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Have a nice Friday everyone. We are trying to end a volatile week on an uptrend as US futures are pointing to decent gains. But it is a mixed picture everywhere. Brexit uncertainty is holding back European stocks and global stocks are on the right track for the second straight week.
Let's review the action.
- The main indices are mostly in the green area with Japan's NikkeI go ahead 0.75%.
- The fate of TikTok's US business is very uncertain, but one thing is clear: President Trump will not budge on its September 15 deadline to close it if an acquisition fails.
- Rio Tinto announced that CEO Jean-Sébastien Jacques and the heads of the top units are out of work because of the controversy surrounding the mining giant Destruction of the ancient Aboriginal heritage intensified in Australia.
- The European stock exchanges were at the start with the Stoxx Europe 600 out 0.2%before ticking up.
- A summer vacation rising up Covid cases means that Europe has once again overtaken the US as a major coronavirus hotspot. The 27-country bloc reported more than 27,000 new cases yesterday. These regional comparisons are hardly perfect measures. The population of Europe is 450 million compared to 330 million in the US. Still, it's not a good trend.
- If you suffered from it Brexit fatigueDo not change the watch face. The chances of a chaotic divorce are increasing as the EU now gives the UK until the end of the month to back off its threat to rewrite the terms of the treaty. Britain is even getting heat from House Speaker Nancy Pelosi to do nothing drastic like endanger Good Friday. The threat of leaving without a deal may be a negotiating tactic, but it carries enormous risks. According to economists at Berenberg Bank, almost two thirds of British exports go to the EU and the US.
- The US futures are in the green this morning trying to make up for some of yesterday's losses. Disappointing unemployment figures and the Senate's failure to vote on a slimmed-down stimulus package at all didn't help stocks yesterday. The Nasdaq almost fell 2%.
- Yesterday's sale came despite an incredible one bullish GDP call from Goldman Sachs, who now predicts the US economy will grow as fast as 35% this quarterfar above the estimates of economists.
- The coronavirus pandemic is devastating the economy of New York City. It also affects the quality of life in the city, complain the largest employers in the region. The top execs at 160 companies, including Citigroup, Mastercard and Nasdaq, sent a signed letter to New York Mayor Bill de Blasio urged him to restore basic services, which were suspended when the outbreak broke out in the city.
- gold is down, trade is down $ 1,950 / ounce.
- The dollar is down.
- Raw is flat with Brent trading nearby $ 40 / barrel.
By the numbers
35%. The consumer is the engine of the US economy, roughly responsible for it 70% of GDP. Goldman Sachs economists are therefore pleased to see that consumer spending picked up in July and August, suggesting that the economic recovery is firmer than previously thought. The rapid recovery in consumer spending is one of the main reasons Goldman is now forecasting a 35% jump in GDP in the third quarter.
-9.4%. The Nasdaq is about half a percent away from returning to the correction area. Since the record close on September 2, the tech-laden index has fallen 9.4% as investors rethink the high valuations of big tech stocks. Apple is down 15.3% high since its September 1st. Tesla is doing worse and crashing 25% from its split-adjusted all-time high reached on August 30th. That is firmly in bear territory. Unfortunately, as we know, trading has been incredibly volatile lately, despite the fact that Nasdaq futures are pointing to a rebound as I write.
4.9%. Quiz Time: Which of these four major exchanges got the best results last month?
B] S&P 500
C] Dow Jones Industrial Average
D] Germany's Dax.
The answer is D. D. Since the second half of August, investors have increasingly turned to European stocks, with the Dax being one of the clear winners. It is plus 4.9% in the last 30 days. The Dow and Nasdaq were in the red over the same period.
Have a nice Weekend. I'll see you here on Monday.