Morning Report

Friday, 27 July 2018

  • Asian stocks rose on Friday, with Australia leading the morning’s gains.
  • U.S. stocks closed mixed, with the Nasdaq Composite recording its worst day in around a month.
  • The euro was nursed wounds after stumbling overnight when the European Central Bank kept policy steady.

Asian shares edged higher on Friday, with Australia leading the advance in the morning after a mixed session on Wall Street which saw technology stocks lag.

The Nikkei 225 advanced 0.25 percent, South Korea’s Kospi drifted higher by 0.03 percent while in Australia, the S&P/ASX 200 recorded more convincing gains of 0.82 percent in morning trade.

U.S. stocks were mixed overnight, with technology taking a beating after Facebook reported a miss in second-quarter revenue after the market close on Wednesday. The Dow Jones Industrial Average rose 0.44 percent, or 112.97 points, to 25,527.07, notching its third consecutive session of gains. Other U.S. indexes finished in negative territory, with the Nasdaq Composite recording its worst day in around a month, falling 1.01 percent to 7,852.19, and the S&P 500 edging down by 0.3 percent to end at 2,837.44.

Over in Europe, stocks rose in the last session, supported by waning concerns over trade after talks between the U.S. and European Union. The pan-European Stoxx 600 advanced 0.87 percent on Thursday.

On the trade front, U.S. Treasury Secretary Steven Mnuchin told CNBC on Thursday that the U.S. was making progress on North American Free Trade Agreement (NAFTA) and hoped to secure a deal in the near future.

Meanwhile, the euro was steady after its overnight stumble when the European Central Bank kept its policy unchanged. The fall in the common currency saw the dollar index, which tracks the U.S. currency against a basket of peers, firm to last stand at 94.751 as investors awaited the Friday release of second-quarter U.S. GDP due during U.S. hours.

Oil prices edged down on Friday after three days of gains, but were still supported by Saudi Arabia’s halt on transporting crude through a key shipping lane, falling U.S. inventories and easing trade tensions between Washington and Europe. Brent futures were down 6 cents at $74.48 a barrel, after gaining 0.8 percent on Thursday. U.S. West Texas Intermediate futures were also 6 cents lower, at $69.55, after posting a nearly 0.5-percent gain the previous session.

The People’s Bank of China (PBOC) set the Yuan reference rate at 6.7942 vs the previous day’s fix of 6.7662. This Devaluation of Chinese Currency will again put being pressure on USD/INR. However IPO Flows will prevent sharp up move in the pair.

Source : Reuters

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