Asian equities chilled overnight with the Shanghai -1.90% but +14% m/m – Chinese Banks reportedly eased back on asset purchases.
U.S. Equites followed China lower overnight, the SP500 -0.62% , Dow J -0.78%, Russell 2000 -0.90%, and the NASDAQ -0.49%. The NASDAQ begs the question whether or not it’s even an index anymore, when really only 5 stocks out of 3300 in the Composite drive the index? It’s an honest question. Either way we remain bullish of tech in Q3 2020 and bearish of US Small Caps.
Europe– Stronger industrial production out of France and Italy leant a hand to Euro stocks overnight. Europe “green” across the board. Ger, UK, France, Italy, Swiss indices leading the way ranging from +0.50 – 0.70% for the lot.
Oil/Energy- finally broke lower overnight, -1.54% following a negative session yesterday as well. +7M bbl build in weekly inventories but most notably the acceleration in US Covid-19 cases continue to spike and cast shadows over demand and economic recovery. As a matter of fact, the Int’l Energy Agency issued a warning pertaining to demand outlook due to Covid-19. However, we’re still buyers of Crude Oil at the low end of the range through Q3 2020 OR until further notice. We’re also going to be taking a hard look at Nat Gas on the current pull-back following the more than 40% rise off of its contract lows. Nat Gas looking as if its attempting to bottom, but remains bearish trend.
Metals- Continue to do their thing…Copper is immediate overbought but remains bullish trend.
***UPDATE- as I type this, Gilead touts results of Remdesivir vaccine trial. Stocks and crude oil are bouncing….
Not much else we’re seeing – still looking for our opportunities on the edges – we’ll be in touch hopefully soon.
Econ Calendar for today….June producer inflation data expected to decline, but hold flat y/y.