Wealth Daily 22 July 2022



WEALTH DAILY 2022-07-22
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US economic data (jobless claims, the index of Leading Economic Indicators, Philadelphia Fed factory outlook) out on Thur pointed toward a slowing US economy. Investors bought government bonds, sending yields lower. 


However, the negative data did not prevent US equities from continuing to storm higher. Tesla shares (TSLA US, 9.78%) surged on the back of better-than-expected earnings results. Tech stocks got a boost from a softer US dollar. 


The Dow Jones Industrial Average gained 162.06 pts or 0.51% to close at 32,036.90. The broader S&P 500 index rose 0.99%. The tech-heavy Nasdaq Composite advanced 1.36%. The small cap Russell 2000 gained 0.48%. 


Megacap tech stocks rose on Thur, including Apple (AAPL US, +1.51%), Microsoft (MSFT US, +0.98%), Amazon (AMZN US, +1.52%), Alphabet (GOOGL US, +0.39%) and NVidia (NVDA US, +1.36%). Meta Platforms remains relatively unchanged (META US). 


The yield on the 10-year Treasury note slipped 15.18 basis points (bps) to 2.8747%, while the yield on the 2-year Treasuries fell 14.22 bps to 3.0850%. 


The yield of the German 10-year bund dropped too, even though the European Central Bank (ECB) hiked its key interest rate by 50 bps, the first increase in 11 years. After initially jumping 10 bps to 1.36%, the yield of the 10-year bund is currently trading around 1.216%. 


The ICE dollar index (DXY), which measures the strength of the greenback against a basket of currencies, fell 0.16% to 106.910. The euro gained 0.49% to 1.0230 on Thur. 


Early trade in US equity futures point to a softer opening when Wall Street opens for business later today (Fri). Snap (SNAP US, +5.42%) shed 26.54% in after-hours trade on Thur, after the firm’s 2Q22 revenue missed expectations and cited a major slowdown in the advertising industry that is likely to affect other technology giants. 


The front-month Brent and WTI futures closed down $3.06 at US$103.86/bbl and $5.91 at US$96.35/bbl respectively. 


The most actively traded US gold futures (Aug) contracts settled up $13.20, or 0.8%, at US$1,713.40/oz. September silver, which is the most actively traded silver futures, rose 5.1 cents, or 0.3%, to end at US$18.719/oz.  European equity markets finished mixed on Thur.


The UK FTSE gained 0.09%, France's CAC 40 rose 0.27%, with the exception of the German DAX, which retreated 0.27%.