Trading Market Commentary August 21, 2017


North American Market

This had been a somewhat calm trading day in geopolitical terms, American markets were a sport of pair of halves yesterday with fundamental lack of strength shortly after the opening bell, being turned into a good direction in close for the day. Banking institutions continue to be affected the most, and with Monday's push getting close to 5% lower for the month thus far.

The S&P500 was able to prevent the slide from a week ago, finishing up marginally by a ticking up 2.82 points (0.1%) to 2,428.37. The Spoo is up 8.46% thus far in 2017. While the NASDAQ rose 29.24 points (0.1%) to 21,703.75, and the DowJones Industrial Average climbed 29.24 points (0.1%). 

The Small Cap Russell 2000 Index was down 2.4%. Trump's commitment to significant corporate tax cuts had elevated small cap securities ever since most of these cutbacks benefit smaller sized, US-focused firms. Due to more robust Canadian Dollar, the TSX (Toronto Stock Exchange) Index consistently is suffering.

European Markets

Once again, it's the German DAX30 which led main Eurozone sentiment lower; however, markets were moving lower well before the Wall Street opened. The FTSE MIB (Milano Italia Borsa) that directed markets lower nonetheless it has been the DAX30 which continues to command the majority of the talk with finishing down minus 0.8% on Monday. The UK’s FTSE100 rebounded into the close to finish little off by 0.1%; as the French CAC40 Index came by with minus 0.5%. 

Energy, and Industrials companies as well as banks which weighed on the Eurozone equity markets; together with plenty of talk regarding the automakers not boosting the confidence. With awaited Friday's Super Mario's (Draghi) talks, tax burden agenda, as well as infrastructure, is what many prefer to hear about, and that seems to be the monetary policy direction, of which uncertainness has ramped up to handicap conviction nowadays.

Asia-Pacific Market

A mixed start for Asia-Pacific to begin the week since we've Jackson Hole symposium coming up, and we hear twofold coming from Super Mario, the fun, as well as games, is yet to begin. News reports of  Steve Bannon’s leaving on Friday hit the market too late for Asia-Pacific region, and therefore cash trading markets readjusted on Monday session.

It turned out only China’s Shanghai Index and the HK's Hang Seng of the main which observed positive trading day session by closing 0.4%, seeing assistance from the Real-estate, Utilities and Natural Resource exploration (CNOOC). The Aussie's ASX200 dropped a little ground yet not too worrying, having to end down minus 0.4%. The Japanese Nikkei225 cash wrapped up the trading day lower around minus 0.4%, with the Yen currency trading below the 109 handle and into a 108 level.  

Currency and Gold Market

Examining the currencies, the US Dollar continues its struggle, and it is currently down 9.95% ever since the beginning of the year. Considering the chaos in the swamp (Washington DC), the Japanese Yen has for the short-term succeeded the Greenback as the safe-haven unit of currency play for traders and investors. Within the longer-term, the currency market is trying to find the Dollar to recover its strength.

The Euro Dollar remains to be bid higher. Longer-term, market is pessimistic on the Euro-Dollar, and also expect to see that in 2018 will experience the single currency to get walloped - we shall see. The GPBUSD (British Pound) captured a bid yesterday. Nevertheless, it remains to be vulnerable to additional weakness. Canadian Dollar (USDCAD) was rallying once again after becoming technically extremely overbought at the start of August of this year.

The yellow metal is indeed making one more try to crack through the major level of resistance at the $1300 level. The yellow metal has been doing some runs at this level of resistance ever since July when it finally established its latest high at $1306.14 this month. Gold finished yesterday at 1296.70, so we will soon see what will transpire in the next few days.

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