Originally published by Rivkin Securities
After a holiday on Tuesday, trading in the US stock markets was relatively subdued overnight with both the Dow and S&P 500 tracking close to unchanged for most of the session although financials and tech stocks outperformed. The Nasdaq 100 bounced after spending the last month in a downtrend while energy stocks were hammered as WTI oil fell back to a $45 handle. The drop in oil came as a result of Russia hinting it would not support any further production cuts after the current ones expire in March next year. The fall in oil came despite the American Petroleum Institute releasing data indicating a much larger than expected drawdown in both crude and gasoline inventories last week although this news did help WTI bounce off its lows.
The Tesla (NASDAQ:TSLA) share price fell 7.5% last night as the company reported fewer sales this quarter than last. The TSLA price is now down around 15% from its peak reached on June 23 as the market starts to fear the ambitious sales targets set by CEO Elon Musk will not be achieved.
The minutes of the last Fed meeting were released early this morning which showed that the FOMC is still maintaining a hawkish bent. Some officials are concerned that the low interest rates are leading to a build-up of risks in the economy. Market expectations remain for one more interest rate hike this year, most likely occurring in December. The timing of balance sheet reductions was also discussed with September still in play for a start to the process.
The S&P/ASX 200 had a quiet session yesterday with no leads from the US to follow, however it held on to most of the large gains made the prior day. Today, futures are pointing to a higher open.
Data releases:
- Australia Trade Balance 11:30am AEST
- US ADP Employment Change 10:15pm AEST
- US ISM Non-manufacturing PMI 12:00am AEST