CFD Markets News and Forecasts — 10-08-2018

U.S. stock-index futures fell on Friday, tracking global shares, as the Turkish lira plunged on concerns over diplomatic rift between Turkey and the United States.

Global Stocks:

I have just authorized a doubling of Tariffs on Steel and Aluminum with respect to Turkey as their currency, the Turkish Lira, slides rapidly downward against our very strong Dollar! Aluminum will now be 20% and Steel 50%. Our relations with Turkey are not good at this time!

The unemployment rate declined by 0.2 percentage points to 5.8%.

In the 12 months to July, employment grew by 246,000 (+1.3%). These gains were largely the result of growth in full-time work (+211,000 or +1.4%). Over this period, the total number of hours worked rose by 1.3%.

Ontario, British Columbia and Newfoundland and Labrador recorded employment increases in July. At the same time, the number of workers declined in Saskatchewan and Manitoba, while it was little changed in the other provinces.

Employment rose in a number of services-producing industries: educational services; health care and social assistance; information, culture and recreation; and the "other services" industry. In contrast, employment fell in most goods-producing industries, specifically manufacturing, construction and natural resources.

The employment increase was driven by public sector employees, while there was little change in the number of private sector employees and the self-employed.

(company / ticker / price / change ($/%) / volume)

Intel (INTC) downgraded to Sell from Neutral at Goldman

The Consumer Price Index increased 0.2 percent in July on a seasonally adjusted basis after rising 0.1 percent in June, the U.S.
Bureau of Labor Statistics reported today. Over the last 12 months, the all items index rose 2.9 percent before seasonal adjustment.
The index for all items less food and energy rose 0.2 percent in July, the same increase as in May and June. Along with the shelter index, the indexes for used cars and trucks, airline fares, new vehicles, household furnishings and operations, and recreation all increased. The indexes for medical care and for apparel both declined in July.

The energy index fell 0.5 percent in July after declining 0.3 percent in June. The indexes for gasoline, natural gas, and electricity all declined modestly in July.

The growth in Quarter 2 (Apr to June) 2018 compared with Quarter 1 (Jan to Mar) 2018 was 0.5%; following growth of 0.3% between Quarter 4 (Oct to Dec) 2017 and Quarter 1 2018.

This is the largest quarterly services growth since Quarter 4 2016.

The wholesale, retail and motor trade sector made the largest contribution to the quarterly growth, contributing 0.20 percentage points.

The Index of Services was flat between May 2018 and June 2018.

Increases in the information and communication sector in June 2018 were offset by falls in the professional, scientific and technical activities, and wholesale, retail and motor trades sectors.

In the three months to June 2018, services output increased by 1.5% compared with the three months ending June 2017.

Commenting on today's gross domestic product (GDP) figures, Head of National Accounts Rob-Kent Smith said:

"The economy picked up a little in the second quarter with both retail sales and construction helped by the good weather and rebounding from the effects of the snow earlier in the year. However, manufacturing continued to fall back from its high point at the end of last year and underlying growth remained modest by historical standards.

"The UK's trade deficit noticeably worsened as exports of cars and planes declined sharply while imports rose."

The total UK trade deficit widened £4.7 billion to £8.6 billion in the three months to June 2018, due mainly to falling goods exports and rising goods imports.

Removing the effect of inflation, the total trade deficit widened £4.1 billion in the three months to June 2018; falling goods export volumes were the main factor as prices generally increased.

The trade in goods deficit widened £2.9 billion with countries outside the EU and £2.6 billion with the EU in the three months to June 2018.

Falling car and aircraft exports and rising imports of unspecified goods (including non-monetary gold) to and from non-EU countries were the leading factors in the widening of the total trade deficit in the three months to June 2018.

In Quarter 2 (Apr to June) 2018, the Index of Production fell by 0.8% compared with Quarter 1 (Jan to Mar) 2018, due to a fall of 0.9% in manufacturing and a fall in energy supply of 2.7%.

In June 2018, total production was estimated to have increased by 0.4% compared with May 2018, due to increases in manufacturing of 0.4% and water and waste of 1.6%.

The monthly increase in manufacturing output of 0.4% was supported by increases in 7 of the 13 sub-sectors, led by basic pharmaceutical products (4.5%), rubber and plastic products (3.0%) and basic metals and metal products (1.3%).

In Quarter 2 2018, the Index of Production increased by 1.4% compared with Quarter 2 2017, due primarily to a rise in manufacturing of 1.3%.

In Q2 2018, private payroll employment continued to grow at a moderate pace : +0.2% after +0.2% in Q1 (that is +31,000 net job creations after +46,000 jobs). Year on year, private payroll employment increased by +1.3% (that is +241,100 jobs). Excluding temporary employment, it increased by +0.2% over the quarter (that is +29,900 jobs) and by +1.0% over the year (+186,500 jobs).

Private payroll employment increased at the same pace as in the previous quarter in construction (+0.3%, +4,100 jobs, after +3,600 jobs). It fell back by 0.1% in industry (that is −3,800 jobs, after −700 jobs). Year on year, private employment increased by 23,200 in construction and by 3,800 in industry.

In market services, private employment continued to increase: +0.2% (that is +29,600 jobs), a little more slowly than in the previous quarters (+0.3% in Q1 2018). Its rise amounts to 199,900 over a year. Excluding temporary employment, it grows at the same pace as in Q1 2018: +0.3%. Private employment in non-market services stabilised in Q2 2018 (after +0.1%), at a level 0.4% higher than a year ago.

In June 2018, output bounced back in the manufacturing industry (+0.6% after −0.5% in May) as well as in the whole industry (+0.6% after −0.2%).

Manufacturing output was virtually stable over the second quarter of 2018 (+0.1%). It decreased in the overall industry (−0.4%).

Compared with the first quarter of 2018, output decreased markedly in mining and quarrying, energy, water supply (−3.2%) and in the manufacture of machinery and equipment goods (−2.3%). It tumbled in the manufacture of coke and refined petroleum products (−10.8%) due to maintenance operations. On the contrary, it rose sharply in the manufacture of transport equipment (+2.4%), and more slightly in "other manufacturing" (+0.3%) and in the manufacture of food products and beverages (+0.5%).

Over a year, manufacturing output increased (+1.4%)

EUR/USD

Resistance levels (open interest**, contracts)

$1.1734 (3859)

$1.1672 (1605)

$1.1631 (4076)

Price at time of writing this review: $1.1458

Support levels (open interest**, contracts):

$1.1405 (4464)

$1.1366 (4071)

$1.1325 (2202)

Comments:

- Overall open interest on the CALL options and PUT options with the expiration date September, 7 is 127472 contracts (according to data from August, 9) with the maximum number of contracts with strike price $1,1500 (11369);

GBP/USD

Resistance levels (open interest**, contracts)

$1.3016 (730)

$1.2988 (598)

$1.2944 (213)

Price at time of writing this review: $1.2794

Support levels (open interest**, contracts):

$1.2751 (2782)

$1.2721 (1424)

$1.2688 (1889)

Comments:

- Overall open interest on the CALL options with the expiration date September, 7 is 31539 contracts, with the maximum number of contracts with strike price $1,3450 (3337);

- Overall open interest on the PUT options with the expiration date September, 7 is 28898 contracts, with the maximum number of contracts with strike price $1,2900 (3180);

- The ratio of PUT/CALL was 0.92 versus 0.90 from the previous trading day according to data from August, 9.

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.

The ECB's Single Supervisory Mechanism is concerned about Turkish borrowers defaulting on foreign-currency loans, according to the FT.

Japan's gross domestic product gained a seasonally adjusted 0.5 percent on quarter in the second quarter of 2018, according to rttnews.

That exceeded expectations for an increase of 0.3 percent following the 0.2 percent loss in the three months prior.

On an annualized basis, GDP was up 1.9 percent - again topping expectations for 1.4 percent following the 0.6 percent contraction in the previous three months.

The GDP deflator was up 0.1 percent on year, beating forecasts for a fall of 0.2 percent and down from 0.5 percent in the first quarter.

There is nothing in the today's policy/forecast report from the Reserve Bank of Australia to suggest it's getting closer to raising interest rates. Near-term inflation forecasts have been trimmed and the expected peak in GDP growth has also be lowered.

That as unemployment is set to fall to 5% by the end of 2020. Combined with the prospect of a global slowdown that year as US fiscal stimulus fades, it's going to be some time before the RBA comes off the sidelines, says WSJ.

New Zealand's manufacturing expansion continued its downward trend, according to the latest BNZ - BusinessNZ Performance of Manufacturing Index (PMI).

The seasonally adjusted PMI for July was 51.2 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining). This was 1.5 points lower than June, and the third consecutive month where expansion has weakened.

BusinessNZ's executive director for manufacturing Catherine Beard said that the July result produced a few red flags in terms of where the manufacturing sector currently sits.