Wall Street rebounds on soothing words
The White House put a positive spin on the state of US-China trade relations and the Peoples Bank of China reassured companies that the yuan would not continue to weaken. Both of these events helped US indices rebound from intra-day lows to close in the black yesterday. Both the Reserve Bank of New Zealand and the Reserve Bank of India are expected to cut rates today.
US30USD Daily Chart
The US30 index started yesterday’s session weakly, but bounced off two-month lows after The White House comments. It was the first up day in six days
The index regained the 200-day moving average at 25,554 and is now sandwiched between that and the 100-day moving average at 26,270
White House adviser Kudlow said plans are still going ahead for the Chinese trade delegation to come to Washington in September. There are no major data releases scheduled for today.
DE30EUR Daily Chart
The Germany30 index snapped a three-day losing streak yesterday, but not before it had slumped to a more than four month low
The index is still below the 200-day moving average at 11,649 and has closed below it for the past two sessions
German factory orders rebounded strongly in June, rising 2.5% m/m, well above the +0.5% expected. This could bode well for today’s industrial production data, which is expected to show a 0.4% m/m decline in the same month.
WTICOUSD Daily Chart
West Texas Intermediate slid to the lowest level in eight weeks in early trading this morning, constantly pressured by the demand outlook amid an escalating trade war between the US and China
WTI is approaching the 78.6% Fibonacci retracement of the June-July rally at $52.75
The weekly EIA crude stockpiles data to August 2 is expected to show a drawdown of 3.3 million barrels, the latest survey of analysts suggests. That would be the eighth weekly drawdown in a row and could give mild support to oil prices.
