Morning Minutes 6/4/2020

Morning Minutes

Steady Stocks Digest ECB Stimulus Expansion

June 4, 2020

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Market Commentary By:
Colin Cieszynski, CFA, CMT
Chief Market Strategist
ccieszynski@siawm.com
+1 (647) 282-4428

Coming off of two straight days of gains on anticipation of potential new stimulus in Europe, economic reopenings and US economic reports, stocks appear to have paused for a rest with much of the news now out.

The European Central Bank announced an additional €600 Billion in asset purchases, more than the €500B the street had been expecting and also extended the asset purchase program through to June 2021. Also today, Germany announced a €130 B fiscal stimulus package. The Dax and FTSE are both down 0.2% as investors weigh this news while the Euro is flat relative to the US Dollar.

US employment numbers were mixed this morning. Weekly initial jobless claims dropped below 2 million for the first time since mid-March, but at 1.877 million, were higher than the 1.800 million street estimate. Continuing claims were 21.487M, higher than the 20.05M the street had expected. This slightly disappointing news offsets yesterday’s better than expected ADP payrolls report, leaving mixed indications ahead of tomorrow’s US nonfarm payrolls and Canadian employment reports. On these developments, US index futures are down 0.1%-0.3% with Dow futures down 42 points.

Crude oil is backsliding a bit today with WTI down 1.4% and Brent down 0.8%. Anticipation that an OPEC+ meeting scheduled for next week could be moved up to this week and anticipation of an extension or deeper cuts has faded amid chatter about cheating on quotas, suggesting more work may need to be done to get all the different players on side.

 

New Video: Market Commentary and Portfolio Update – June 3, 2020

With Jeremy Fehr – Founder and CEO of SIA Wealth Management

A new webinar replay is available featuring Jeremy Fehr, founder of SIACharts and SIA Wealth, discussing current trends in world markets. A PDF version of the presentation is available.

GoToMeeting Version: https://attendee.gotowebinar.com/recording/464339560924760579

YouTube Version: https://youtu.be/em_ImjhV_3g

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