Tuesday's Market Recap - Possible Trump Xi Meeting, Dovish ECB, Bet On A Dovish Fed, Sends Stock
What is The Premarket Telling Us?
7:00 AM.
Stock futures are mostly flat ahead of the start of trading. Dow futures up 4 points, Nasdaq futures up 1.25 points, and S&P futures down a fraction 0.25 point.
Fed/FOMC begins its June meeting today, with an interest rate decision due tomorrow afternoon.Investors are expecting to hear dovish tones from Fed Chair Powell, setting up the markets for a rate cut in July. Today we heard from a very dovish ECB President Draghi, still promising "by all means necessary" support to stimulate the EU economy. US and global 10 Year Bond Yield have returned to the lower end of their respective ranges.
On The Bond Desk:
The US 10 Year Bond Yield at 2.06% down 0.03%.
Currency Desk:
Euro dollar: 1.12
UK Pound: 1.25
Crude Oil:
WTI crude oil futures at $53.84/barrel, down 0.11%.
On the Earnings Calendar:
None.
In M&A News:
None.
What About The Asian And European Markets?
Major Asian markets. Japan (Nikkei 225) up 1.72%, Shanghai %, Hong Kong (Hang Seng) up 2.56%.
Major European markets. German (DAX) jumped 2.03%, France CAC 40 up 2.20%, London FTSE 100 up 1.17%.
Market And Sector Dynamics
Stocks jumped higher from the 'get go.' The Dow climbed 145 points, Nasdaq gained 76 points, and the S&P rose 18 points. This risk on session is buoyed by a tweet from the President that he spoke with China's President Xi last night, and they will be meeting at the G20 meeting in Japan next week, and that US China trade talks are about to resume.
Facebook, and other FAANG stock are up again today, along with Alibaba, Boeing, Apple. Shares of companies that were under pressure as a result of US China trade war, are doing better today
Markets gained additional momentum after the opening bell, with the Dow up 415 points, the high of the day, around 11:00 AM, before a modest pull back during the afternoon session.
Today's rally was broad based, with eight of the eleven S&P sectors closed with solid gains. The sector leading the rally were Industrials, Technology, Energy, Financials, Healthcare, Basic Materials, Consumer Discretionary, and Communication Services, while Consumer Staple, Utilities, and Real Estate lagged in the session.
Factors Influencing Today's Market
President Trump tweet stating that he spoke with China's President Xi, and confirmed they will be meeting at the G20 Sumit in Japan. The negotiating teams would resume talks soon.
ECB President, Mario Draghi took a dovish stance on support for EU economies, in the face of a global slow down.
Global and US 10 Bond Yields have declined to the lower end of their recent ranges.
WTI crude oil jumped higher today, up 3.79%, at $53.90/barrel.
Fed/FOMC begins its June policy meeting today, with a decision expected tomorrow afternoon. No decision on rate is expected at this meeting.
May Housing Starts came in better than expected at 1.269 million vs 1.239 million estimated.
Market Close Volume Traded And Advance Decline Ratio
At the end of trading the Dow surged 353.01 points, Nasdaq jumped 108.06 points, and the S&P gained 28.08 points. Total NYSE volume traded, a moderate 3.44 billion shares. Advancing shares outpaced Declining shares 1.52:1.
Data Sources: Bloomberg, CNBC, CNN Money, Google Finance, Market Watch, TD Ameritrade, Yahoo Finance.
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