People’s Bank of China open market operations are one tool used to manage liquidity
- rates may be cut this month reports the CSJ
—
China Securities Journal is a national securities newspaper – part of official Xinhua News Agency.
Archives of “Economy” tag
rssDollar falls after 50 basis point cut by the Fed
Stocks reverse losses
The dollar is falling after the 50 BP cut by the Fed:
EURUSD: The EURUSD has moved up to retest the highs from yesterday at 1.1184 and stalled the price has backed off a bit (into the mid 1.1160s).
USDJPY: The USDJPY is sitting in the range after a small dip to new session lows. The price moved to 107.55. The lows from yesterday are down at 107.350 and 107.396. The price is moving higher (or slow to move lower) as “risk on” flows are helping that pair
GBPUSD: The GBPUSD is moving to a new session high and looks toward the falling 100 hour MA at 1.28417. The new high for the day reached 1.28235.
AUSUSD: The AUDUSD has moved to a new session high continuing the run after the RBA rate decision. The price is looking toward the 100 bar MA on the 4-hour chart at 0.66386. Earlier today, the price extended above its 200 hour MA at 0.65743 for the 1st time since Feb 17th.
Dow closes up over 5% on the day
Major indices close at session highs.
The Dow had the biggest point gain ever, and in the process moved higher by over 5% on the day. The S&P index broke a 7 day decline and rose 4.61%. The NASDAQ index was a laggard with only a 4.5% gain.
The final numbers are showing:
- The S&P index up 136.27 points or 4.61% at 3090.47. The S&P index closed above its 200 hour moving average at 3048.38. Now the price is above that moving average the next target would be the 100 day moving average at 3168.69
- The NASDAQ index is ending the day up 384.797 points at 8952.16. That is a gain of of 4.49%. Technically, the price moved above its 100 day moving average at 8828.31. Its 50 day moving average looms ahead at 9245.93.
- The Dow industrial average is closing up 1293.9 points or 5.09% at 26703.26. Although the gain was the biggest point gain on record, the index still remains below its 200 day moving average at 27241.99.
Some of the bigger gains include:
- Tesla, +11.46%
- Costco, +9.95%
- Apple, +8.85%
- Gilead, +8.69%
- Twitter, +7.92%
- Walmart, +7.59%
- UnitedHealth, +7.04%
- Microsoft, +6.67%
- Citigroup, +6.56%
- Travelers, +6.56%
- Merck, +6.3%
- Amgen, +6.28%
- Target, +5.9%
- Intuit, +5.87%
- Verizon, +5.82%
- MasterCard, +5.73%
- Visa, +5.53%
- Home Depot, +5.45%
Losers on the day include:
- Lyft, -3.12%
- Square, -3.10%
- First Solar, -1.92%
- Chewy, -1.83%
- Deutsche Bank, -1.3%
- Alcoa, -1.15%
- Daimler, -1.09%
- FedEx, -0.75%
- Chipotle, -0.71%
- Papa Johns, -0.5%
- United Airlines, -0.47%
Global central bank co-ordinated interest rate cut coming on Wednesday 4 March
A coordinated global interest rate cut by the top central banks will happen this Wednesday, March 4.
- So says economist for the U.S. bank lobby Bill Nelson, chief economist at the Bank Policy Institute
Nelson, formerly at the Federal Reserve (worked on the Fed’s responses to the 2007-2008 financial crisis):
- It will happen before the U.S. stock market opens, either 7 a.m. or 8 a.m. ET (1200 or 1300 GMT)
- It will be half a percentage point at least
- “The only way to get a positive market reaction is to deliver more than expected”
- will include “forward guidance”
Here is the link for more: Don’t keep your powder dry
Bloodbath : Major indices get hammered. All 3 major indices down -4.4% on the day
Major indices lose 1% additional in the last 15 minutes of trading on major liquidation
the major indices in the US get hammered once again with the Dow, S&P and Nasdaq indices all lower by -4.4%
The S&P and Dow had there worst point drop in history (not % though). Major indices all closed in correction (down over 10% from the highs).
The final numbers are showing:
- S&P index, -137.89 points or -4.42% at 2978.51.
- The NASDAQ index -414.29 points or 4.61% at 8566.48.
- Dow industrial average 1192.27 points or -4.42% at 29765.33
Year to date, the
- Dow is down -9.71%
- S&P is down -7.8%
- Nasdaq is down -4.53%
From the high last week, the major indices are showing:
- NASDAQ index -13%
- S&P is down -12.30%
- Dow is down about 12.9%
The Vix, often called the fear index has moved up to 38.5. That surpasses the 36.2 high from December 2018. That’s the highest level since February 2018. The highest volatility index going back to 2015 moved up to 50.3 and 2018 and 53.29 and 2015.
The good news is that the European stock markets are closed
German DAX, -3.1%. France’s CAC down -3.8%
The good news for the European stock markets is that they are close for the day. Each of the major indices had sharp declines. Sometimes closing feels good. The provisional closes are showing:
- German DAX, -3.1%
- France’s CAC, -3.2%
- UK’s FTSE 100, -3.5%
- Spain’s Ibex, -3.8%
- Italy’s FTSE MIB, -2.6%
To give an idea of the year to date performance of the major indices :
- Germany, -6.65%
- France, -7.6%
- UK FTSE 100, -9.7%
- Spain’s Ibex, -5.6%
- Italy’s FTSE MIB, -2.8%
Comparing to the US market year-to-date:
- Dow industrial average, -7.6%
- S&P index, -5.63%
- NASDAQ index -2.42%
In Asia the year-to-date’s are showing:
- Japan’s Nikkei, -7.22%
- Hong Kong’s Hang Seng index, -5.01%
- Australia S&P/ASX 200 -0.39%
- China’s Shanghai index -1.93%
In other markets as London/European traders look to exit:
- gold is trading up $12.80 or 0.78% at $1653.72
- WTI crude oil futures are trading down $-2.08 or -4.25% of $46.66
In the US stock market the snapshot of the major indices currently shows:
- S&P index -69.3 points or -2.22% of 3047.44
- NASDAQ index -221.2 points or -2.46% at 8759.96
- Dow -578 points or at -2.17% at 26371
In the US debt market yields are sharply lower with the 2 year down -8.9 basis points. The 10 year is down -5.8 basis points.. The 2 – 10 yield spread has widened to 20.42 basis points from 17.24 basis points yesterday on increasing expectations that the FOMC will be forced to lower rates
In the European debt market, yields are mixed with German, France, and UK yields lower while Spain, Italy, Portugal yields are higher (flight to safety and out of the riskier countries):
In the forex market, the EUR is the strongest (and got stronger in the session). Germany did say earlier today that they would contemplate more fiscal stimulus and technicals improved. The EURUSD did run into resistance against the 1.100 level however.
The weakest currency is the CAD as oil continues to get hammered. The GBP and USD are also weaker on the day:
The front end is pining for Fed cuts
The bottom continues to fall out
US 2-year yields are now trading more than 40 basis points below Fed funds. The odds of a March 18 cut in the OIS market have risen to 35% from 6% last Thursday.
Many market participants are deciding that they would rather get 1.14% for the next two years than hold stocks. If you believe this is going to be a pandemic, that’s entirely reasonable because the Fed will cut to zero and the dollar is always does well in times of trouble.
It’s incredible how the thinking in markets can go from ‘return on capital’ to ‘return of capital’ in a few days.
US Major indices down hard again (For us nothing new ………..as expected )
Dow and S&P down over 3%. 4th day of declines in a row
The US stocks are closing down sharply for the 2nd day in a row . The Dow and S&P have the worst 2 day decline since February 2018. The Dow has plunged more than 1900 points in 2 days. The Nasdaq index also moved into and closed in the red for the year (below a 8972.60).
The final numbers are showing
- The S&P index fell 97.68 points or -3.03% at 3128.21. The high reached 3246.99. The low extended to 3118.77
- The Nasdaq index fell -255.66 points or -2.77% at 8965.61. It’s high reached 9315.25. The low extended to 8940.488
- The Dow fell 879.44 points or -3.15% at 27081.36. The high reached 28149.20. The low extended to 26997.62.
After the close, Disney announced that is the CEO Bob Iger would be stepping down. He will be replaced by Bob Chapek effective immediately.
European shares end the session with sharp declines
German DAX -1.8%
The major European shares are ending the session with sharp declines. For the year, the major European indices are also in the red. A look at the provisional closes are showing:
- German DAX, -1.8%
- France’s CAC, -2.0%
- UK’s FTSE 100, -1.9%
- Spain’s Ibex, -2.4%
- Italy’s FTSE MIB, -1.4%
For the year, changes are all in the red led by a 7% decline in the UK FTSE 100.
- German DAX, -3.4%
- France’s CAC, -5%
- UK’s FTSE, -7%
- Spain’s Ibex, -3.1%
- Italy’s FTSE MIB, -1.6%
In other markets as the European/London traders look to exit are showing:
- Gold is still negative. It is trading down $10.80 or -0.65% at $1648.10. The spot price tried rebound and move higher on the fall in stocks, but seems to have sellers above. Recall that in yesterday’s trade, there was a large seller reported in the futures market which helped push the price lower in the New York afternoon session
- WTI crude oil futures are following the risk off sentiment with the contract trading down -$0.89 or -1.7% at $50.54. The price is not far off the low at $50.37. The high reached $52.02
In the US stock market, the NASDAQ is leading the charge to the downside. It is currently down -100 points or -1.11% and 9116.
- Dow -308 points or -1.11% at 27653
- S&P index -34.5 points or -1.07% at 3191
- Nasdaq down -100 points or -1.11% at 9116
Dow tumbles more than 1000 points. Worst day since Feb 8, 2018
S&P worse day since December 2018
The Dow is closing down over 1000 points on the day. It is the workstations February 8, 2018. The S&P index at its worst day since December 2018. The Dow, S&P and Nasdaq each fell over 3.3% on the day with the NASDAQ hit the hardest at -3.71%.
The Dow and the S&P are now negative on the year:
- Dow -2.02%
- S&P index, -0.15%
- The Nasdaq index is still up on the year at +2.77%
The final numbers are showing:
- S&P index -111.82 points or -3.35% at 3225.93. The low price for the day reach 3214.65. The high extended to 3259.81.
- Nasdaq index fell minus 355.309 points or -3.71% at 9221.28. The low for the day reached 9166.00. The high reached 9322.879.
- Dow fell -1031.33 points or -3.56% at 27961. The low for the day reached 27912.44. The high for the day was up at 28402.93
Big losers on the day include:
- United health, -7.87%
- AMD, -7.83%
- Tesla, -7.49%
- Schlumberger, -7.4%
- Nvidia, -7.13%
- Delta airlines -6.31%
- Twitter, -6.29%
- Wynn Resort, -6.03%
- Intuitive Surgical -5.38%
- Morgan Stanley, -5.21%
- Charles Schwab, -5.19%
- FedEx -5.16%
- Citigroup, -5.10%
- American Express, -4.97%
- Cisco, -4.95%
- Visa, -4.82%
Are there any winners today?
- Gilead, +4.66%
- US steel, +1.73%
- Chewy, +1.3%
- First Solar, +1.25%
- Verizon, -0.3%. Verizon was the strongest of the Dow 30 stocks
- General Mills only fell -0.37%