Monday July 9th

9-07-2018

Dow set to rise more than 100 points as trade turmoil takes a breather

U.S. stock index futures posted solid gains ahead of Monday’s open, supported by positive trade overseas and a strong jobs report published Friday. Around 7 a.m. ET, Dow Jones Industrial Average futures popped 111 points, indicating a higher open of 124.52 points. Nasdaq 100 and the S&P 500 futures also indicated an upbeat start to their respective trading sessions. Markets have been given a boost following the publication Friday of the latest jobs report, which revealed that the U.S. economy added 213,000 jobs in June, beating expectations. This positive sentiment seen across markets is in spite of concerns surrounding trade and Brexit. The U.S. placed $34 billion of tariffs on Chinese goods on Friday, a move that triggered China to hit back with its own set of duties. And the U.K.’s Brexit Secretary David Davis announced late Sunday that he was resigning from his post, as he wasn’t prepared to be “a reluctant conscript” to Prime Minister Theresa May’s plans to leave the European Union (EU). On Friday, May had reached a Brexit compromise with her cabinet, persuading ministers to back her intention to press for “a free trade area for goods” with the EU. On Monday, Dominic Raab was appointed as the new Brexit Secretary. On Monday, consumer credit is due out at 3 p.m. ET, while personal and household products company Helen of Troy is expected to publish its latest earnings. Asian shares closed higher on Monday, taking cues from Wall Street's advance following the release of strong employment data for the month of June. Meanwhile, investors continued to keep an eye on trade after the U.S. and China exchanged tariffs last week. Japan's Nikkei 225 rose 1.21 percent, or 264.04 points, to close at 22,052.18. The broader Topix advanced 1.2 percent. Elsewhere, the Kospi saw slimmer gains in South Korea, rising by 0.57 percent to end at 2,285.80 as tech stocks climbed while manufacturers declined. Greater China markets rallied, outperforming other regional markets. Hong Kong's Hang Seng Index advanced 1.5 percent by 3:08 p.m. HK/SIN. On the mainland, the Shanghai composite rose 2.49 percent to close at 2,815.51 as banks and insurers notched gains. The smaller Shenzhen composite gained 2.51 percent to end at 1,574.54 and the blue-chip CSI 300 index surged 2.8 percent. Oil prices steadied on Monday as an increase in U.S. drilling, likely to lead to higher shale production, balanced evidence of tightening supply. Benchmark Brent was up 40 cents at $77.51 a barrel by 0750 GMT. U.S. crude was down 10 cents at $73.70. Gold extended its recovery on Monday, touching the strongest in nearly two weeks as the dollar weakened, the Chinese yuan rebounded and some investors reversed their bearish gold bets. Spot gold was up 0.9 percent at $1,265.39 an ounce, its highest since June 26. U.S. gold futures for August delivery rose 0.8 percent to $1,266.40 an ounce.