Market Brief: Trump’s Tariff Time-Out Triggers Triumph for Risk Assets
Matt Weller, CFA, CMT August 13, 2019 9:02 PM
- FX: Risk trades were in demand, despite escalating protests in Hong Kong, making the aussie the day’s strongest major currency and the yen the weakest performer.
- US CPI figures printed a tick hotter than expected at 1.8% y/y, perhaps decreasing the likelihood of aggressive Fed rate cuts in the coming months.
- Commodities: Gold ticked lower on improving risk appetite, while oil (WTI) tacked on another 4% today.
- US indices saw a big bullish turnaround on news that the US would delay 10% tariffs on certain goods, including cell phones, “to help a lot of people” ahead of the Christmas shopping season.
- Technology stocks (XLK) were the strongest sector on the risk asset revival; utilities (XLU) brought up the rear today.
- Traders will be keeping a close eye on tonight’s release of Chinese industrial production, retail sales and fixed asset investment data for any negative impact from the ongoing trade tensions with the US.
- Stocks on the Move:
- Big tariff delay winners today include Apple (AAPL, +4%) and Best Buy (BBY, +6%)
- US-listed shares of JD.com (JD) surged 13% following a better-than-expected earnings report from the Chinese online retailer.
- Insurer Genworth Financial (GNW) gained 16% after announcing a deal to sell a majority stake in its Canadian subsidiary.
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