August 12th, 2015
Daily Market Commentary
ECONOMIC NEWS
- MBA Mortgage Applications in the U.S. were up 0.1%.
- Industrial Production in the Eurozone was down 0.4% and up 1.2%.
Commodities:
- The global oil glut will last through next year as surging demand and faltering supply growth fail to clear the surplus, according to the International Energy Agency.
- Nickel plunged to the lowest level since 2008 while copper and aluminum slipped to six-year lows as China’s yuan headed for the biggest two-day drop in two decades.
- Following the biggest monthly drop in two years, gold has risen almost every day in August. China’s yuan devaluation has sparked safe-haven demand and added to concern that more countries will weaken their currencies. Gold for immediate delivery climbed for a fifth day, the longest run since May, and increased as much as 1 percent to $1,120.02 an ounce.
Canada:
- Canada’s stagnating economy could force its central bank to deploy the type of extraordinary stimulus adopted in the U.S., Europe and Japan, according to BlackRock Inc., the world’s biggest money manager.
- Canada’s election in October has become yet another event shaping the seven-year saga of the Keystone XL pipeline, one that may lead the Obama administration to delay announcing a decision to approve or reject the $8 billion project.
United States:
- U.S. stock-index futures dropped, indicating the Standard & Poor’s 500 Index will fall for a second day, on concern China’s woes will hamper the global economic recovery.
- Capital One Financial Corp. agreed to buy General Electric Co.’s health-care finance unit for about $9 billion, as the bank best known for its credit cards builds a niche business into one of the industry’s largest.
International:
- European stocks fell the most in six weeks, with autos, miners and consumer-goods companies sensitive to China sliding as the yuan’s devaluation continued to roil global markets.
- Government bonds surged in developed nations around the world, pushing the yield on German two-year notes to a record low, as China’s devaluation of the yuan for a second day added to concern that the world’s second-largest economy is faltering and will curb global growth.
- Daimler AG is the latest company to try and skirt the uniquely French law, introduced in 2000 by the then-Socialist government. The German company wants workers at one of its two French factories to put in more hours, hinting that it’ll take operations elsewhere if no accord is reached.
- The yuan sank for a second day, spurring China’s central bank to intervene as the biggest rout since 1994 tested the government’s resolve to give market forces more sway in determining the exchange rate.
*All information is taken from Bloomberg, unless otherwise noted.
