📆 Tuesday, July 16
► European stocks experienced a downturn ahead of the European Central Bank’s rate decision on Thursday. The Stoxx 600 index dropped 0.4%. The luxury fashion sector was hit hard as Hugo Boss sank 10% after cutting its profit guidance due to weaker demand for high-end fashion items. The mining sector also underperformed, with Rio Tinto Group's shares declining following disappointing guidance on its copper operations. Overall sentiment was dampened despite some positive economic indicators, as investors turned their attention to upcoming US retail sales data for potential insights into Federal Reserve interest rate decisions.
► US equity futures remain unchanged, reflecting a cautious market stance ahead of key economic data and corporate earnings reports. S&P 500 futures remained steady as investors awaited retail sales figures, which are expected to show flat month-on-month growth for June. This data is crucial as it could influence Federal Reserve policy, especially after Fed Chair Jerome Powell stated that inflation is moving towards the central bank’s 2% goal. Major earnings reports from Morgan Stanley and Bank of America are anticipated to provide further market direction, following a strong earnings report from Goldman Sachs on Monday. The USD strengthened against most of its Group-of-10 peers, driven by speculation that Donald Trump is in a strong position to win the upcoming US presidential election. Trump also recently announced his choice of JD Vance (39) as his running mate.
► Asian markets closed mixed, with the MSCI AC Asia Pacific index heading for a third consecutive day of losses. Hong Kong stocks led the decline in the region, while some Chinese stocks also traded lower amid rising geopolitical concerns. Trump’s proposed new tariffs of 60% on all Chinese exports to the US could significantly impact China's annual growth rate, as noted by UBS Group. Meanwhile, Japanese stocks rose as investors bet on Japan remaining in favorable terms with the US under a potential second Trump term. The JPY weakened against the USD, reflecting market expectations of a prolonged period of weakness for the Japanese currency.
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