U.S. Equities ended the day near where they started as investors failed to find a catalyst to lift the benchmark stock index to an all-time high. The US Dollar sank and Treasuries rose amid a slew of fresh monetary-policy decisions. The S&P 500 Index closed little changed, within 1% of a record, as gains in software companies offset losses for carmakers. After getting a boost from positive comments on trade by White House economic adviser Larry Kudlow early in the day, equities took a leg down after a report about a U.S. official threatening steeper tariffs against China. The Yen, Pound and Swiss franc led Group-of-10 currency gains after their respective central banks left borrowing rates unchanged. In other news, the U.K. Supreme Court spent three days listening to testimony about the lawfulness of Boris Johnson’s suspension of Parliament. The judges’ questions targeted not whether the Prime Minister’s move to prorogue the legislature was incorrect, but what they could do about it if it was. Their verdict, due early next week, is solely focused on Johnson’s five-week suspension of Parliament but could have wider repercussions if it cuts his options as his Oct. 31 Brexit deadline approaches. The court could venture into new areas, forcing him to recall Parliament. That would allow politicians to return with momentum to stop him. The judicial equivalent of a slap on the wrist — a ruling that the suspension was wrong, but not forcing a return of Parliament nor saying that he can’t prorogue lawmakers again — would allow Johnson to try to send Parliament away a second time.
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For anyone following my Platinum Service it was flat yesterday and is still ahead by 911 points for September, having made 2387 points in August, 1153 points in July, 1346 points in June,1722 points in May, 955 points in April and 1027 points in March. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points
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Equities
The slate of monetary policy decisions, hot on the heels of the Federal Reserve’s Interest-Rate cut Wednesday, comes just as the OECD cut its world growth forecast to 2.9% from 3.2% as intensifying trade conflicts take a toll on confidence. Investors continue to focus on the outlook for negotiations between the U.S. and China as trade deputies from both nations meet.
The S&P 500 closed flat on Thursday at 3006.
Japan’s Topix index closed flat.
India’s Sensex rose 4.3%, after the country cut its corporate tax rate overnight.
MSCI Asia Pacific Index rose 0.4%.
Euro Stoxx 50 closed 0.6% higher as a rally in bank shares pushed the Index higher.
Currencies
Here is a summary of the main Changes in F.X. Markets:
The Japanese Yen strengthened 0.4% to close at 108.05 per dollar.
The offshore Yuan added 0.4% to 7.0757 per dollar.
The Bloomberg Dollar Spot Index declined 0.1%.
The Euro rose 0.1% to close at $1.1044.
Bonds
The yield on 10-year Treasuries dipped to 1.76%.
Germany’s 10-year yield was unchanged at -0.51%.
The UK’s 10-year yield was also unchanged at 0.63%.
Commodities
Oil gained amid contrasting reports about whether Saudi Arabia asked Iraq for crude to supply its domestic refineries. West Texas Intermediate crude rose 0.5% to 58.38 a barrel.
Gold rose 0.3% to $1,497 an ounce.
This morning on the Economic Front we already had the release of German PPI which fell more than the -0.2% expected with a -0.5% print. At 12.00 pm we have the latest Bank of England Quarterly Bulletin and this is followed at 1.15 pm by a speech from the Fed’s Williams. At 1.30 pm we have Canadian Retail Sales. Finally, we have Euro-Zone Consumer Confidence and a speech from Fed Member Rosengren at 3.00 pm and 4.20 pm respectively.
December S&P 500
The S&P which was selling off as I posted yesterday turned round on the back of news reports that trade talks between the U.S. and China were progressing well. The S&P made a high of 3021 on this news before spending the rest of the session trading sideways to lower and go out unchanged at 3006. I am still flat as the S&P never came near my buy level. As today is Quadruple Expiration, volatility can increase especially as these Quarterly trading sessions can be difficult to get an edge. At yesterday afternoon’s high the S&P was close to all-time highs. Both the S&P and Dow remain well above underlying chart support along their 50 Day Moving Averages and it seems only a matter of time before these highs are tested and taken out. Today I will raise my buy level to 2984/2994 with a higher 2976 stop.
EUR/USD
The Euro has closed with a 1.10 handle nearly every day this month as volatility evaporates. I am still flat and I will leave my 1.0970/1.1010 buy level unchanged with the same 1.0945 stop.
December Dollar Index
I am still flat the Dollar and today I will lower my sell level to 98.20/98.60 with a 98.95 stop.
December DAX
The boring sideways actions continues in the DAX as the market waits for the September Contract to expire this morning. I am still flat and I will now raise my buy level slightly to 12250/12320 with a 12195 stop. I still do not want to be short the DAX at this time.
December FTSE
Despite Cable trading at 1.2560 this morning the FTSE is holding in as the market also waits for the September Contract to expire in the next couple of hours. I am not going to chase the market higher and I will leave my 7200/7240 buy level unchanged with the same 7155 stop.
Dow Rolling Contract
It looked like the Dow was going to hit my 26910 buy level yesterday morning before turning around and rallying 300 points to make a high of 27272. I am still flat and I will now raise my buy level to 26800/26950 with a 26710 stop.
December NASDAQ
I am still flat the NASDAQ which was the strongest of the US Indices helped by the fact that Microsoft made new all-time highs. I will now raise my buy level to 7830/7880 with a 7775 stop.
December BUND
After the fireworks of last few weeks all is quiet on the Bund front for the moment. I am still flat and today I will be a buyer from 172.10/172.70 with a 171.75 tight stop.
Gold Rolling Contract
No Change as my only interest in buying Gold is on a dip lower to 1473/1483 with a 1465 stop.
Silver Rolling Contract
I am still flat Silver and today I will raise my buy level to 17.25/17.65 with a higher 16.95 stop.
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