To the scoreboard
- Dow: 25,064.36 +44.95 (+0.18%)
- S&P500: 2,798.43 -2.88 (-0.10%)
- AUD/USD: 0.7420 +0.0001 (+0.01%)
- ASX SPI futures (September contracts): 6,180 (-12)
1. Oil prices dropped to three-month lows overnight, with traders eyeing a likely increase in supply over coming months as major oil producers ramp up production. Brent crude — the global benchmark — shed 4.63% to $US71.84.
2. The sharp fall in oil weighed on energy stocks in the US, with those falls offset by gains in the financial sector as the S&P500 finished flat. Tech giant Netflix slumped by 13% after missing revenue expectations.
3. The US got a solid retail sales print, partially bolstered by an uptick in car purchases. Sales rose by 0.5% in June, leaving the annual print at 6.6% — the fastest growth rate since 2013. Retail sales for May also got revised higher.
4. US bond yields edged higher in the wake of the retail data, with benchmark 10-years climbing to 2.856%. That pushed the 2-10 yield curve slightly higher, although it remains at decade lows — a fact cited by Minnesota Fed Chair Neel Kashkari overnight as a reason to halt rate rises.
5. Bitcoin rose by almost 5% to around $US6,650 after global asset manager Blackrock said it was looking into blockchain and cryptocurrencies. Also overnight, millennial investing app Robinhood announced it had added two more cryptocurrencies to its trading platform.
6. The Australian dollar traded in a narrow range amid a mild bout of weakness in the USD. In addition to falling oil prices, copper also dipped again while lower grade iron ore prices got hammered.
Here’s a look at the key events on today’s economic calendar:
- RBA board minutes from July meeting (11:30am AEST).
- China house price data and industrial capacity utilisation.
- UK employment and wages data.
- Speech from Bank of England governor Mark Carney.
- Fed Chair Jay Powell makes semi-annual testimony to US Congress.
Have a great day.
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