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Market Update - 07/09/16

Wednesday, September 7, 2016

Disclaimer: This is an informal commentary by one of our Market Analysts. It should not be taken as investment advice and is made available only on that basis.
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US: The S&P closed +0.3%, +0.32% from the London close, on volumes +8% vs. the 30 day average. U.S. equities closed in the blue. A disappointing ISM number  initially sent the market lower whilst also sending the odds of a September hike to 24%. On the back of the weak ISM number and weaker expectations for a Fed rate hike in September 10y yields declined 7bps to 1.54% and DXY fell 1.04%. The commodities complex was stronger with Oil up 0.99% and Gold +1.69%. Energy, Utilities and Real Estate led the market higher. Financials the greatest laggard, followed by Industrial and Materials.

ASIA: Japanese stocks fell as the yen gained sharply against the dollar, weighing on exporters. China flat, HK China Enterprises Index breaks above 10K level for first time since Dec 15.

Kennedy Wilson - to dispose of 4 high street retail properties in Dublin, is not a surprise say Davys - expected price €14.5m; management has flagged a further €200m of disposals (at results time), most of which are non-core, small lots.

US prosecutors are considering criminal charge against unit of HSBC in US relating to conduct on it’s FX desk, which could imperil an earlier deal that let the bank avoid prosecution.

Large deal in US yesterday as Canada’s Enbridge and Texas based Spectra Energy, pipeline companies, worth $28bn.

Federal Reserve Bank of San Francisco President John Williams painted an upbeat picture of the U.S. economy in a speech on Tuesday, despite recent disappointing data that’s led investors to reduce their bets on an interest-rate increase later this month.

Apple , new iPhone to be introduced today and be available to consumers in mid-September.

Sports Direct profit warning with EBITDA for 2017 expected to be in the region of £300m (cons £322m)

Ackman’s Pershing Square reports stake in Chipotle.

US$ fell to lowest level versus Yen in two weeks as data yesterday dimmed prospects of rate hike this month.

Some banks changing their bearish bets on Sterling after good numbers, Deutsche exits its short term bet, while retaining a longer term negative view.

Amazon , Facebook hit new record highs, with Google not far behind, 75% of the FANG’s back in vogue.

Construction worker shortage weighs on hot U.S. housing market

ECB QE extension could re-open tensions within the Governing Council; FT

U.S. regulators allow BlackRock funds to lend to one another

Markets slow after open, Europe – 6 BPs