Market Wrap: U.S. Stocks Close Positively, Dollar Index Slips

Market Wrap: Stocks, Bonds, Commodities

On Wednesday, U.S. stocks closed on a positive note with the S&P 500 rising by 49 points (+1.11%) to reach 4,436. The Nasdaq 100 also performed well, surging by 239 points (+1.6%) to 15,148, and the Dow Jones Industrial Average gained 184 points (+0.54%) to reach 34,472.

Leading the gains were the Semiconductors & Semiconductor Equipment (+2.47%) and Media (+2.12%) sectors, while the Consumer Durables & Apparel (-0.79%) and Energy (-0.3%) sectors lagged behind during the trading session.

Notable Company Moves:

• Netflix (NFLX):The video streaming service saw a rise of 3.48% as it continued to attract new users in the U.S. and took measures to curb password sharing.

• Foot Locker (FL):The athletic footwear and apparel retailer experienced a sharp decline of 28.28% after revising its full-year guidance and suspending dividend payments.

• Urban Outfitters (URBN):The clothing retailer saw a rise of 3.05% as its quarterly earnings exceeded estimates.

• Peloton Interactive (PTON):The interactive fitness platform faced a decline of 22.6% after providing disappointing revenue and adjusted EBITDA guidance for the current quarter.

U.S. Economic Data:

• The S&P Global Manufacturing Purchasing Managers Index for August came in at 47, below the expected 49.5, while the services PMI was at 51.0, also below the anticipated 52.0.

• Annualized new home sales for July were reported at 714,000 units, surpassing the estimated 686,000 units.

Bond Market: The U.S. 10-year Treasury Yield decreased by 13.6 basis points to 4.188%.

European Stocks: European stocks displayed a general upward trend, with the Dax 40 rising by 0.15%, the Cac 40 gaining 0.08%, and the FTSE 100 climbing 0.68%.

Commodities: WTI Crude Futures (October) fell by $0.75 to $78.89. Crude oil inventories were reported to have decreased by 6.14 million barrels in the week ending August 18, compared to an expected draw of 2.85 million barrels.

Spot gold rose by $18 to $1,915, nearing a 2-week high, partly due to weak U.S. PMI data that reduced rate hike expectations.

Market Wrap: Forex

The U.S. dollar index slipped by 0.14% to reach 103.41.

EUR/USD saw an increase of 16 pips, reaching 1.0862. In the eurozone, the HCOB Manufacturing Purchasing Managers index improved to 43.7 in August, surpassing the anticipated 42.6, while the Services PMI declined to 48.3, below the expected 50.7.

GBP/USD lost 16 pips, reaching 1.2716. In the U.K., the S&P Global Manufacturing PMI fell to 42.5 in August, below the expected 45.2, and Services PMI dropped to 48.7, also falling short of the expected 50.5.

USD/JPY slid by 104 pips to 144.85, while USD/CHF dropped by 24 pips to 0.8780.

AUD/USD rose by 49 pips to 0.6472, while USD/CAD fell by 13 pips to 1.3537. Canada's retail sales grew by 0.1% on a monthly basis in June, surpassing the expected decline of 0.1%.

Bitcoin rebounded by 2.9% to $26,545.

Morning Trading: In Asian trading hours, EUR/USD eased to 1.0857 and GBP/USD fell to 1.2708. Meanwhile, USD/JPY rebounded to 145.00 after hitting an intraday low near 144.57. Gold climbed to $1,918, while Bitcoin slipped to $26,391.

EUR/USD Intraday: The bias remains bullish.

Pivot: 1.0845

Our preference: Long positions above 1.0845 with targets at 1.0880 & 1.0900 in extension.

Alternative scenario: Below 1.0845 look for further downside with 1.0830 & 1.0815 as targets.

Comment: The RSI shows upside momentum.

Dow Jones (CME)‎ (U3)‎ Intraday: towards 34780.00.

Pivot: 34435.00

Our preference: Long positions above 34435.00 with targets at 34630.00 & 34780.00 in extension.

Alternative scenario: Below 34435.00 look for further downside with 34325.00 & 34150.00 as targets.

Comment: The next resistances are at 34630.00 and then at 34780.00.

GBP/USD Intraday: the upside prevails.

Pivot: 1.2685

Our preference: Long positions above 1.2685 with targets at 1.2740 & 1.2765 in extension.

Alternative scenario: Below 1.2685 look for further downside with 1.2660 & 1.2640 as targets.

Comment: The RSI shows upside momentum.