US open: Futures advance as retail sales unexpectedly rise
Fiona Cincotta July 16, 2021 8:46 PM
US stocks are looking to a firmer end to the week after broadly upbeat earnings and better than expected retail sales.
Dow futures +0.15% at 34758
S&P futures +0.2% at 4370
Nasdaq futures +0.3% at 14844
FTSE +0.11% at 7023
Dax 0% at 15624
Euro Stoxx -0.1% at 4050
A positive end to a choppy week
US futures are pushing higher on the open. Investors are brushing off news that the Biden administration will warn businesses over rising risks of doing business in Hong Kong and instead are focusing on better than forecast retail sales and a relatively upbeat start to earnings season.
The US banks have kicked off earnings season, most beat forecast on both earnings and revenue thanks in part to a surge in deal making. The low interest rate environment combined with businesses eager to reorganize and digitalise has sent deal making to record levels.
Retail sales rose by a better than expected 1.3% MoM in June, up from an upwardly revised -0.9% decline in May and well ahead of the -0.4% drop expected. Retail sales are notoriously volatile and this year this is particularly the case. As a result, its proving difficult to draw any strong trends for the data. The fact that it rose and firmly is a good sign for now. Jerome Powell said that the recovery still had a way to go. This is movement in the right direction.
Looking ahead Michigan consumer confidence data will be in focus.
Where next for the Nasdaq?
The Nasdaq refreshed its all time high earlier in the week before easing lower. Yesterday’s selloff took the index through its 50 sma on the 4 hour chart. The price is rebounding after finding support on the ascending trendline dating back to mid May. The MACD’s receding bearish bias is supportive of a move back over the 50 sma and back towards 15000. A break out of the ascending channel could prompt a deeper selloff to 14550.
FX – USD rises, EUR shrugs off inline inflation
The US Dollar is moving higher, extending gains from the previous session. The US Dollar is set to gain over 0.5% this week its strongest weekly gains in over a month, boosted by safe haven flows as delta cases rise and elevated inflation prompts speculation of the Fed tightening policy.
EUR/USD hovers around 1.18. Final Eurozone CPI came in as expected at 1.9% YoY in June, down from 2% in May. Concerns over the spread of the Delta variant are also dragging on sentiment for the common currency,
GBP/USD -0.14% at 1.3810
EUR/USD -0.28% at 1.1795
Oil set for 4% losses across the week
Oil prices are edging higher but are set for steep weekly declines. Both benchmarks are looking at losses of over 4% across the week. A compromise at OPEC paves the way for output increases to match surging demand as economies reopen.
Concerns over a rise in fuel inventories is also capping gains, particularly given that the driving season should be ramping up in the US around 4th July holiday.
US crude trades +0.25% at $71.59
Brent trades +0.13% at $73.14
14:00 Fed Williams Speaks
15:00 Michigan Consumer Confidence
18:00 Baker Hughes Oil Rig Count
How to trade with City Index
Follow these easy steps to start trading with City Index today:
- Open a City Index account, or log-in if you’re already a customer.
- Search for the market you want to trade in our award-winning platform.
- Choose your position and size, and your stop and limit levels
- Place the trade.
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
StoneX Financial Pte. Ltd. is not under any obligation to update this report.
Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.