Market Quick Take - August 3, 2020
Stocks ended July in mixed fashion, with the major US indices still perched near the highs for the cycle, while Europe is struggling into the close of the month, held down in part by the very strong euro in July. As the often-volatile month of August gets underway, earnings season is still a focus, if less so, while US employment data and the course of COVID-19 virus resurgence are in focus this week.
Banks are struggling, big tech earnings review, TikTok would be a scoop for Microsoft
Banks are wobbling with disappointing earnings and a bleak outlook while earnings from big US technology companies last week gave investors a path to more gains in equities. Microsoft is continuing its talks with ByteDance to acquire TikTok in the US, Canada, Australia and New Zealand following the Trump administration's ban on TikTok in the US.
Macro Dragon: Welcome to WK # 32... RBA, Final PMIs, ISMs+ NFP, Biden's VP
Macro Dragon = Cross-Asset Daily Views that could cover anything from tactical positioning, to long-term thematic investments, key events & inflection points in the markets, all with the objective of consistent wealth creation overtime.
Market Quick Take - July 31, 2020
The four US megacap companies Apple, Alphabet, Amazon, and Facebook were out with blowout results after the close yesterday, bringing a massive new boost to US equity futures in late trading. The success of these monopolistic companies is clearly not a sign of the health of the overall economy, and bond yields continuing lower suggest a darkening outlook. The USD, meanwhile, notched new lows for the cycle.
FX Update: USD focus on stand-off over next round of stimulus.
The FOMC meeting was largely a non-event, though Fed Chair Powell was right in reminding the audience in the press conference that it can only lend, and not spend. On that note, the standoff in the US over the next round of stimulus is an overriding concern. A weak German GDP estimate for Q2 and fears of further moves against the virus resurgence in Europe are hitting risk sentiment and boosting the USD today.
Podcast: Stimulus concerns growing. Earnings mother lode today.
On the call today, we have a look at the rather indifferent FOMC meeting, even if important themes were discussed by Powell during the press conference. Elsewhere, the standoff between the Trump administration and Congress on further stimulus is a prominent concern for markets until a breakthrough is achieved. Today, equity traders should be zeroing in on the mother lode of earnings reports from Apple, Alphabet, Amazon and Facebook - all after the close today.