Originally published by Rivkin Securities
Trump’s continuing intervention in trade has again spooked markets and sent the S&P 500 1.4% lower. The main concern comes from a new proposal to ban investment in America from companies that are “trying to steal our technology”. This is clearly aimed primarily at China and would reduce investment in America if it becomes law. Some of the biggest decliners were tech stocks, like Netflix (NASDAQ:NFLX), which fell 6.5%.
After rallying sharply following the OPEC meeting last week, oil declined overnight, possibly in anticipation of the increased supply as a result of OPEC agreeing to ease the supply cuts that were implemented at the beginning of last year. Despite the share price weakness, precious metals failed to rally with gold staying near six-month lows at US$1,266 per ounce. The prospect of continuing rate hikes is likely keeping gold under pressure with the CME Fedwatch tool predicting a 73% chance of a further 25 basis point hike at the September meeting.
The slide in the AUD has halted for the time being, currently trading just above US$0.74. Weakness in the US dollar index overnight probably provided support for the AUD.
Data Releases:
- No Significant Data