Archives of “September 21, 2020” day

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US household net worth rose by record $7.61 trillion in 2nd quarter

  
  Analysis

Stocks, small credit growth

the Federal Reserve is reporting that the 2nd quarter US net worth grew to $118.9 trillion. That is up $7.61 trillion in the 2nd quarter. The household net worth is a record

  • Real estate value gained $0.5 trillion
  • federal debt rose by record 59% in the 2nd quarter
  • biggest drop ever in consumer credit outstanding
  • consumer credit fell by 6-6.8%
  • mortgage debt rose by 3%
  • biggest quarterly gain ever and household net worth
  • equity values rose by $5.7 trillion
That’s the good news. The not so good news is that the gains in the 2nd quarter offset Covid 19 related losses in the 1st quarter putting households slightly above end of 2019

European equity close: German stocks fall most since March

  
Analysis, Global Indices

Closing changes for the main European bourses

It was an ugly one in Europe with Germany leading the way lower:
  • DAX -4.6%
  • UK FTSE 100 -3.5%
  • French CAC -3.9%
  • Italy MIB -3.6%
  • Spain IBEX -3.6%
This is an ugly-looking candle but German stocks still haven’t given back the August gains.
DAX chart
The picture is bleaker in France, where the CAC-40 is threatening the worst levels since June and has come nowhere close to retracing the March move.
CAC 40

US Secretary of State Pompeo: Imposes new sanctions on Iranian defense ministry

  
  Analysis

Pressure continues to be allied to Iran

US Secretary of State Pompeo is announcing new sanctions on Iranian Defense Ministry. The sanctions are focused on producers of Iran’s missile program including 2 individuals it says are central to Brands uranium enrichment operations.
US Defense Secretary Esper adds that US stands ready to respond to future Iranian aggression.
US commerce Sec. Ross says US at 5 Iranian scientists to sanctions list.

OPEC watching Libya oil restart closely, needs to see if sustained

  
Analysis, Crude

Libya could tip the market into oversupply

Libya is a major wild card in the global oil market.
In late 2018, Libya was producing 1.2 million barrels of oil per day. That fell to 800K bpd at the start of this year as the civil war ramped up. Currently, exports are minimal because of a blockage by Haftar’s forces.
The general announced that exports could resume under a revenue-sharing deal but it’s not clear how much crude is going to move.

China will not approve current agreement to sell TikTok’s US operations – report

  
  Analysis
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Global Times report

From the Global Times’ Hu Xijin:
Based on what I know, Beijing won’t approve current agreement between ByteDance, TikTok’s parent company, and Oracle, Walmart, because the agreement would endanger China’s national security, interests and dignity.
Hu is a mouthpiece for China so this is a strong hint. It was just starting to look like the US would approve it.
Beijing has decided that the US can pull the plug. They might be angling to punish US companies in response.

Dollar erases losses as risk aversion grips

  
  Analysis

The greenback pares losses from earlier in the day

EUR/USD H1 21-09

The dollar is nudging a little higher on the session and has erased earlier losses against most major currencies barring the Japanese yen. This comes as we see the risk-off mood accelerate with the DAX now sliding by 2% and US futures down by a little over 1%.
Despite USD/JPY taking a crack under its 31 July low @ 104.19, the greenback is also seeing some inflow for now as risk aversion grips the market.
For EUR/USD, we are seeing price action challenge some key near-term levels with the confluence of the 100 and 200-hour MAs @ 1.1839-40 called into question.
Keep below that and the near-term bias switches to being more bearish instead. However, key daily support closer to 1.1750 is still holding and that helped to stop the downside push seen last Thursday as well.
Buyers defended the 200-hour MA (blue line) on Friday but amid the risk-off mood, sellers are trying to push their own agenda on the session now.

UK’s Shapps on coronavirus situation: We are at a very critical moment

  
  Analysis

Comments by UK transport secretary, Grant Shapps

  • We are just a few weeks behind Europe
  • We will hear from PM Johnson on next steps this week
  • Unless people follow rules, we will end up back where we don’t want to be in
  • We must keep schools open
The virus situation in the UK is adding to headwinds for the pound alongside the negative Brexit developments over the past few weeks.
UK
The chart certainly doesn’t paint a pretty picture and amid consideration to reintroduce lockdown measures, it will put a dent on the economic recovery in recent months.
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