We see Wall Street futures higher, with the Nasdaq continuing to outperform the S&P 500 and Dow Jones, thanks to a rebound in Apple after iPhone shipments rebounded in China. Investors remain cautious after returning from the extended weekend as markets in the US and UK were closed yesterday.
The S&P 500 is up 0.25% and the Nasdaq is up 0.3% after Apple shares rose as much as 2.4% in pre-market trading (currently up 1.6%). The Dow Jones is little changed, similar to the markets in Europe. Asian stocks had a strong start to the week (yesterday), but also closed today's trading day mixed. Trading volumes remain thin as investors are still looking for further hints of rate cuts from the Fed, as well as other central banks. The “meme” stock GameStop is up nearly 25% after the (in reality “obsolete”) video game retailer announced that it had raised nearly $1 billion through a stock sale program,
The latest US economic data points to a renewed acceleration in the US economy – and with it a renewed acceleration in inflation. Concerns remain, but the overall robust growth outlook and another strong earnings season are keeping investors invested in equities. The main focus this week will be on inflation data – particularly the US PCE data on Friday.
There is also little movement in the bond market – a sign that investors are not fleeing to safety, but also that rate cut expectations are already at a low level, limiting headwinds from further reduced rate cut expectations. Swap markets are split on one or two Fed rate cuts this year – in my opinion, it is more likely that no rate cut or at most one rate cut in the fourth quarter. Stubborn inflation data on Friday (possibly) therefore still has some potential to weigh on equities and market sentiment.
In addition, we see a solid development in commodity prices, which are also picking up again thanks to a (temporary) weakening of the USD.
Meanwhile, the “T+1” rule comes into force in the US today, whereby shares are settled on one day instead of two. There are some concerns about potential teething problems, such as international investors having difficulty getting the USD in on time as global funds now move at different speeds and everyone has less time to work out bugs. As banks have prepared for today, I don't expect any surprises.
There is room for recovery – still in the stock market, but also in gold and oil prices after the recent slump. As the economic calendar is empty today, assets will hit key support and resistance lines. We expect a cautiously positive market today.
👁 ROB'S MARKET OVERVIEW:
May 28, 2024
🌐/🇺🇸 Global Markets ➡️/↗️
Cyclical / Luxury Stocks ➡️/↗️
Tech/Growth Stocks ↗️/➡️ (benefiting from rebound in iPhone sales / positive chip stocks / stable yields, weaker USD)
Financial Stocks ➡️
Defensive Stocks ➡️
Energy Stocks ↗️ (bounce from oversold territory)
Materials Stocks ↗️
💱 Forex
AUD, CAD ↗️/➡️ (slight additional early gains, with USD stabilizing, further AUD gains limited)
GBP, CHF ↗️/➡️
EUR ➡️
JPY ➡️/↘️ (mostly flat for today, but remains bearish)
USD ↘️/➡️/↗️ (further losses limited)
⚒ Commodity Markets ↗️/➡️
Oil prices ↗️/➡️
Natural Gas prices ↗️/↕️
Metal prices ↗️/➡️
Gold ↗️/↕️ (trying to move towards and above $2,360 – remains in recovery mode)
⚡️Cryptos ↕️ (btc moving in the range $67K – $70K for now after ETF hype eased / general outlook rather bullish)
(*↗️ bullish, ↘️ bearish, ➡️ sideways / stable, ↕️ mixed / volatile)
Your Robert
