The CML Close - Tech up, oil down, US dollar up, inflation expectations plummet - 07-05-2022
Markets
Stocks bounced off of lows and ended the day mostly up, with technology showing substantial strength and the Dow Jones Industrial Average dropping.
Biden may drop Trump era tariffs on China, the U.S. dollar's strength continues, new U.S. factory orders rose, and inflation expectations are plummeting.
| • SPX | 3,831.39 | +6.06 | (+0.16%) |
| • NASD | 11,322.24 | +194.39 | (+1.75%) |
| • DJIA | 30,967.82 | -129.44 | (-0.42%) |
| • R2K | 1,741.33 | +13.57 | (+0.79%) |
| • VIX | 27.54 | +0.01 | (+0.04%) |
| • Oil | 99.60 | -8.83 | (-8.14%) |
• Tariffs on China may be eased.
• Recession talks are the new focus.
• New orders for US manufactured goods came in far above estimates.
Headlines of the Day
Stock Market Cuts Losses as Former Faves Become Favorites Once Again
Bad news is good news as recession fears helped lift former winners like Nvidia, Alphabet, and Netflix.
Biden Dropping China Tariffs Could Be Good News for Tech Stocks
If President Joe Biden rolls back tariffs on Chinese exports, it could have bigger implications than the impact on inflation.
Citi Says Oil May Collapse to $65 by the Year-End on Recession
That outlook is based on an absence of any intervention by OPEC+ producers and a decline in oil investments, analysts including Francesco Martoccia and Ed Morse said in a report.
Recession Fear Drives Greenback to Strongest Level Since 2020
The dollar surged to its strongest level in more than two years as growing concern about recession prompted investors to pile into haven assets and riskier currencies from Hungary to Colombia were smashed in a day of busy trading.
Economic Data Results for 7-5-2022
Factory Orders MoM MAY
New orders for US manufactured goods jumped 1.6% month-over-month in May of 2022, following an upwardly revised 0.7% rise in April and beating market forecasts of a 0.5% gain, in a sign demand for products remained strong.
Factory Orders ex Transportation MAY
Factory Orders Excluding Transportation in the United States increased 1.70 percent month-over-month in May of 2022, following an upwardly revised 0.6 percent rise in April.
United States Inflation Expectations
While recent macro data indicates a rapid deceleration in global economy, potential silver lining may be accompanying drop in inflation expectations; after rising more than 3.7% in late March, the 5-year breakeven inflation rate has fallen more than 1% to 2.7% as of Friday.
Commodity Prices
The futures' pries for wheat, copper, iron ore, and cotton are plummeting.
Economic Data Due Tomorrow on 7-6-2022
S&P Global Services PMI Final JUN
S&P Global Composite PMI Final JUN
ISM Non-Manufacturing PMI JUN
JOLTs Job Openings MAY
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