Investing.com | Mar 06, 2019 08:30
European stocks and futures on the NASDAQ 100 edged lower this morning after a mixed Asian session amid lack of progress on U.S.-China trade negotiations and heightened worries of a global slowdown.
The STOXX Europe 600 slipped alongside automobile producers, though household goods helped the index offset a deeper drop.
After a three-straight hour advance, U.S. future contracts staggered in the fourth hour, with SPX futures reaching a high of 2788.62 at 3:13 EST before slipping away from the 2,800 psychological level that has kept bulls at bay for the last seven sessions.
Earlier, in the Asian session, China’s yen throughout the session likely to have put further pressure on prices.
h2 Global Financial Affairs/h2In yesterday’s U.S. session, equities extended a retreat.
The incoming deal between the U.S. and China and focusing on the scarcity of concrete details.
Adding to broad skepticism: a report by the host of popular CNBC program Mad Money, Jim Cramer, argued U.S. President Donald Trump could take advantage of China’s weakening economy to pressure the Asian country into a deal balanced in favor of the U.S. interest, thereby ignoring the more immediate need, by the market, of trade stability. Besides, we have been warning of the potential effect, on trade negotiations, of a slowing Chinese economy since mid-last year.
On a more positive note, data beats on U.S. warned the company's “industrial free cash flow in 2019 will be negative.”
The stock of the conglomerate powerhouse plunged 7.71% after Culp's warnings, to close 4.72% lower. Technically, short-term bulls since the December bottom are clashing with medium-term and long-term bears, beautifully depicted by the 200 DMA (red).
UST 10-year Daily Chart
Meanwhile, the yield on 10-year Treasurys edged lower for a fourth day. However, the February range’s high, aided by the 50 DMA, provided support, propelling yields well off their lows, where they formed a hammer. The recent boost in demand signals market defensiveness, which led Morgan Stanley analysts to forecast that yields will drop to as low as 2.35% by year end. We had expected a further Treasury rally, which would have also pushed yields lower. However, last week’s three-day jump resulted in a pattern failure, complicating the picture.
As yields bounced back, they allowed the dollar to subside for the first time in six days, giving up intraday highs—though the greenback kept fluctuating between gains and losses.
The British pound slipped for the fifth consecutive session on mounting concern that Prime Minister Theresa May's Brexit plans will suffer another defeat in Parliament. Technically, the price is showing a correction within a medium-term uptrend.
The GDP data spurred bets on upcoming interest-rate cuts and fed into fears of a global slowdown.
keep rates on hold on Wednesday due to lingering uncertainty on housing and investment, though Governor Stephen Poloz is expected to stick to his message that borrowing costs eventually need to head higher.
Canadian Labor Productivity is released Wednesday.
Canadian Exports, Imports and Trade Balance are released Wednesday.
Canadian Ivey PMI is released Wednesday.
Stocks
Canada’s S&P/TSX Composite closed up 0.30 percent Tuesday.
Currencies
The Canadian loonie was down 0.22 percent against the U.S. greenback early Wednesday, trading at 0.7475.
Bonds
Canada’s Canada 10-Year was down early Wednesday at 1.849, a 1.65-percent decrease.
Commodities
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