U.S. Indexes Stocks closed higher on Wednesday, with the NASDAQ 100 outperforming as strong earnings from CoreWeave (CRWV), Lumentum (LITE), Super Micro Computer (SMCI) and Nebius (NBIS) supported the AI trade. The equal-weight S&P 500 (RSP) posted more modest gains, while sectors were predominantly firmer. Real Estate, Technology and Consumer Staples outperformed, while Consumer Discretionary, Materials and Communication Services lagged. The major macro event of the session was the July CPI report, which came in line with expectations. The report saw money markets increase confidence in a September hold, while still maintaining expectations for a 25 basis point hike by year-end. Overall, the inflation data gives the Fed greater scope to remain patient, particularly following last week’s weak July jobs report, although it was not soft enough to eliminate the prospect of further tightening later in the year. The Treasury curve bull steepened, led by declines in front-end yields, although the immediate reaction to CPI saw some two-way price action. Elsewhere, the 10-year Treasury Note Auction was not as strong as the previous offering but remained better than recent averages, pointing to healthy underlying demand for duration. In FX, the Dollar initially weakened following the CPI report before gradually paring the move, broadly tracking the recovery in the 2-year Treasury yield. The NZD and CHF underperformed among G10 peers. Energy prices settled little changed amid mixed reporting on the geopolitical backdrop. Pakistani mediators struck a more optimistic tone, suggesting there is scope to extend the 60-day MoU, while Iranian sources pushed back, stating there are currently no discussions over extending the ceasefire between the US and Iran. Meanwhile, both the US and Iran continue to claim control of the Strait of Hormuz, leaving the geopolitical outlook uncertain. Precious metals continued to advance, with increased confidence in a September Fed hold following CPI providing support as front-end Treasury yields declined. Headline CPI rose 0.1% M/M in July, in line with expectations, following the 0.4% decline in June, which had been driven by a notable 5.7% drop in energy prices. The Y/Y rate eased to 3.4% from 3.5%, also matching forecasts. Core CPI rose 0.2% M/M, in line with consensus and accelerating from June’s unchanged reading, while the Y/Y rate cooled to 2.5% from 2.6%, as expected. Overall, the report was encouraging, with both annual inflation measures ticking lower and no upside surprise in the monthly core reading. Money markets subsequently increased the probability of an unchanged rate decision in September to around 60% from 50% beforehand, with the weak July jobs report also supporting the case for patience. Looking at the drivers, shelter rose 0.1% M/M and accounted for around two-thirds of the overall monthly increase in the all-items index. Food prices also rose 0.1%, including a 0.3% increase in food away from home, while energy prices declined 1.5%. Within the core components, prices increased for medical care, airline fares, communication, education and recreation, while motor vehicle insurance was among the major indexes to decline in July. However, there is still plenty of data due before the September 16th FOMC, including another CPI and NFP report, which will further shape rate expectations given the Fed’s continued lack of explicit forward guidance. Policymakers will receive the July Core PCE report before the meeting, with Pantheon Macroeconomics now expecting a 0.16% M/M increase following yesterday’s CPI data, while Oxford Economics looks for 0.2% and Goldman Sachs 0.23%. The August PCE report, however, will not be available before the September decision. Regional Fed inflation measures were somewhat mixed. The Atlanta Fed’s Sticky-Price CPI accelerated to a 3.5% annualised M/M rate from 0.8%, with the core measure also rising to 3.5% from 0.7%. However, the less volatile Y/Y measures were more encouraging, with headline sticky CPI unchanged at 2.8% and core easing to 2.7% from 2.8%. Meanwhile, the Cleveland Fed Median CPI rose 0.3% M/M from 0.2%, while the Y/Y rate was unchanged at 2.7%. The sharp swings in the annualised monthly Atlanta Fed measures warrant some caution, while the more stable Y/Y readings suggest underlying inflation remains relatively sticky but is broadly moving in the right direction. Fed Member Collins said businesses and households in the US north-east were being squeezed by inflation. Collins noted she supported the decision to hold rates in July, describing policy as mildly restrictive, expecting disinflation gradually to be sustained. Ahead, the 2028 voter would back a hike as soon as September if data beforehand supports the decision. On last week’s NFP report, the Boston Fed President said we should not be surprised if there are periods of volatility in the figures. She noted that the overall jobs data is quite mixed and in an “unusual balance”, while risks to inflation are greater with inflation too high. Elsewhere, Oil closed lower by 0.7% while Gold ended the day with a gain of 1.2%.
To mark my 3425th issue of TraderNoble Daily Commentary I am offering a special 2-Year Rate of Euro 2750 for my Platinum Service which includes 1 to 4 updated emails throughout the trading day to demonstrate this value, a monthly subscription over the same period would cost 4440 euro in total This offer represents a 38% discount and is open to both new and existing members. If anyone is interested in this offer can you please email me on bryan@tradernoble.com for details
For anyone following my Platinum Service it made 320 points yesterday and is now ahead by 1270 points for August after closing July with a gain of 8031 points, after ending June with a new record of 10527 points after ending May with a loss of 1104 points, having ended April with a gain of 1730 points, after ending March with a massive gain of 9002 points, having closed February with a strong gain of 5482 points after ending January with a gain of 4757 points, having closed December with a gain of 2599 points, after ending the month of November with a gain of 4542 points, after ending October with a nice gain of 5110 points after closing September with a gain of 3774 points while ending August with a gain of 3362 points after closing July with a gain of 3753 points after closing June with a gain of 3530 points, having closed May with a gain of 3606 points, after closing April with a gain of 7685 points after closing March with a gain of 2254 points while closing February with a gain of 4180 points. January ended with a gain of 2768 points while 1997 points were gained in December. October ended with a gain of 2179 points, after closing September with a gain of 4402 points, following a loss of 301 points in August. July gained 1908 points while June saw a gain of 2074 points. The Platinum Service made a previous record 9619 points in October 2022. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 2300 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 0.0.26% higher at a price of 7748.
The Dow Jones Industrial Average closed 21 points lower for a 0.04% loss at a price of 53,770.
The NASDAQ 100 closed 0.74% higher at a price of 29,743.
The Stoxx Europe 600 Index closed 0.16% lower.
Yesterday, the MSCI Asia Pacific closed 0.6% lower.
Last Monday, the Nikkei closed 0.83% higher at 67,524.
Currencies
The Bloomberg Dollar Spot Index closed 0.16% higher.
The Euro closed 0.08% lower at $1.1525.
The British Pound closed 0.02% lower at $1.3502.
The Japanese Yen rose 0.01% closing at $159.28.
Bonds
U.K.’s 10-Year Gilt closed 1 basis points higher at 4.98%.
Germany’s 10-Year Bund Yield closed 1 basis points lower at 3.16%
U.S.10 Year Treasury closed 1 basis points lower at 4.70%.
Commodities
West Texas Intermediate crude closed 0.72% lower at $82.60 a barrel.
Gold closed 1.2% higher at $4412.10 an ounce.
This morning on the Economic front we have U.K.GDP, Industrial/Manufacturing Production and the Trade Balance at 7.00 am. This is followed by Euro-Zone Manufacturing Production at 10.00 am. Next we have U.S. PPI and the Weekly Jobless Claims at 1.30 pm. Finally, we have a speech from Fed Member Barkin at 1.40 pm and a Thirty -Year Treasury Auction at 6.00 pm.
Cash S&P 500
My S&P plan worked well as the market rose to my 7770-sell level before trading lower to my revised 7751 T/P level and I am now flat. Today, I will again be a seller of the S&P on any further rally to 7780/7810 with a higher 7831 ‘Closing Stop’. If I am taken short, I will have a T/P level at 7749. The S&P will have strong support from 7610/7635 where I will continue to be an aggressive buyer on any tag with the same 7589 ‘Closing Stop’. If I am taken long, I will have a T/P level at 7680. If any of these views change, I will be back with a new update for my Platinum Members.
EUR/USD
I am still flat. The Euro tried to move higher following the release of Wednesday’s CPI before having a small sell-off into the New York close. I am still flat. Today, I will continue to be a buyer on any dip lower to 1.1400/1.1470 with the same 1.1355 ‘Closing Stop’. If I am taken long, I will have a T/P level at 1.1540. I still do not want to be short the Euro at this time.
Dollar Index
No Change: I am still long from last week at an average price of 100.45 with the same 100.60 T/P level. As I go to post the Dollar is trading at a price of 100.00. I will leave my 99.35 ‘Closing Stop’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Russell 2000
The Russell ended Wednesday’s session with a gain of 0.6%, closing at a price of 3045. I am still short the Russell at an average price of 3020. I will leave my 3105 ‘Closing Stop’ unchanged while raising my T/P level to 3005 and reassess if executed. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
FTSE 100
The FTSE never came close to Wednesday’s sell range and I am still flat. Summer trading conditions with volatility almost not existent. I will not chase the FTSE Market lower. The FTSE has short-term resistance from 10920/10020 where I will be a small seller with the same 10125 ‘Closing Stop’. If I am taken short, I will have a T/P level at 10860. I still do not want to be long the FTSE at this time.
Dow Rolling Contract
Frustratingly the Dow just missed Wednesday’s sell range by two points before falling over 300 points and I am still flat. The Dow has short-term resistance from 53980/54280 where I will be a seller with a lower 54505 ‘Closing Stop’. If I am taken short, I will have a T/P level at 53630. I no longer want to be a buyer of the Dow at this time. If this view changes, I will be back with a new update for my Platinum Members.
Cash NASDAQ 100
Wednesday’s post CPI rally saw the NDX hit my sell rage for a now 29810 short position. Post the market close the NDX sold off to my revised 29680 T/P level and I am now flat. Today, I will again be a seller from 29850/30100 with the same 30305 ‘Closing Stop’ unchanged. I will now raise my T/P level on this short position to 29680. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
December BUND
I am still flat. The Bund never came close to Wednesday’s buy range, trading in a narrow pattern with little or no price action. Today, I will continue to be a buyer of the Bund on any further dip lower to 123.30/124.10 with the same 122.65 ‘Closing Stop’. If I am taken long, I will have a T/P level at 124.75. I still do not want to be short the Bund at this time.
Gold Rolling Contract
I am still flat. Today, I will continue to be a small buyer from 4170/4270 with a higher 4085 ‘Closing Stop’. If I am taken long, I will have a T/P level at 4330.
Silver Rolling Contract
No Change: I will not chase Silver from and will stay flat today to see how the market reacts to last week’s huge run higher. If this view changes, I will be back with a new update for my Platinum Members.
Please Note: There will be no Daily Commentary tomorrow. Any of my calls that are not triggered today and are subsequently executed on Friday will see me return with updated emails for my Platinum Members.
Recent Comments