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North American News

US stocks roar higher: S&P 500 rises to the highest since June

  • Big gains for US equity markets

Fear has turned into FOMO. Bear market rallies can be intense.

A strong ISM services report healed recession fears while a drop in the prices paid component cooler inflation worries. Add in impressive equity momentum and it was a banner day, led by tech.

  • S&P 500 up 64 points, or 1.5%, to 4162
  • Nasdaq +2.6%
  • Russell 2000 +1.4%
  • DJIA +1.4%

US factory orders for June 2.0% vs. 1.1% estimate

  • Durable goods orders revised to 2.0% from 1.9% preliminary
  • Factory orders for June 2022 2.0% vs. 1.1% estimate.
  • Factory orders ex transportation up 1.4%
  • Shipments rose 1.1% vs. 2.1% increase in May. Shipments have been up 25 of 26 months
  • unfilled orders rose 0.7% vs. 0.3% in May. Unfilled orders are up 22 consecutive months
  • inventories rose 0.4% vs. 1.3% in the May. Inventories are up 22 of the last 23 months

The durable goods data within the factory orders report showed:

  • Durable goods orders 2.0% revised up from 1.9% previously reported at 0.8% last month
  • durable goods ex defense 0.5% vs. 0.4% in the preliminary report. Last month 0.7%.
  • Durable goods ex transportation 0.4% vs. 0.3% in the preliminary report. Last month 0.5%
  • non-defense capital goods ex air 0.7% vs. 0.5% in the preliminary report. Last month 0.5%

July US ISM services index 56.7 vs 53.5 expected

  • July 2022 ISM services index
  • Prior was 55.3

This is a stark contrast to the S&P Global services survey, which plunged in July.

Details:

  • Business activity 59.9 vs 54.0 expected (prior 56.1)
  • Prices paid 72.3 vs. 80.1 last month
  • Employment 49.1 vs. 47.4 last month
  • New orders 59.9 vs. 55.6 last month
  • Supplier deliveries 57.8 vs. 61.9 last month
  • Inventories 45.0 vs. 47.5 last month
  • Backlog of orders 58.3 vs. 60.5 last month
  • Exports 59.5 vs. 57.5 last month
  • Imports 48.0 vs. 46.3 last month

Commodities

Silver ascends around $20.00 despite improved mood, as US bond yields reverse

  • Silver price clings to the $20.00 figure, despite a risk-on market mood.
  • Upbeat US Non-Manufacturing PMI data keeps investors’ spirits high, that the US could dodge a recession.
  • Fed officials emphasized their commitment to bringing inflation down.

Silver prices are pressing against the $20.00 figure after tumbling on Tuesday due to US dollar appreciation amidst a gloomy market mood spurred by geopolitical tensions between the US and China. Nevertheless, on Wednesday, the white metal stages a comeback, though it’s facing solid resistance with the 50-day EMA lingering around the $20.43 mark. At the time of writing, XAGUSD is trading at $20.00.

Silver recovers as US bond yields retrace from daily highs

Sentiment improved throughout the day. US equities rally propelled by company earnings, whilst safe-haven assets, particularly precious metals, are taking a breather, recovering from earlier losses, as US Treasury yields remain elevated on Fed’s hawkish commentary.

In the meantime, US economic data, with the July ISM Non-Manufacturing PMI, showed that businesses are holding the fort, with the index rising to 56.7, more than estimated and higher than June’s 55.9. That pares back expectations of a recessionary scenario, which augmented when the ISM Manufacturing PMI expanded at its slowest pace in two years.

Aside from this, the Fed parade continued. Earlier during the day, the uber-hawk St. Louis Fed President Bullard said that he wants to get rates by the end of the year, around 3.75-4.00%. He added that the Fed “is going to move inflation back to 2% over time.” Later, San Francisco’s Fed Daly said she’s open to lifting rates by 50 or 75 bps, but it would depend on inflation data.

The buck’s reaction to the above-mentioned factors had been positive, as shown by the US Dollar Index, rising 0.14%, at 106.483. Lately, US Treasury bond yields are receding from daily highs, one of the reasons silver prices are recovering, with the 10-year bond rate at 2.763%, almost flat.

US weekly crude oil inventories +4467K vs -629K expected

  • Weekly US oil inventory data
  • Prior was -4523K
  • Gasoline +163K vs -1614K exp
  • Distillates -2400K vs +1038K exp
  • Refinery utilization -1.2% vs +0.6% exp
  • US implied oil demand (product supplied) fell by 28kbpd w/w to 19.948mbpd last week with gasoline down 704k bpd.

WTI crude oil settles at $90.66

  • The price has not closed this low since February 16

The price of WTI crude oil is settling at $90.66

The last time the price closed this low was back on February 16, 2022 when the price closed the day at $90.66.


EU News

European stocks finish on the highs

  • Closing changes for the main European bourses

Closing changes in Europe:

  • Stoxx 600 +1.1%
  • German DAX +1.0%
  • French CAC +1.0%
  • UK FTSE 100 +0.5%
  • Spain IBEX +0.2%
  • Italy MIB +0.9%

Other News

Fed’s Kashkari: Inflation is dragging wages up, rather than the other way around

  • Comments from the Fed’s Kashkari
  • Wages are climbing, there’s a risk this shifts to a wage-driven story
  • Concerning that inflation is spreading, the Fed needs to act with urgency
  • Very unlikely Fed will cut rates next year
  • More likely scenario is we ariase rates and then sit there
  • Says he’s not sure what markets are looking at

Cryptocurrency News

Another crypto hack – at least $5mn stolen from Solana wallets

Reports coming in of another huge cryptocurrency hack, this time of the Solana system. The attack is said to be ongoing.

Users report wallets being completely drained. From major internet-connected “hot” wallets including Phantom, Slope and Trust Wallet.

Several Solana addresses have been linked to the attack so far.

At least $5 million worth of SOL, SPL, and other tokens stolen.