Archives of “August 2020” month

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US stocks close near session lows. No new record close today

  
Analysis, US Market

Stocks lost steam into the close

The major indices are closing lower on the day and near session lows. The move lower is being led by the NASDAQ index which is down around -0.57%.
Apple today traded above a market capitalization of $2 trillion. That was the 1st stock to have a capitalization over 2 trillion. The level was at $467.77. The price close below that level and $462.83.
Other highlights today include:
  • The S&P and NASDAQ snapped a today winning streak.
  • The Dow industrial average fell for the 3rd consecutive day.
  • The S&P reached a new intraday record up at 3399.54.
The final numbers are showing:
  • S&P index fell -14.83 points or -0.44% to 3374.95
  • NASDAQ index fell -64.383 points or -0.57% to 11146.46
  • Dow industrial average fell -84.64 points or -0.30% to 27693.43

Why the US dollar continues to rebound and what’s next

  
  Analysis
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The pressure is on

Dollar
The US dollar has extended its gains as market participants get caught wrong-footed in a rebound after multi-month lows.
The dollar looked to be breaking down yesterday and today but stabled itself and is making a move to the upside. There are two near term factors to watch:
1) The 20-year auction
The US is selling $25B in 20-year bonds at the top of the hour. Last week there was a strong 10-year sale and a very weak 30-year sale so the bond market is off balance. A higher-than-anticipted yield could boost the dollar further.
2) The FOMC minutes
The Fed is a below-the-radar risk at the moment. The strong belief in markets is that they’re creeping towards doing more for the economy but an improvement in US virus cases, decent economic data, higher inflation and the stock market at record highs might make them slow their roll. If so, the dollar could climb further
Overall, this looks like a position-squaring squeeze in a quiet mid-August market to me but you can’t take anything for granted. If it spills over into a broad risk-off move, then the dollar could have a lot of room to run.
The EUR/USD chart to me looks like a retest of the range break before a further breakout but a close over 1.19 today would add confidence.
EURUSD chart

European shares rebound after yesterdays move lower

  
Analysis, Global Indices

Major indices close near highs for the day

The European shares have rebounded after yesterdays move lower. They also are closing near their highs for the day.  The provisional closes are showing:

  • German DAX, +0.8%
  • France’s CAC, +0.7%
  • UK’s FTSE 100, +0.6%
  • Spain’s Ibex, +0.64%
  • Italy’s FTSE MIB, +0.8%
In the European debt market, the yields are mostly lower with the exception of the UK 10 year which rose by 1.7 basis points:
Major indices close near highs for the day_

Apple shares hit the $2 trillion market cap

  
  Analysis

1st company to reach that milestone..

1st company to reach that milestone..
Apple has become the 1st company to crack the $2 trillion market cap level.
The company was the first to reach $1 trillion market cap back on Aug. 2, 2018.  Amazing.
Apple announced a 4 to 1 stock split effective at the end of the month.
On July 31, Apple surpassed Saudi Aramco to become the world’s most valuable publicly traded company.
There is nevertheless some resistance against the area (around $467.77).
PS Amazon and Microsoft have market caps at $1.6T BTW.

US dollar springs to life

  
  Analysis

No headlines behind the move

No headlines behind the move
USD/JPY is at the highs of the day, up 26 pips to 105.67 after falling as low as 105.10 in Asia.
The gain in the pair is part of a broad US dollar move higher. The euro, pounds and Swiss franc are all at session lows. Precious metals are also getting hit.
There is no correlation with the move and equities (very low volume this week) and bonds. There haven’t been any headlines driving the move but we’re coming up to the London fix.
It’s early but watch for this move to spread but I see it as a technical move so far with the euro breaking the daily range.
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