US open Stocks to head lower in worst weekly performance in 2 months

US futures

Dow futures -0.4% at 34743

S&P futures -0.36% at 4390

Nasdaq futures -0.15% at 14906

In Europe

FTSE +0.03% at 7052

Dax -0.32% at 15698

Euro Stoxx -0.08% at 4120

Learn more about trading indices

Risk off dominates

US stocks are pointing to lower open on Friday putting the SP500 & Dow Jones on track for the worst weekly performance in 2 months.

Risk aversion has dominated across the week amid fears that the Fed will start tapering bond purchases as covid cases rise globally. The prospect of the Fed reining in support as new covid restrictions in some countries slow the global economic recovery is proving too much for the market to handle.

Safe havens have outperformed across the week whilst riskier assets such as stocks have tanked. Cyclicals have underperformed tech stocks.

Adding to the downbeat mood China continues with its regulatory crack down. The Hang Seng tumbled another 1.8% hitting a 10-month low. Chinese stocks listed in the US will be under the spotlight.

Safe havens have outperformed across the week whilst riskier assets such as stocks have tanked.

Where next for the S&P 500?

The S&P 500 is resuming losses after a mild bounce in the previous session. Yesterday’s move higher saw the S&P500 close over its 200 sma on the 4 hour chart which could bring some optimism to the buyers, as well as well as the receding bearish bias on the MACD. For now, the price is back testing the 200 sma at 4400. A break below this level could open the door to 4350 yesterday’s low before 4230 the July low comes into focus. On the upside resistance at 4440 the 50 sma with a push above here opening the door to 4475 and fresh all-time high.

FX – USD at 9 ½ month highs, GBP tumbles as retail sales fall

The US Dollar is on the rise extending gains from the previous session and hitting a fresh 9 ½ year high against major peers as investors seek safety. Fears are growing that the rise in COVID cases could dampen the economic recovery just as central banks are starting to rein in stimulus.

GBP/USD- the Pound trades under pressure after weaker than forecast retail sales data. UK retail sales unexpectedly fell -2.5% MoM in June, well below the 0.3% growth forecast. Retail sales tumbled as covid cases rose and Pingdom sent more and more people into isolation.

GBP/USD -0.22% at 1.3606

EUR/USD -0.06% at 1.1670

Oil moves lower for a fourth straight session

Oil prices have picked up off three-month lows but are still trading down around 5% across the week. Rising covid cases, tougher lockdown restrictions particularly in China Japan, Australia and New Zealand is raining concerns over the health of the economic recovery and weighing on the demand outlook.

US crude trades -0.92% at $62.90

Brent trades -0.88% at $65.70

Learn more about trading oil here.

The complete guide to trading oil markets

Looking ahead

18:00 Baker Hughes rig count

How to trade with City Index

Follow these easy steps to start trading with City Index today:

Open a City Index account, or log-in if you’re already a customer.
Search for the market you want to trade in our award-winning platform.
Choose your position and size, and your stop and limit levels
Place the trade.

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.cityindex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.

ALL TRADING INVOLVES RISKS. LOSSES CAN EXCEED DEPOSITS.

City Index is a trading name of StoneX Financial Pte. Ltd. (“SFP”) for the offering of dealing services in Contracts for Differences (“CFD”). SFP holds a Capital Markets Services Licence issued by the Monetary Authority of Singapore for Dealing in Exchange-Traded Derivatives Contracts, Over-the-Counter Derivatives Contracts, and Spot Foreign Exchange Contracts for the Purposes of Leveraged Foreign Exchange Trading. SFP is also both Derivatives Trading and Clearing member of the Singapore Exchange (“SGX”). SFP is a wholly-owned subsidiary of StoneX Group Inc.

The information provided herein is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to invest, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk.

The information does not represent an offer of, or solicitation for, a transaction in any investment product. Any views and opinions expressed may be changed without an update. To understand the risks and costs involved, please visit the section captioned “Important Information” and the “Risk Disclosure Statement”.

The information herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

StoneX Financial Pte. Ltd. 1 Raffles Place, #18-61, One Raffles Place Tower 2, Singapore 048616. Tel: 6309 1000. Co. Reg. No.: 201130598R.

This advertisement has not been reviewed by the Monetary Authority of Singapore.