silver moved strongly as we had thought, Silver gained 2.7% and Gold 1.5%. Technically both have upside potential as Kim pointed out last week. Bloomberg estimates solar panels will require more than 25% of the world’s silver production in 2024. Bitcoin closed 3.3% lower, ETH lost more than 5%.
This morning there is some profit taking in precious Metals, Gold is now 2382 and Silver meandering the 31. Bitcoin and ETH are 55400 and 2915, Equities are also under a little pressure, likely as an initial fallout of the French Election.

For an in depth analysis of the week ahead check out Charu`s Chartbook

This week there are little key data releases, the exception being the US CPI on Thursday BUT there are sources of volatility
- French Election Fallout
- UK Election Fall out – the labor government has already taken steps to improve relations with the EU and ending the agreement with Rwanda
- Powells Testimony on Tuesday and Wednesday
- Peace talks in Israel
- Will Joe Biden remain in the race? The pressure is mounting
- Earning Season kicks off with the Delta Airlines and Pepsi on Thursday and 4 large banks on Friday.
- US CPI on Thursday

Monday
- Data  DE Trade, EU Sentix
Tuesday
- Data Jerome Powell gives his semi annual testimony in Congress, Michael Barr speak
Wednesday
- Data China CPI & PPI Powell continues his semi annual testimony

Thursday
- Data DE HICP UK  GDP, US CPI & Initial Jobless Claims, Cook & Bostic speak
- Earnings: DNB  Delta Airlines, Pepsi Cola
Friday
- Data Sweden & France CPI US PPI & University of Michigan Sentiment

- Earnings:  Bank of New York Mellon, Citigroup, Wells Fargo, JP Morgan Chace