JASPER’S MARKET SQUAWK 23-08-2023

<h2>Disappointing Retailer Earnings Weigh on Sentiment</h2>
<p>Despite starting the day in the green, US indices fell after disappointing retailer earnings data and another downgrade in US banks. Gold and dollar rose, with the latter weighing on the euro.</p>
<p><img decoding="async" loading="lazy" class="alignnone size-full wp-image-25157" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-6.png" alt="" width="1754" height="836" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-6.png 1754w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-6-300×143.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-6-1024×488.png 1024w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-6-768×366.png 768w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-6-1536×732.png 1536w" sizes="(max-width: 1754px) 100vw, 1754px" /></p>
<p>Chart: Gold</p>
<h2>Key Factors for Today</h2>
<ul>
<li>Disappointing Retailer Earnings Shake US Stock Market</li>
<li>Tech Sector Holds Steady Amidst Poor US Retail Sales</li>
<li>Euro Takes a Hit as Dollar Rises on Dismal Sentiment</li>
<li>API Reports Small Inventory Draw, WTI Oil Prices Fall</li>
<li>Yuan Fixing Gives AUDUSD a Boost Despite Major Currencies’ Decline</li>
<li>Pound Drops as UK Public Finances Turn into Deficit</li>
</ul>
<h2>US Retailers Weigh on Sentiment, But Tech Holds</h2>
<p>Several major US retailers reported disappointing sales and guidance, weighing on market sentiment. S&amp;P cut its credit reading for 5 US banks. The Nasdaq was seen escaping the doldrums as traders anticipate Nvdia’s earnings on Wednesday. After a spike to 15k, it closed largely unchanged, leaving a tail and opening up speculation for declines towards 14750.</p>
<h2>EUR/USD Lower as Investors Seek Refuge</h2>
<p>US existing home sales in July came in at 4.1M compared to the 4.2M expected, while the Richmond Fed manufacturing index was slightly better than expected but still negative at -7 compared to the -10 forecast. Both gold and the dollar rose as investors sought safer bets during a disappointing session, with the rise in USD sending the eurodollar rate 0.50% lower after bulls failed to defend $1.09. At June lows, bulls may have to deal with a $1.08 leg next as an advance towards $1.0930 seems less likely.</p>
<h2>API Reports Small Inventories Draw, WTI Falls</h2>
<p>The API survey showed a drawdown of -2.4M bbl, in line with the 2.3M bbl expected and compared to the -6.2M in the prior week. Reports circulated that Turkey and Iraq have not agreed to restart oil transit, while Egypt announced a new oil discovery in the Gulf of Suez. Tropical Storm Harrold passed into the Texas mainland without major disruption to supply, with the remaining storms in the Caribbean seen dissipating. WTI fell back under the $80/bbl handle, with expected support lower down at $87.50/bbl. Bulls may face resistance past $81/bbl.</p>
<h2>Yuan Fixing Supports AUDUSD Despite Majors’ Drop</h2>
<p>The Australian dollar was among the best performers of the major currencies against the dollar after the PBOC fixed the onshore exchange rate firmer, in the largest gap between the fixing and the market expectation in history. AUD/USD rose to $0.6422 on Tuesday and is seen ticking higher early Wednesday, leaving behind support at $.64.</p>
<p>BHP said that the outlook for commodity prices depended on China’s recovery prospects.</p>
<h2>Pound Lower After UK Public Finances Turn to Deficit</h2>
<p>The UK’s public finances fell to -£7.5B from +11.3B previously, with press reports that the Treasury had transferred £14.3B to the BOE to cover losses from bonds. CBI Industrial trends orders were -15 compared to -12 expected, but selling prices were seen as high and potentially maintaining inflation pressure. Cable lost 0.18% to $1.2732, moving away from the day’s high of $1.28 with next support at $1.27 partially on the dollar’s strength. A run past the top may see bullish bets increase.</p>
<h2>On The Docket</h2>
<ul>
<li>EA HCOB PMIs</li>
<li>UK S&amp;P Global/CIPS PMIs</li>
<li>CA Retail Sales</li>
<li>US S&amp;P Global PMIs</li>
<li>New Home Sales</li>
<li>EIA Crude Oil Stocks Change</li>
<li>BRICS Summit</li>
<li>ES Consumer Confidence</li>
</ul>
<h2>FX 1-Day Relative Performance (USD)</h2>
<ul>
<li>Aussie 0.27% up, Kiwi at +0.10%</li>
<li>Euro and Pound 0.15% higher</li>
<li>Yen 0.13% up, Swissy half way there</li>
<li>Loonie 0.08% higher</li>
<li>Gold 0.41% up, Silver spikes 1.09% higher</li>
<li>Crude and Brent 0.18% and 0.14% up</li>
<li>Natural gas 0.12% lower</li>
</ul>
<p>The post <a rel="nofollow" href="https://www.keytomarkets.com/blog/analysis/jaspers-market-squawk-23-08-2023-25153/">JASPER’S MARKET SQUAWK 23-08-2023</a> appeared first on <a rel="nofollow" href="https://www.keytomarkets.com/blog">Key To Markets Blog</a>.</p>