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IN-THE-MARKETS

In the Markets – Week-Ending July 8

by Peter J. Creedon

Newsletter: In the Markets – Week-Ending July 8
Crystal Brook Advisors
We Make Financial Planning Crystal Clear

United States: US 10-year and 30-year Treasury yields hit new lows.(1) Looking to speed up early morning trading in times of market stress, the SEC has approved plans by the NYSE to eliminate Rule 48.(2)

Europe: London Stock Exchange shareholders approve Deutsche Börse Merger after Britain voted to leave the EU.(3) UBS is ordered by tax authorities in Switzerland to share clients’ account information With France.(4)

Asia: The yield on the 10-year Japanese government bond hit a record low minus 0.262 per cent on Tuesday, while the yield on the 20-year note has fallen to zero for the first time ever.(5) The Brexit vote that upended global markets and is also helping the Chinese yuan depreciate—as many economists say it needs to do, given the country’s economic slowdown.(6)

Monday 07/04 (Independence Day)

• After two consecutive monthly increases, Brazil’s industrial production remained unchanged in May (0.0% MoM) to an annual drop of 7.8% YoY (vs. -6.9% YoY in April).(7)
• According to the Mexican Institute of Executives in Finance (IMEF), domestic economic activity may slow down further than expected ahead as, while the manufacturing IMEF index dropped 3.9 points to 47.5 in June, the services index lost 3.0 points to 47.8.(8)

Tuesday 07/05

• U.S. stock index futures are indicating a lower open after being closed yesterday for July 4.(9)
• The U.S. holds more oil reserves (264B barrels) than Saudi Arabia (212B) and Russia (256B), the first time it has surpassed those held by the world’s biggest exporting nations, according to a new study by Rystad Energy.(10)

Wednesday 07/06

• Global stocks extended losses and the British pound continued to fall to levels not seen in over 30 years as uncertainty following the U.K.’s vote to exit the EU compounded worries about global growth. (11)
• In addition to the surging currency, Japan’s 20-year government bond yield fell below zero for the first time ever and the 30-year was just 0.015%.(12)

Thursday 07/07

• Stock markets steadied as investors refocused their attention on the U.S. economy and the Federal Reserve.(13)
• Danone has agreed to buy WhiteWave Foods, maker of Horizon Organic milk, for about $10 billion, a deal that would hand it a slice of the growing market for plant-based dairy alternatives.(14)

Friday 07/08

• U.S. stocks rose Friday, returning to where they were before the U.K.’s vote to leave the European Union. The gains were sparked by a stronger-than-expected report on U.S. jobs growth that mollified investor concerns about an economic slowdown.(15)
• Ignoring the volatility, the three-month trend is at 147,000 jobs, with service sector job gains but a weaker trend in goods production. Meanwhile, wages are rising, but continue at a slower pace than prior expansions.(16)
 

Market Close
U.S. stocks rallied Friday on the back of robust jobs report, with the S&P 500 finishing a hair’s breadth away from its record close. Labor Department data showed U.S. companies added 287,000 jobs in June, helping to restore confidence in the economy. The S&P 500 SPX, +1.53% rose 32 points, or 1.5%, to end at 2,129.83, coming within a point of its record of 2,130.82 on May 21, 2015. The Dow Jones Industrial Average [s:DJIA] climbed 251 points, or 1.4%, to end at 18,146–reclaiming the key 18,000 level for the first time in two weeks. The Nasdaq COMP, +1.64% rallied 80 points, or 1.6%, to finish at 4,956.(17)

Contributor: Oscar Xia

Sources:
(1) Source: Financial Times
(2) Source: Seeking Alpha
(3) Source: New York Times
(4) Source: New York Times
(5) Source: Financial Times
(6) Source: Wall Street Journal
(7) Source: Seeking Alpha
(8) Source: Seeking Alpha
(9) Source: Seeking Alpha
(10) Source: Seeking Alpha
(11) Source: Wall Street Journal
(12) Source: Seeking Alpha
(13) Source: Wall Street Journal
(14) Source: Wall Street Journal
(15) Source: Wall Street Journal
(16) Source: Wells Fargo Economics Group
(17) Source: MarketWatch