CURRENCY MARKET WRAP 

As of Thu Nov 21st, Singapore Time zone UTC+8

U.S. Dollar Index, +0.01%, 97.87
USDJPY, -0.02%, $108.53
EURUSD, -0.01%, $1.1078
GBPUSD, -0.02%, $1.2926
USDCAD, +0.27%, $1.3304
AUDUSD, -0.39%, $0.6801
NZDUSD, -0.31%, $0.6412

FOMC Minutes from the October meeting didn’t draw much attention, as it was consistent with the prevailing view about monetary policy since that meeting. U.S. Economic data was limited to the weekly MBA Mortgage Applications Index, which declined 2.2% following a 9.6% increase in the prior week.

In trade, completion of a “phase one” U.S.-China trade deal could slide into next year, trade experts and people close to the White House said, as Beijing presses for more extensive tariff rollbacks, and the Trump administration counters with heightened demands of its own. In addition, the crackdown on Hong Kong protesters may also complicate the deal’s completion. The U.S. Senate passed a bill condemning the crackdown and pledging support for Hong Kong, which was immediately criticized by Beijing.

U.S. Treasuries continued to benefit from a defensive mindset, which sent yields lower in a curve-flattening trade. The 2-yr yield declined two basis points to 1.57%, and the 10-yr yield declined five basis points to 1.74%. The U.S. Dollar Index increased 0.01% to 97.87.

STOCK MARKET WRAP 

S&P500, -0.38%, 3,108.46
Nasdaq, -0.51%, 8,526.73
Nikkei Futures, -0.91%, 23,078.0

S&P 500 declined as much as 0.9% on Wednesday after Reuters reported that a Phase One trade deal may not get completed this year. The negative-sounding headline conflicted with the optimistic tone struck by top White House officials, including Commerce Secretary Ross just yesterday. Also transpiring yesterday was the U.S. Senate passing the Hong Kong Human Rights and Democracy Act, much to the contempt of China.

The trade-sensitive areas of the market like the S&P 500 materials (-1.2%), industrials (-0.8%), and information technology (-0.7%) sectors led the decline. The communication services sector (-0.8%), which contains many growth-oriented stocks underperformed.

Unsurprisingly, though, selling pressure quickly abated as investors eagerly bought the dip. In addition, the details of the report were not as foreboding as the headline, and knee-jerk selling, suggested. Tucked in the report was a line indicating that some “China and trade experts” were still optimistic about a deal in the coming weeks.

Leading the afternoon comeback was the energy sector (+1.0%), which found reprieve amid a 3% rebound in oil prices ($56.91, +1.70, +3.1%). The defensive-oriented utilities (+0.6%), consumer staples (+0.2%), and real estate (+0.03%) sectors also finished in positive territory.

Shares of Target (TGT 126.43, +15.58, +14.1%) climbed 14% after the company impressed investors with its stellar results and upbeat guidance. Lowe’s (LOW 117.83, +4.43, +3.9%) also beat earnings estimates and raised its FY20 EPS guidance.

CURRENCY MARKET WRAP 

As of Tue Nov 19th, Singapore Time zone UTC+8

U.S. Dollar Index, -0.13%, 97.82
USDJPY, -0.03%, $108.67
EURUSD, +0.17%, $1.1072
GBPUSD, +0.21%, $1.2947
USDCAD, -0.17%, $1.3202
AUDUSD, -0.17%, $0.6805
NZDUSD, -0.05%, $0.6396

U.S session began with the market digesting a tweet from a China-based CNBC reporter, who said she was informed by a Chinese government source that Beijing is pessimistic about a trade deal because Trump hasn’t supported a tariff rollback. Based on the modest losses and ensuing price action, the market presumably remained optimistic about a Phase One agreement.

U.S. Treasuries extended last week’s advance, pushing yields slightly lower across the curve. The 2-yr yield declined two basis points to 1.59%, and the 10-yr yield declined three basis points to 1.81%. The U.S. Dollar Index declined 0.13% to 97.82.

STOCK MARKET WRAP 

S&P500, +0.05%, 3,122.03
Nasdaq, +0.11%, 8,549.94
Nikkei Futures, -0.03%, 23,353.0

The large-cap indices eased their way into positive territory thanks to the turnarounds in the S&P 500 consumer discretionary (+0.3%), information technology (+0.3%), and communication services (+0.3%) sectors. Consistent leaders included the consumer staples (+0.5%) and real estate (+0.5%) sectors, as the negative-sounding trade headline likely fostered some conservative-minded interest.

The trade-sensitive industrials (-0.3%) and materials (-0.2%) sectors were among today’s laggards, but their losses were small compared to the 1.3% drop in the energy sector, which was pressured by the decline in oil prices ($57.04, -0.71, -1.2%).

Notable corporate news included HP Inc. (HPQ 20.01, -0.17, -0.8%) turning down the takeover bid from Xerox (XRX 39.30, +0.36, +0.9%). HP remained open to a deal, though. Netflix (NFLX 302.57, +7.54, +2.6%) shares outperformed on speculation that either Carl Icahn or Bill Ackman built a large stake in the company.

CURRENCY MARKET WRAP 

As of Mon Nov 18th, Singapore Time zone UTC+8

U.S. Dollar Index, -0.16%, 98.00
USDJPY, +0.31%, $108.75
EURUSD, +0.27%, $1.1053
GBPUSD, +0.20%, $1.2907
USDCAD, -0.18%, $1.3223
AUDUSD, +0.49%, $0.6820
NZDUSD, +0.30%, $0.6401

U.S. October retail sales increased 0.3% m/m (consensus +0.2%) following an unrevised 0.3% decline in September. Excluding autos, retail sales jumped 0.2% (consensus +0.4%) after declining an unrevised 0.1% decline in September. Industrial production slumped 0.8% in October (consensus -0.4%) on the heels of an upwardly revised 0.3% decline (from -0.4%) in September. The capacity utilisation rate fell to 76.7% (consensus 77.1%) from 77.5% in September.

Stock market rallied higher into record territory on Friday, with risk sentiment fuelled by NEC Director Larry Kudlow saying the U.S. and China are close to reaching a Phase One trade agreement.

U.S. Treasuries didn’t sell off despite the risk-on in the stock market, but they did edge lower. The 2-yr yield increased three basis points to 1.61%, and the 10-yr yield increased two basis points to 1.83%. The U.S. Dollar Index declined 0.16% to 98.00. WTI crude rose 0.9%, or $0.99, to $57.75/bbl.

STOCK MARKET WRAP 

S&P500, +0.77%, 3,120.46
Nasdaq, +0.73%, 8,540.83
Nikkei Futures, +1.07%, 23,367.5

The S&P 500 health care sector did the heavy lifting on Friday, climbing 2.2%, even as the Trump administration announced an initiative to increase price transparency from hospitals and insurers. Investors were evidently unconcerned about the proposal leading to an adverse effect on earnings.

No other S&P 500 sector increased 1.0%, but the continued outperformance of Apple (AAPL 265.76, +3.12, +1.2%), Microsoft (MSFT 149.97, +1.91, +1.3%), and Alphabet (GOOG 1334.87, +23.41, +1.8%) should not be understated. The SPDR S&P Retail ETF (XRT 44.86, +0.44, +1.0%) and Philadelphia Semiconductor Index (+0.9%) also showed relative strength.

Retail stocks extended yesterday’s advance after October retail sales increased 0.3% m/m (consensus +0.2%). Semiconductor stocks benefited from the trade news and the solid results and guidance from Applied Materials (AMAT 62.06, +5.10, +9.0%). Conservative guidance from NVIDIA (NVDA 204.19, -5.60, -2.7%) did limit gains, though.

Interestingly, the trade-sensitive materials sector (-0.1%) was the lone holdout on Friday. Separately, T-Mobile US (TMUS 78.07, +1.23, +1.6%) CEO John Legere is no longer considering the CEO role at WeWork, according to CNBC. Shares of RH (RH 188.47, +13.25, +7.6%) and Occidental Petroleum (OXY 38.95, +1.19, +3.2%) outperformed after Warren Buffet’s Berkshire Hathaway (BRK.B 219.74, +0.38, +0.2%) disclosed new positions in the companies.

CURRENCY MARKET WRAP 

As of Fri Nov 15th, Singapore Time zone UTC+8

U.S. Dollar Index, -0.23%, 98.15
USDJPY, -0.30%, $108.50
EURUSD, +0.12%, $1.1020
GBPUSD, +0.24%, $1.2882
USDCAD, -0.02%, $1.3248
AUDUSD, -0.75%, $0.6787
NZDUSD, -0.48%, $0.6381

U.S. Producer Price Index for final demand jumped 0.4% m/m in October (consensus +0.3%) while the index for final demand, less food and energy, rose 0.3% (consensus +0.2%). The yr/yr change for these measures checked in at 1.1% and 1.6%, respectively, versus 1.4% and 2.0% in September. Initial claims increased by 14,000 to 225,000 (consensus 214,000) for the week ending November 9. Continuing claims for the week ending November 2 decreased by 10,000 to 1.683 million

The 2-yr yield declined five basis points to 1.58%, and the 10-yr yield declined six basis points to 1.82%. The U.S. Dollar Index declined 0.23% to 98.15. Demand for Treasuries may have been driven in part by continued misgivings about a “Phase One” trade agreement, which the U.S. and China are struggling to complete, according to a new report from The Financial Times. The stock market, though, remained undeterred by any negative-sounding trade news that doesn’t come directly from Trump, China, or top negotiators.

Separately, Powell’s final day of testimony on Capitol Hill went largely unnoticed due to it being a reiteration of what the market already knows about monetary policy and the economic outlook.

STOCK MARKET WRAP 

S&P500, +0.08%, 3,096.63
Nasdaq, -0.04%, 8,479.02
Nikkei Futures, -0.59%, 23,162.5

S&P 500 (+0.08%) eked out another record close on Thursday despite Cisco Systems (CSCO 44.91, -3.55, -7.3%) dropping more than 7% after it issued downside quarterly guidance. Cisco blamed familiar macro uncertainties like Brexit and trade for its cautious outlook, but investors construed the situation as a company-specific issue. The broader market held steady throughout the morning, until shares of Walmart (WMT 120.65, -0.33, -0.3%), which were up more than 3% on positive earnings results and an upbeat outlook, turned negative.

Apple (AAPL 262.64, -1.83, -0.7%) was downgraded to Sell from Hold at Maxim Group, which may have contributed to a slight pullback in the stock. Kraft Heinz (KHC 30.96, -1.94, -5.9%) was downgraded to Sell from Neutral at Goldman, which dragged the stock lower.

CURRENCY MARKET WRAP

As of Wed Nov 13th, Singapore Time zone UTC+8

U.S. Dollar Index, +0.13%, 98.33
USDJPY, -0.05%, $109.00
EURUSD, -0.19%, $1.1012
GBPUSD, -0.03%, $1.2851
USDCAD, +0.02%, $1.3235
AUDUSD, -0.12%, $0.6842
NZDUSD, -0.38%, $0.6337

The Treasury market reopened for trading after being closed for Veterans Day yesterday. An uptick in demand pushed the 2-yr yield down one basis point to 1.65% and the 10-yr yield down two basis points to 1.91%. The U.S. Dollar Index increased 0.13% to 98.33. WTI crude was unchanged at $56.85/bbl.

Trump’s lunchtime speech at the Economic Club of New York on Tuesday took aim once again at the Fed for its interest rate policy in a highly anticipated speech that offered no fresh details on his administration’s long-running trade war with China. Trump said U.S. and Chinese negotiators were “close” to a “phase one” trade deal, but largely repeated well-worn rhetoric about China’s “cheating” on trade.

STOCK MARKET WRAP 

S&P500, +0.16%, 3,091.84
Nasdaq, +0.26%, 8,486.09
Nikkei Futures, +0.58%, 23,435.0

S&P 500 clipped the 3100 level for the first time on Tuesday, but the record run lost some steam to leave the benchmark index up just 0.16% and below 3100 on a closing basis. The Nasdaq Composite (+0.3%) closed at a record high, while the Dow Jones Industrial Average (unch) and Russell 2000 (unch) finished unchanged.

The market also received support from the earnings-driven gains in Rockwell Automation (ROK 198.01, +18.81, +10.5%), DXC Technology (DXC 35.25, +5.85, +19.9%), and Tyson Foods (TSN 88.88, +6.15, +7.4%), as well as the healthy gains from Facebook (FB 194.47, +4.86, +2.6%) and Walt Disney (DIS 138.58, +1.84, +1.4%).

Facebook introduced “Facebook Pay,” a feature that will allow users to send payments across its platforms. Disney officially launched its streaming service, which experienced some technical difficulties due to higher-than-expected consumer demand.

CURRENCY MARKET WRAP 

As of Tue Nov 12th, Singapore Time zone UTC+8

U.S. Dollar Index, -0.14%, 98.21
USDJPY, -0.15%, $109.04
EURUSD, +0.11%, $1.1034
GBPUSD, +0.47%, $1.2854
USDCAD, +0.05%, $1.3233
AUDUSD, -0.13%, $0.6848
NZDUSD, +0.51%, $0.6363

U.S. Treasury market and banks were closed for Veterans Day and investors did not receive any economic data. The U.S. Dollar Index declined 0.14% to 98.21. WTI crude declined 0.6% to $56.88/bbl.

In UK, Britain’s economy has grown at the slowest annual rate in almost a decade, according to official figures. Year-on-year growth in the three months to end-September slowed to 1% from 1.3% in the second quarter, the Office for National Statistics said. While the economy dodged outright recession, the rebound in quarterly growth was smaller than expected. UK Prelim GDP q/q expanded by 0.3% in the third quarter, it was not as fast as the 0.4% forecast by economists.

STOCK MARKET WRAP 

S&P500, -0.20%, 3,087.01
Nasdaq, -0.13%, 8,464.28
Nikkei Futures, -0.45%, 23,327.5

S&P 500 declined just 0.2% on Monday, while the Dow Jones Industrial Average (+0.04%) eked out a record close amid strength in Boeing (BA 366.96, +15.96, +4.6%) and Walgreens Boots Alliance (WBA 62.25, +3.01, +5.1%). The Nasdaq Composite lost 0.13%, and the Russell 2000 lost 0.3%.

Boeing said it expects 737 MAX deliveries to resume in December and commercial service to resume in January. Walgreens received a leveraged buyout offer from KKR & Co. (KKR 29.26, +0.11, +0.4%), according to Bloomberg.

The nice gain in Boeing was an influential driver not only in the Dow but also the S&P 500 industrials sector (+0.1%), which joined the real estate (+0.2%) and information technology (+0.1%) sectors in positive territory. The tech sector overcame a negative start, predominately due to Apple (AAPL 262.20, +2.06, +0.8%) extending its record run on no specific catalyst.

Separately, T-Mobile US (TMUS 79.62, -1.32, -1.6%) was a notable laggard after The Wall Street Journal reported that its CEO John Legere is in talks to become the next CEO of WeWork. Qualcomm (QCOM 91.84, -2.19, -2.3%) underperformed after the stock was downgraded to Equal-Weight from Overweight at Morgan Stanley.