Yesterday was an uneventful day, but perhaps that's what the market needs right now. US equity indices finished flat on the session, and it was a similar picture in Europe where the biggest gain among major indices was 0.60% from the Italian MIB.
Sellers seemed to have the upper hand in the US yesterday, with decliners outnumbering advancers by more than 2:1 on the NYSE and Nasdaq exchanges. Sales volume was also dominant.
Gold on the up
In the commodity markets, it was gold that held traders’ attention yesterday, helped in part by earnings from one of the world's biggest gold miners, Barrick Gold. The company rallied by more than 9% on the day amid news that it is looking for further mining opportunities in Canada. The Vaneck Gold Miners ETF added 2.96% and its junior mining stablemate added 3.66% on the session. The yellow metal is up by 3.3% over the last week, though there hasn't been any follow-through in early European trade this morning, where the spot price has fallen by 0.55%.
Insurers and utilities led the Euro STOXX 50 on Monday. RWE and EO.N added 1.7% and 0.82%, respectively, while Generali and Munich Re were up by 1.35% and 1.01% respectively. Consumer discretionary stocks came under pressure, with luxury brand Kering down 1.85%, L’Oreal down 1.59% and Adidas dropping 1%. Automakers BMW, Mercedes and VW also lost ground.
Nvidia and Super Micro Computer were among the biggest gainers in the S&P 500 yesterday, up by 4.08% and 6.33% respectively, though the outright winner was Key Corp, which jumped by more than 9.1% as Scotia Bank announced its intention to acquire a 14.9% stake in the business.
The US banking sector has had its share of problems in recent times, but last week’s volatility largely passed it by. The regional banking ETF KRE is up by around 3.79% over the last quarter, for example.
Meanwhile, the Nikkei 225 rallied by 3.18% in Tuesday’s session and is now back near the levels it was trading at before last Monday’s meltdown.
UK unemployment rate edges lower
This morning’s UK employment data was a positive surprise, showing a decrease in unemployment from 4.4% to 4.2% in the quarter to June, beating market expectations of an increase to 4.5%. These figures were boosted by an increase in part-time jobs, many of which were in the health and social care sector. Pay also rose, with the median monthly salary up £5.60, which could give the Bank of England pause for thought going forward.
Despite that, the pound edged higher against the US dollar, trading up by 0.23% this morning with the FTSE 100 making similar gains. Stocks of interest in the UK top flight include AstraZeneca, which set a new 52-week high yesterday, and BT Group, which saw more than four times its average daily volume traded, as French billionaire Patrick Drahi agreed to sell a near 25% stake in the business to an Indian telecoms group.
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