Stocks Kicked Off Q3 Strong

STATE OF THE MARKETS

Stocks kicked off Q3 strong. US stocks kicked off the third quarter of the year strong, with Dow (+0.38%) and Russell (+0.81%) climbing higher, while Nasdaq (+0.13%) and S&P (+0.52%) were in record territory. Investors seemed more optimistic when US unemployment claims reported (364k) less than expected (400k), prompting more flows into the 10Y (yielding 1.46%) than 2Y (yielding 0.25%) US bonds.

In the commodities market, crude broke the $75/bl mark for the first time in 33 months, after OPEC+ was reported not to drastically increase production. Gold on the other hand,  inched higher to regain the $1,780/oz handle, as investors bet that Feds might not be able to hike rate as soon as expected.

In the FX space, King Dollar seized the helm of demand across all horizons, while Sterling and Loonie were offered on the short term and medium term accounts. Long and medium term accounts still see risk off as Yen and Swiss are more in demand than the comdolls. Markets look forward to seeing better NFP numbers (680k vs 559k) on Friday to confirm the decrease in unemployment claims on Thursday.

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G8 CURRENCIES SENTIMENTS

** ST refers to Short-Term daily turnover, MT is Medium Term weekly 
and LT refers to Long-Term monthly turnover.

WALL ST MOST ACTIVE

** % Change here refer to price

WALL ST TOP FLOWS

** % change here refers to volume

TOP 5 BLOCK ORDERS

OUR PICK – No new pick

No new picks going into the weekend. What was interesting to note after a week of capital inflows into US equities, there was no selling pressure as the major indexes climbed higher. What was even more interesting this week, was the fact that long term US investors continue to cash out ($4.36b) from both domestic ($2.985b) and foreign ($1.375b) equities as they climbed higher. This is consistent with our FX sentiments index that points to risk off among medium to long term accounts. They say do not fight the Feds, but if you are long equities, consider it as short term, because when no one else is buying; we know what that means. Have a wonderful weekend!

Trades updates:  We will continue to accumulate AUY as the stock now pays dividends yielding 2.51% at current price, we remain bullish T and will accumulate as dividends yields now at 7.15%, we may close AUD/NZD short for now as we see potential rebound next week, we remain bullish CLVS, we remain short GPRO, EUR/JPY has reached TP1 and we may re-initiate short next week, USD/JPY short was stopped out, we remain bullish VIPS and bearish APA.

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Disclaimer:

This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.