A combination of a weaker than expected PPI and stronger earnings saw the NASDAQ 100 lead Thursday’s Equity gains. PPI came in at +0.1% versus +0.4% expected. This is the slowest headline print since August 2020. Delta Air Lines (DAL) reported its strongest quarterly revenue and earnings to date, driven by robust travel demand that has remained resilient despite concerns of an economic slowdown. The company experienced notable growth in international travel and strong demand for premium seats, such as first class. Additionally, a significant decrease in fuel costs contributed to the airline’s positive financial performance during the three-month period ending on June 30. Walt Disney’s (DIS) board has extended the contract of CEO Robert Iger by two years as the company faces long-term challenges in its film and television businesses. The board’s decision aims to ensure continuity of leadership during the company’s ongoing transformation. Iger returned as CEO in 2022, shortly after retiring, with the goal of restoring the business and finding a suitable long-term successor after the departure of his chosen successor, Bob Chapek. Crude oil prices experienced a breakthrough, surpassing the trading range they had been confined to for around two months, as Brent crude closed above $80 a barrel for the first time since April. The market was influenced by production cuts from OPEC+ and a slowdown in Russian flows, outweighing a significant increase of 6 million barrels in U.S. crude inventories. Additionally, the slower-than-expected growth in inflation and a weaker Dollar alleviated concerns about potential interest rate hikes negatively impacting oil demand. European Markets closed higher. The ECB Minutes showed that Members generally concurred that Interest Rates have reached restrictive territory. Euro-Zone Finance Ministers are set to reach an agreement to phase out energy support measures in their economies and redirect the savings towards reducing budget deficits and assisting the European Central Bank in controlling inflation, according to a draft statement by the Ministers. The statement emphasises the need for gradual and realistic fiscal consolidation to rebuild fiscal buffers following extensive public spending during the pandemic and the energy price crisis. In Asia, Chinese Premier Li Qiang convened a meeting with senior executives from leading technology firms, including Alibaba (BABA), ByteDance, Meituan, and Xiaohongshu, indicating a potential shift in Beijing’s stance on the industry amidst a weakening economy. The meeting, which involved discussions and speeches from the executives, suggests a potential easing of the government’s crackdown on the technology sector. While representatives from JD.com (JD) and PDD Holdings (PDD) submitted written speeches, the meeting signifies a possible change in the regulatory environment for Chinese tech companies. China’s exports experienced a significant decline in June, with a 12.4% drop in Dollar terms compared to the same period last year. This marks the second consecutive month of declines and the largest decrease since the beginning of the COVID-19 pandemic. Exports to the U.S. were particularly affected, with a nearly 24% decrease, marking the 11th consecutive month of declines and the worst result since the start of the pandemic. Imports also slumped by 6.8%, reflecting the weakness of the domestic economy and the impact of the ongoing tech war with the U.S. and its allies. Elsewhere, Oil closed 1.28% higher while Gold closed flat.
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For anyone following my Platinum Service it lost 300 points yesterday and is now down 228 points for July, after closing June with a gain of 2683 points. May closed with a gain of 3205 points. April saw a gain of 3354 points while March closed with a gain of 6168 points. The Platinum Service made 3164 points in February, 4687 points in January 2054 points in December, 4789 points in November and a record 9619 points last October. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1900 points. I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
Equities
The S&P 500 closed 0.85% higher at a price of 4510.
The Dow Jones Industrial Average closed 47 points higher for a 0.14% gain at a price of 34,395.
The NASDAQ 100 closed 1.73% higher at a price of 15,571.
The Stoxx Europe 600 Index closed 0.64% higher.
This morning, the MSCI Asia Pacific closed 0.4% lower.
This morning, the Nikkei closed 0.08% lower at a price of 32,391.
Currencies
The Bloomberg Dollar Spot Index closed 0.8% lower.
The Euro closed 0.8% higher at $1.1220.
The British Pound closed1% higher at 1.3118.
The Japanese Yen rose 0.6% closing at $137.95.
Bonds
Germany’s 10-year yield closed 9 basis points higher at 2.45%.
Britain’s 10-year yield closed 9 basis points lower at 4.43%.
U.S.10 Year Treasury closed 7 basis points lower at 3.78%
%.
Commodities
West Texas Intermediate crude closed 1.28% higher at $76.61 a barrel.
Gold closed 0.1% higher at $1960.10 an ounce.
This morning on the Economic Front we already had the release of German Wholesale Prices which fell 0.2% versus -1.1% expected. Next, we have Euro-Zone Trade Balance sat 10.00 am. This is followed at 1.30 pm by U.S. Import/Export Price Index and PCE. Finally, we have the University of Michigan Consumer Sentiment Index at 3.00 pm.
Cash S&P 500
The benign PPI Report saw the S&P traded the whole of yesterday’s sell range for a now 4505 average short position. We saw no dip at all in yesterday’ s session until after the close when we had a small retracement. With the S&P trading above the top of its Daily Bollinger Band and an RSI reading of 71 I am comfortable in being short here after a difficult month. I have no stop on this position. I will have a T/P level at 4480. If this view changes I will be back with a new update for my Platinum Members.
EUR/USD
The Euro easily broke my 1.1185 resistance level, hitting an overnight high so far at 1.1243. This move higher has me short at 1.1200. With the 14-Day RSI closing at an extremely overbought 74 last night I am comfortable in being short. I will add to this position at 1.1270 with a now higher 1.1325 ‘’Closing Stop’’. I will have a T/P level at 1.1140. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
June Dollar Index
The Dollar closed a further 1% lower yesterday. This move lower over the past 10 days has the Daily Sentiment Index reading in single digits. I bought the Dollar at 99.70. I will add to this position at 99.10 with a now lower 98.45 ‘’Closing Stop’’. I will have a T/P level at 100.50 on this position.
Cash DAX
The DAX traded higher to my second sell level at 16130 for a now 16080 average short position. I will leave my 16205 ‘’Closing Stop’’ unchanged. I will raise my T/P level to 16010. If any of the above levels are hit, I will be back with a new update form my Platinum Members.
Cash FTSE
I am still flat as the DAX never came close to yesterday’s buy range. Ahead of the weekend I will now chase the FTSE higher leaving my 7290/7350. Buy level unchanged, with the same 7235 ‘’Closing Stop’’. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
No Change. I am still a buyer on any dip lower to 34000/34220 with a tight 33895 ‘’Closing Stop’’.
Cash NASDAQ 100
Wrong! I have to admit my analytical abilities are definitely being challenged here as the ‘’Nothing Matters’’ collection of data sets is getting ever more pronounced. The bullish narrative from China reopening this year is gone as Chinese Exports drop again in June. Rate hikes do not matter. Trillion Dollar credit card consumer debt with 22% interest rates? Who cares. Prime rates back to 2007 levels? It does not matter. In my opinion we have to believe a lot of things to buy stocks here. Yet Retail investors continue to pile in. More importantly, we have to believe that the reversal in inflation this time does not produce a recession when every single time it has. Much to my frustration and cost stock prices keep going higher in an environment when we have the most overbought readings in years. Yesterday’s move higher saw the NDX move vertically with no price discovery as we closed outside the top of the Bollinger Band with a 14-day RSI reading of 72. Nobody will ring a bell when the top of this move is in. Signals and charts continue to scream sell. Yesterday I was stopped out of my 15205 average short position at 15505 and I am now flat. Thankfully we have had an excellent last 12 months trading as it gives me the ammunition to fight this insane NDX move. The NDX has further resistance from 15600/15750 where I will again be a strong seller with a 15905 ‘’Closing Stop’’. If this view changes I will come back with a new update for my Platinum Members. .
September BUND
I am still flat. The Bund rallied a further 100 points yesterday. Bund Yields have now fallen 30 basis points since Monday. Given how low Bund Yields are I am reluctant to chase the price of the Bund higher, raising my buy level sightly t0 131.10/131.90 with a higher 130.45 ‘’Closing Stop’’.
Gold Rolling Contract
Just like the Euro above I have had the right view of buying the dip in Gold but I have not been able to get a long position on board. This morning Gold is trading unchanged at 1960. We have short-term support from 1918/1933. I will leave my buy level unchanged with the same 1907 ‘’Closing Stop’’.
Silver Rolling Contract
No Change. I am still a buyer on any dip lower to 23.20/23.90 with no stop.
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