Daily Morning Report

Wednesday, September 25–Jim Wyckoff’s Morning Markets Report

Asian and European stock markets were mostly down in overnight trading. U.S. stock indexes are pointed toward modestly lower openings when the New York day session begins.

Traders and investor risk sentiment has up-ticked at mid-week, mainly because of two developments on Tuesday. The first is the harsh rhetoric coming from President Trump in a speech to the United Nations assembly in New York Tuesday morning. Trump slammed China for its unfair trade practices and said the world is no longer embracing “globalization.” Trump said “nationalism” is the new bent among the major countries of the world. Trump’s strong words against China seemingly can’t help but decrease the odds of a substantial U.S.-China trade agreement anytime soon.

The second development Tuesday was that the U.S. House of Representatives is now considering impeaching Trump over what the House says are improper and illegal comments Trump made to a Ukrainian official. Trump responded that he will release the transcript of his comments to the official. Whether Trump actually gets impeached seems unlikely, at this time. However, the inquiry by the House is likely to bog down the U.S. government and could hamstring Trump’s foreign policy agenda, including trade negotiations with China.

Brexit news is near the front burner again after the U.K. Supreme Court ruled that Prime Minister Boris Johnson acted illegally when he suspended Parliament.

Nymex crude oil prices are lower and trading around $56.50 a barrel. The other key outside market today sees the U.S. dollar index trading higher.

U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, new residential sales and the weekly DOE liquid energy stocks report.

–Jim

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Tuesday, September 24–Jim Wyckoff’s Morning Markets Report

Asian and European stock markets were mostly up in overnight trading. U.S. stock indexes are pointed toward modestly higher openings when the New York day session begins. Trader and investor attitudes are a bit more upbeat today, but still not close to being full-speed-ahead risk-on.

There’s been a change of thinking in the marketplace regarding last week’s meeting between U.S. and Chinese trade officials in Washington, D.C. Traders initially deemed the early departure back home of China’s trade delegation as a sign the talks did not go well. The Chinese were scheduled to visit U.S. farms, but the visits were abruptly cancelled. However, language coming from both sides since last Friday has been very upbeat and the trade negotiations are set to continue. The marketplace is now reading this situation as a positive for an eventual U.S.-China trade agreement.

The specter of a very anemic European Union collective economy continues to cloud the European marketplace. Dour manufacturing data coming out of Germany Monday suggests the biggest economy in the Euro zone is headed toward recession.

China’s central bank chief on Tuesday said the People’s Bank of China will not follow the monetary-policy-easing paths of the central banks of the West, and that China’s present interest rates are appropriate.

Nymex crude oil prices are lower and trading around $58.00 a barrel. The other key outside market today sees the U.S. dollar index trading slightly up.

U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the monthly house price index, the S&P-Case-Shiller home price index, the Richmond Fed business survey, and the consumer confidence index.

–Jim

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The U.S. dollar index is a basket of six major currencies weighted against the greenback. See on the daily bar chart that the USDX remains in a price uptrend and is not far below this year’s high. The dollar bulls remain strong, technically, to suggest more gains in the near term, including pushing to new highs for the year. Stay tuned!–Jim

Monday, September 23–Jim Wyckoff’s Morning Markets Report

Purchasing managers’ index (PMI) reports coming out of the European Union Monday showed the Euro zone composite PMI for September come in at a lower-than-expected 50.4. A reading below 50.0 suggests contraction. More worrisome, Germany’s manufacturing PMI in September came in at 41.4, which was also worse than expected and suggests the German economy is teetering on recession.

Nymex crude oil prices are weaker and trading around $57.75 a barrel. The Wall Street Journal reported over the weekend that it could take months, not weeks, to fully restore production at the oil installations attacked in Saudi Arabia in mid-September.

The other key outside market today sees the U.S. dollar index trading up.

U.S. economic data due for release Monday includes the Chicago Fed national activity index, and the U.S. flash manufacturing and service purchasing managers’ indexes. Several Federal Reserve officials also are scheduled to speak today.

–Jim

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Friday, September 20–Jim Wyckoff’s Morning Markets Report

Asian and European stock markets were mostly up in trading overnight. U.S. stock indexes are pointed toward firmer openings when the New York day session begins. It looks to be a quieter end to the trading week as the world marketplace has calmed down significantly after traders came to work Monday dealing with a major geopolitical shock after last weekend’s attack on Saudi Arabian oil installations.

However, many futures traders in many markets will not want to go home for the weekend with big positions, as it still appears the U.S. and Iran are on a collision course at some point down the road.

Nymex crude oil prices are higher and trading around $58.75 a barrel. The other key outside market today sees the U.S. dollar index trading slightly up.

There is no major U.S. economic data due for release Friday.

–Jim

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The wheat, corn and soybean futures markets have all rebounded from their recent summertime lows as autumn officially arrives in a few days. This is the time of year that the grain prices can put in their “harvest lows.” It is my bias that grain futures prices will trend at least sideways, if not sideways to higher, into the end of the year. Stay tuned!–Jim