General Daily Market Recap – August 29, 2024

Financial markets have been eagerly awaiting the preliminary US GDP release for most of the day, and the numbers did not disappoint!

Improvements in growth and inflation numbers were announced, triggering risk flows and some gains for Treasury yields and also the dollar.

Read on to find out what other stocks have impacted asset classes during recent trading sessions:

Titles:

• ANZ New Zealand Business Confidence Index it jumped from 27.1 to 50.6 in August
• Australian private equity spending fell 2.2% q/q in Q2 2024 vs. forecast 0.9% growth, previous reading up from 1.0% to 1.9%
• Japanese Consumer Confidence Index it held steady at 36.7 versus the expected increase to 36.9
• Spanish flash CPI slowed from 2.8% y/y to 2.2% in July vs. estimate of 2.4%
• German preliminary CPI showed a 0.1% m/m decline in July vs. an expected 0.2% rise, previously gained 0.3%
• US GDP Q2 2024 has been updated from an advanced reading of 2.8% q/q to 3.0% due to stronger consumer spending, the price index was revised higher from an initial 2.3% to 2.5% q/q
• The U.S. goods trade deficit widened from $96.6 billion to $102.7 billion, compared with an expected deficit of $97.7 billion
• US Initial Jobless Claims at 231K for the week ending Aug. 22 versus the previous forecast of 232,000, 233,000
• US pending home sales fell a steeper 5.5% m/m in July to its lowest level since 2001 as high borrowing costs hurt sentiment
• Jordan’s SNB chief says weak eurozone demand is weakening Swiss export activity
• Nagel, ECB official and head of the Bundesbank suggested there should be no rush to cut again as inflation fell short of the 2% target.

Broad Market Price Action:

Dollar Index, Gold, S&P 500, Oil, US 10 Year Yield, Bitcoin Overlay Chart by TradingView

Major asset classes started the day off on a cool note as investors likely awaited the release of the second version of US GDP. Volatility rose slightly early in the London session, sending both crude oil and US bond yields lower, while bitcoin continued its steady rise.

Improvements in both the US growth figure and the price index for Q2 2024 sparked a rally in risk assets such as crude oil and stocks as the numbers appeared to calm concerns about a slowdown and a rise in the dollar and Treasury yields due to optimistic expectations for Friday. PCE base version.

On the other hand, gold prices took a hit on viewing the preliminary GDP report, although the precious metal managed to keep its head above water as it bounced back quickly after the initial dip. BTC/USD, on the other hand, touched a ceiling of $61,000 and pulled back near $59,000 before the end of the US session.

US stocks also struggled to hold on to their post-GDP gains before the closing bell, with the S&P 500 and Nasdaq ending roughly flat for the day.

Currency Market Behavior: US Dollar vs. Majors:

USD chart overlay against major currencies by TradingView

Most major pairs got off to a generally slow start, with the exception of NZD/USD, which rallied early in the Asian session thanks to a notable improvement in the New Zealand business confidence index for August.

The dollar edged lower against most of its peers for most of the Asian trading session, with the exception of the Japanese yen, which was likely held back by a lack of improvement in the country’s consumer confidence index for July.

Weaker-than-expected inflation data from eurozone economies, namely Germany and Spain, sent the single currency lower, along with other European currencies, around the start of the session in London.

A bit more consolidation followed, before the dollar rallied broadly throughout the day on updates from the preliminary reading of US Q2 2024 GDP. The initial jobless claims figure also came in slightly better than expected expected, at 231,000 versus the forecast of 232,000.

However, the US currency later pared most of its post-GDP gains as the pending home sales report reflected a sharp decline to record lows due to higher borrowing costs. However, the greenback managed to close in the green against the yen and European currencies, as well as the Canadian dollar.

Future potential catalysts for the economic calendar:

• Australian retail sales at 1:30 GMT
• German retail sales and import prices at 6:00 GMT
• French preliminary GDP and CPI at 6:45 GMT
• KOF Swiss Economic Barometer at 7:00 GMT
• German unemployment rate at 7:55 GMT
• CPI flash estimates for the euro area at 9:00 GMT
• Canadian GDP at 12:30 GMT
• US PCE core price index at 12:30 GMT
• Chicago PMI at 1:45pm GMT
• The UoM consumer sentiment index revised up the US at 14:00 GMT

Today could be all about inflation updates as the Eurozone prepares to print its flash headline and core CPI readings for July, which could weigh on ECB policy expectations.

Uncle Sam is also due to release the core PCE price index, which is said to be the Fed’s preferred measure of inflation, so you better stay tuned for further financial market volatility and earnings activity at the end of the month !

And if you trade multiple major currency pairs at the same time, be aware of currency correlations to avoid accidentally over-exposing your trading account to higher-than-expected risks.