Wednesday, September 4–Jim Wyckoff’s Morning Markets Report
Asian and European stock markets mostly higher overnight. U.S. stock indexes are pointed toward solidly higher openings when the New York day session begins. Traders and investors around the globe were cheered today when Hong Kong’s leader withdrew from consideration a proposed law that would allow the extradition of Hong Kong citizens to mainland China for criminal trials. This proposed new law had been one of the reasons for the major protesting seen in Hong Kong the past few months. However, it’s too early to determine if this reversal of Hong Kong’s leader on the matter will be enough to quell the civil unrest.
The China-U.S. trade war remains on the front burner of the world marketplace, and has escalated in recent days.
The leader of the International Monetary Fund, Christine Lagarde, said Wednesday the European Central Bank needs an accommodative monetary policy for a period of time due to threats on the horizon. This comes after the Euro zone reported its retail sales for July fell 0.6% from June.
Meantime, the U.K. economy could be tipping into recession amid the Brexit turmoil. Purchasing managers’ data for August, released today, was weaker than in July. The British pound this week hit a more-than-30-year low against the U.S. dollar.
The key “outside markets” today see Nymex crude oil prices higher and trading around $54.50 a barrel. The U.S. dollar index is lower on a normal downside correction after hitting a 27-month high Monday.
U.S. economic data due for release Wednesday includes the Federal Reserve’s beige book, weekly MBA mortgage applications survey, the weekly Johnson Redbook and Goldman Sachs retail sales reports, the international trade report, the ISM New York report on business, and the IDB-TIPP economic optimism index.