Weekly Performance
Dow -0.44% S&P -0.38% Nasdaq -0.61% Russell -1.12% Mexico -0.73% Brazil -8.18% (-11.90% in $) Nikkei -1.47% (+0.40% in $) Hang Seng +0.07% CSI +0.55% Shanghai +0.02% EuroStoxx -1.39% (+1.09% in $) FTSE +0.48% (+1.63% in $) Cac -1.50% (+0.97% in $) Dax -1.03% MIB -0.04% Ibex -0.57% SMI -1.11%
In most cases stock indices opened the week at or near recent all-time highs. A continuing run of decelerating US economic data and the steady beat of headlines coming out of Washington DC were largely offset by a move higher in oil prices. Crude was finding support in solidifying market expectations that OPEC would extend supply cuts through next spring when they meet next week. Volatility remained remarkably low, and stocks remained bid globally, helped in part by a speech from China’s President Xi that illustrated the importance his government intends to put on finding new drivers for growth in the wake of softer April economic data. By mid-week the tone dramatically shifted. Headwinds from Washington freshened on a report former FBI Dir Comey had drafted a memo chronicling a meeting with President Trump where he was asked to drop the investigation into former National Sec Adviser Flynn. Within 24 hours, former FBI Dir Mueller was appointed special counsel to oversee the Russia investigation, while the President repeatedly denied the reports, calling the whole thing a ‘witch hunt.’ Markets finally buckled as investors became increasingly concerned the political fallout could ultimately be fatal for the Republican’s pro-growth agenda. The flight from risk assets sent the VIX +27%, ultimately filling the gap made into the French election. Gold prices rose along with global Treasury bonds, sending yields lower. The US 10-year yield fell just short of the April low of 2.18%. The Dollar index gave back all the post-US election/Trump reflation gains. The move into safe have assets was short lived. Equity markets rebounded Thursday in the wake of better US economic readings and technically driven momentum buying after the significant reversal. Markets largely shrugged off the latest political crisis in Brazil, which brought a spat of elevated volatility to Brazilian assets and word the Trump administration was pushing ahead with the NAFTA renegotiation. Oil prices pressed higher on speculation OPEC was contemplating a scenario of deepening supply cuts, not just extending. WTI crude finished the week above the $50 mark. For the week the Dow, S&P and NASDAQ nearly did a round trip, all falling ~0.5%.
Macro :
- Comey Agrees to Testify Before Senate Committee, Senators Say
- Goldman Slashes Expectations for Tax Cut/Fiscal Policy Change
- Weidmann Says ECB Will Need to Act When Prices Rise: Standard
Keep an eye :
- AIR FP : Boeing, SaudiGulf Airlines to Negotiate Widebody Jet Purchase
- AF FP : Air France to Hire 500 Flight Attendants for Low Cost Unit: JDD
- SPR GY : Immoweb.be founder Rousseaux sells 14.5% stake to Axel Springer ( from 80 to 94.5%), C.Rousseaux Co. founder to retain 5.5%
- BMPS IM : Paschi Recap Cut to EU8.3b Was Discussed: Messaggero
- CSGN VX : Credit Suisse to Issue 72.9m Shares From Scrip Dividend Election
- DAI GY : Mercedes-Benz Recalls 5,818 S-Class Cars on Brake Software
- EDF FP : EU Regulators Said Set to Approve EDF Bid for Areva Unit: Rtrs
- FCA IM : Plans to modify over 100K diesel trucks and SUVs as part of effort to resolve allegations that it installed software to cheat emissions standards
- INTU LN : Mall owner Intu faces FTSE 100 relegation on retail woes, Retail property owners are being hit by pessimism over the fortunes of their tenants FT
- LMT US : Saudi Arabia Agrees on Deal to Assemble 150 Lockheed Helicopters
- MC FP : LVMH’s Biver Says Must Give Responsibility to Others: SamW
- NOKIA FH : Nokia to Continue Making Acquisitions, Chairman Tells YLE
- RBOS GY : Bosch May Have to Cut Jobs If Diesel Crisis Worsens: Stuttgarter
- 9984 JP : SoftBank, Saudi Sovereign Fund to Start $100b Tech Fund: WSJ
- THIRD ENERGY : Third Energy Said to Seek to Raise Up to GBP250m in IPO: Times
- VOW3 GY : Audi Reaches Agreement to Solve Dispute With China Dealers
- VOW3 GY : Bavaria’s Seehofer Wants Incentives for Diesel Cars: Spiegel