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Market Wrap: Stocks, Bonds, Commodities |
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On Tuesday, U.S. stocks closed higher following cooler-than-expected inflation data, with the S&P 500 advancing 28 points (+0.38%) to 7,543, the Nasdaq 100 up 322 points (+1.10%) to 29,586, and the Dow Jones up 9 points (+0.02%) to 52,508.
The U.S. inflation rate slowed to 3.5% year-on-year in June (versus 3.9% expected) as energy prices eased. Core inflation also slowed, to 2.6% year-on-year, against expectations of a steady 2.9%.
The U.S. 10-year Treasury yield retreated 3.7 basis points to 4.587%.
SK Hynix (SKHY) posted a strong rebound of 27.29% after retreating 9% in the prior session.
Other semiconductor and data-storage stocks also rebounded. Nvidia (NVDA) rising 4.06%, Micron (MU) up 4.92%, Intel (INTC) up 4.50%, Advanced Micro Devices (AMD) up 2.57%, and Sandisk (SNDK) up 5.01%.
International Business Machines (IBM) plummeted 25.21%, its biggest one-day loss on record. The company released a weaker-than-expected earnings report, attributing the softness in its software and infrastructure business to clients’ shifting spending toward hardware purchases such as memory chips.
Bank earnings were mixed. Goldman Sachs (GS) jumped 9.00%, JPMorgan Chase (JPM) climbed 2.50%, and Bank of America (BAC) rose 1.88% after all three reported better-than-expected second-quarter results. Citigroup (C), however, fell 5.29%, and Wells Fargo (WFC) dropped 2.71%.
Bitcoin's rally lifted related stocks, with Strategy (MSTR) gaining 5.95% and Coinbase (COIN) up 2.62%.
In Europe, the DAX 40 gained 0.13% and the FTSE 100 added 0.30%, while the CAC 40 was largely flat.
U.S. WTI crude futures rose for a second session, up 1.20 dollars (+1.54%) to 79.34 dollars a barrel.
Gold held above the key level of 4,000 dollars an ounce.
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The U.S. dollar weakened across the board. Soft inflation data tempered expectations that the Federal Reserve would need to raise interest rates.
Speaking to a House panel, Federal Reserve Chair Kevin Warsh said that if the central bank gets its policy right, the inflation surge of the past five years will be a thing of the past.
EUR/USD rose 39 pips to 1.1420, GBP/USD climbed 41 pips to 1.3387, and AUD/USD was up 55 pips to 0.6971.
USD/JPY retreated 19 pips to 162.23 and USD/CHF fell 51 pips to 0.8093.
USD/CAD lost 91 pips to a 1-month low at 1.4063.
Bitcoin jumped more than 4% to 64,800 dollars, its highest level since June 22.
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In Asian trading hours, USD/JPY slipped to 162.07. Japan's machinery orders dropped 12.4% month-on-month in May, compared with -3.0% estimated.
On the other hand, China's gross domestic product grew 4.3% year-on-year in the second quarter, below 4.6% expected.
Meanwhile, EUR/USD climbed to 1.1440 and GBP/USD rose to 1.3407.
Gold fell to 4,040 dollars.
Bitcoin eased to 64,483 dollars.
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The eurozone's industrial production is expected to grow 0.3% month-on-month in May.
In the U.S., producer price index is estimated to be up 6.3% year-on-year in June, while the Empire State manufacturing index is expected to climb to 6.2 in July. Also, the Federal Reserve chairman Kevin Warsh will testify before the Senate.
The Bank of Canada is expected to keep its benchmark rate unchanged at 2.25%.
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