Oleksandr Pylypenko
11 min read
September S&P 500 E-Mini futures (ESU25) are up +0.47%, and September Nasdaq 100 E-Mini futures (NQU25) are up +0.70% this morning, pointing to a higher open on Wall Street amid optimism over progress in trade negotiations between the U.S. and key partners.
Japan’s top trade negotiator, Ryosei Akazawa, extended his stay in the U.S. for further talks, stating that negotiations have reached “a critical juncture.” Also, Bloomberg reported that India’s trade delegation prolonged its stay in Washington to iron out differences as both sides aim to finalize a deal ahead of the July 9th deadline. In addition, Canada withdrew its digital services tax on tech firms in an effort to restart trade negotiations with the U.S. Taiwan also said it has made “constructive progress” during a second round of trade negotiations with the U.S. Finally, French Finance Minister Eric Lombard stated that the European Union could reach some type of trade deal with the U.S. ahead of the July 9th deadline.
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This week, investors look ahead to remarks from Federal Reserve Chair Jerome Powell and a raft of U.S. economic data, with a particular focus on the nonfarm payrolls report.
In Friday’s trading session, Wall Street’s major equity averages ended in the green, with the S&P 500 and Nasdaq 100 notching new all-time highs. Nike (NKE) surged over +15% and was the top percentage gainer on the S&P 500 and Dow after the sportswear company posted better-than-expected FQ4 results and said it expects the decline in sales and margins to ease in the current quarter. Also, Boeing (BA) climbed more than +5% after Redburn upgraded the stock to Buy from Neutral with a price target of $275. In addition, Alphabet (GOOGL) rose over +2% after Citizens JMP upgraded the stock to Outperform from Market Perform with a price target of $220. On the bearish side, Palantir Technologies (PLTR) slumped more than -9% and was the top percentage loser on the S&P 500 and Nasdaq 100 after Canada announced a tax on digital business from the U.S.
Data from the U.S. Department of Commerce released on Friday showed that the core PCE price index, a key inflation gauge monitored by the Fed, came in at +0.2% m/m and +2.7% y/y in May, stronger than expectations of +0.1% m/m and +2.6% y/y. Also, U.S. May personal spending unexpectedly fell -0.1% m/m, weaker than expectations of +0.1% m/m, and personal income unexpectedly fell -0.4% m/m, weaker than expectations of +0.3% m/m. At the same time, the University of Michigan’s U.S. June consumer sentiment index was unexpectedly revised higher to 60.7, stronger than expectations of 60.4.
