Finance Update – Woodward: Trump understood COVID peril

Americas – He knew!

Yesterday’s index recovery seems to have been short-lived, this morning, with S&P futures down 0.15% and Dow -0.28%. The Nasdaq recovered 2.71% yesterday followed by the S&P’s 2.01%, the Dow and Russel gaining about 1.5% each.

The dollar curbed its 9-day surge yesterday swiftly losing 50 cents to the index in afternoon trading and edging slowly down thereafter despite mainly positive data: Mortgage applications for the 1st week of September increased nearly 3% following the previous week’s 2% contraction; job openings increased by 600K to 6.618mn in July, and the yield on the 10-yr note increased to 0.704%.

The only downside came from a surprise build in oil reserves at Cushing following 6 straight weeks of withdrawals, which SHOULD have been bearish for oil prices.

And, of course, Bob Woodward’s upcoming book on President Trump in which the US leader says he knew how deadly the Coronavirus was but decided to play down the crisis to prevent panic.

Housing data in Canada was also good – an increase in starts totalling 262K for August. The Central Bank kept interestThe cost of accessing money not owned. rates steady, as expected.

Asia – China threatens Taiwan

A Chinese jets threaten Taiwan for a 2nd day in a row, and with little data coming from the Asian region overnight, indices this morning are in the green, save China’s A50, which lost 1.5% during the session. The Kospi is up 1.2%, the Nikkei 1.55% and the Hang Seng 0.16%.

Credit card retail sales in New Zealand contracted by a concerning 7.9% MoM in August, and Australia’s consumer inflationThe rise in prices for goods and services, resulting in the deterioration of a currency’s purchasi... expectations contacted slightly to 3.1% for September.

In Japan, Machinery orders shot up by 6.3% MoM in July, and foreign investments increased to ¥377.9 bn for bonds and ¥11.6 bn in shares, following contractions in both during the last week of August.

Europe – UK Brexit emergency talks today

European indices also recovered most of the previous day’s losses, the Polish WIG closing up 2.28%, the DAX 2.07% and the FTSE and CAC 1.4%.

In the UK housing prices soared, according to the Royal Institution of Chartered Surveyors, by a whopping 44% in August, the report dwelling on the British desire for gardens amidst lockdowns.

EC VP Marcos Sefcovic and UK Min for Cabinet Michael Grove will meet for an emergency meeting in London today to discuss PM Johnson’s threat to renege on Brexit agreements already finalized in case of a no-deal divorce.

Commodities – Drilling ban pushes oil

WTI yesterday reverse its plunge, managing to gain $2 on the barrel despite the APIs report of a 2.97mB build in inventories over the previous week. The price increase is ascribed to yesterday’s 10-year ban on oil drilling signed into law by the US president.

Corporate – Ireland to fine FB 2 bn

Aurora Cannabis has delayed its earnings report to the 22nd.

Lloyds shares lost 0.17% yesterday as the company posted a pre-tax loss of £400mn loss for the 1st half of 2020. And Slack continues down another 13.9% despite its 49% increase YoY in revenues announced Tuesday.

Facebook is up 0.17% after the Irish Data Protection Commission threatened a 4% fine on its annual revenue (about $2.8bn) unless the company ceases from transferring EU user data to its offices in the US.

Today expect earnings from Oracle and Morrison. Chevron, Microsoft, Rockwell, Raytheon, Eli Lilly, Eaton and Exelon pay dividends. And Netapp and Invesco hold shareholders meetings.

Events