Dow -0.15%, S&P 500 -0.13%, Nasdaq -0.15%, Russell 2000 -0.22%, SOX -1.12%, Eurostoxx -0.84%, SMI + 0.46% .
This is an interesting day that stock indices prepared for us yesterday. Europe is waking up in a gloomy mood, waiting for a hangover, the achievements of the previous day are good, but no one was deceived, followed by almost a technical rebound. Starting in retro pedaling mode, so yesterday morning the future of the S & P500 (SPX) returned a significant portion of profits the day before, we resigned ourselves to the trading rooms, the bulls seem unable to regain control. And then a man who could whisper in the ears of the bazaar, remembers a good memory. Jerome Powell, the Fed’s chairman, appears before the US Senate Banking Committee and explicitly states that “the United States economy is very strong and can support restrictive monetary policy.” The rest of the remarks of the head of the Federal Reserve can be quite cautious, in particular, when he said that the recession is not excluded, the message passed: in trading halls quickly concluded that the world’s first banker may not be so hawk, and, consequently, the Federal the US backup system may be less aggressive than expected.
As a result of the races, SPX, which started the session with a 2% drop, switches to Space-X mode and goes into positive territory by 1% to finally recoup the win and end its day a little underwater. So, of course, the loudest voices heard in the market remain the voices of bears, which continue to proclaim that the economy is heading for the wall and that these are “bear market rallies.” This is a good premise, but the fact is that the market managed to defend almost all the winnings on Tuesday, it’s a mini-battle won by the bulls, especially since the start of the day session is the opposite, and Jerome Powell makes it clear that to achieve soft Landing for US economic growth is a challenge. So yesterday the market had many good reasons to retreat, it does not, and bears of all stripes must seriously ask why. Changes in market trends are always happening under our noses, we ourselves are not aware of it. It should be briefly noted that Charles Evans, President of the Chicago Fed, also reassures stakeholders, saying that growth in July may be limited to 50 basis points depending on economic statistics to be published by then, and that the Fed may then return to pace. 25 basis points per meeting.
In terms of sectors, today’s SPX podium consists of real estate, healthcare and utilities. Notice the energy that stumbles on the carpet, oil is approaching $ 100 per barrel of light WTI oil before returning to $ 104.25 this morning. Retreating black gold is a potential sigh of relief for investors as it somewhat eliminates the specter of inflation. At the same time, the fall in the barrel is clearly related to concerns about the collapse of global demand, along with Joe Biden’s desire to suspend the tax of 18 cents per gallon for the next three months. Market sentiment is also driven by a marked decline in bond yields as the 10-year period fell to 3.13%.
The stability of the stock market raises questions. Are we, as the bears claim, a purely technical rebound? if growth problems are not taken into account now? Remember that the Dow Jones, Nasdaq and S & P500 indexes have fallen 12, 22.1 and 16.9% since the beginning of the second quarter. Technically, the SPX has entered the rebound configuration, now looking at its 20-day moving average of 3,955 points (closed at 3,759 points yesterday). At the same time, SPX has two gaps to fill, the first at 3900 points and the second at 4017 points.
Tired of dealing with cryptocurrencies? Not sporty enough for you? So trade Revlon shares! On June 15, the cosmetics giant filed an application to defend Chapter 11. Apparently, Revlon has gone bankrupt, now it is under guardianship
vultures creditors cannot bear him a blow, Chapter 11 watches over the grain. The bankrupt company is theoretically zero in the stock market. Well, Revlon rose 539% from its low on June 16… so-called “retail” investors are in a hurry to value, calls (call rights) rose 1153%, only yesterday the title rose 63% in trading 101 million shares ($ 8.14 per share per call). 101 million shares sold 570 times the average daily volume last year… and think that there are some who play for the euro-million, how boring…
Extended PMI production indices for June will be published during the day. In the United States, we will also monitor weekly unemployment claims.
Berkshire Hathaway is buying an additional 9.6 million shares of Occidental Petroleum to receive more than 16% of the capital. According to Bloomberg, Uber is studying the sale of its subsidiary for mobility in India. BMW begins production at its new $ 2.2 billion electric car plant in China. The FDA approves the combination of Novartis Tafinlar and Mekinist for cancer treatment.
Last night and this morning in Asia, indices generally traded up, with the exception of Seoul, which fell 1.22%. Tokyo gets 0.08%, Hong Kong grows by 1.68% and Shanghai gets 1.55%. Europe fell 0.6% as SPX futures fell 12 points. We’ll see what awaits these upcoming sessions, which promise to be exciting, especially as Uncle Jay hands over part of this House Financial Services Committee at 4 p.m.