Morning Minutes 8/7/2020

Morning Minutes

Stocks Slide Amid Mixed Trade, Earnings and Employment News

August 7, 2020

At SIA Wealth Management everything we do is based on Relative Strength Analysis. We evaluate the Relative Strength between asset classes giving us insight into money flows on a large scale, and from this select top ranked investments.

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

Stock markets around the world have been sliding into the weekend as investors consider a mixed bag of market related news. US index futures are all down about 0.4%, giving back some of yesterday’s gains, while overseas, the Dax and FTSE are down slightly, the Nikkei fell 0.4% and the Hang Seng dropped 1.6%. In currency action, gold is flat while Silver is down 0.5%, while the US Dollar is up 0.3%-0.5% against the Canadian Dollar, British Pound and Euro. Commodities are soft today with copper falling 1.3% and WTI crude oil sinking 1.2%.

There has been a lot of mixed news for investors to digest overnight. The headline news, North American employment numbers, has just come out and was better than expected with both US nonfarm payrolls (1.76M vs street 1.60M)      Canadian jobs (418K vs street 400K) beating the street in July, but US index futures have only moved up slightly on the news.

There also have been a number of developments on the political and trade fronts. While US lawmakers continue to haggle over a new fiscal stimulus package, President Trump has ratcheted up trade tensions on two fronts, slapping new aluminum tariffs on Canada and signing an executive order banning transactions with the Chinese parent companies of TikTok and WeChat starting in 45 days. On the flip side, China posted positive trade numbers overnight including a stronger than expected trade surplus ($62.3B vs street $42.0B), boosted by stronger than expected exports (7.2% over year vs street -0.2%).

Overnight earnings have been mixed, providing a reminder that travel related companies continue to face challenging conditions. Uber reported a worse than expected loss per share (-$1.02 vs street -$0.81). Ride sharing revenues plunged 67% but were offset by a 103% increase in food delivery revenues. Meanwhile, travel sites Booking.com (-$10.81 vs street -$11.50) and TripAdvisor (-$0.76 vs street -$0.63) both reported significant losses for the quarter. On the other hand, Groupon is up 33.8% in premarket trading after reporting significantly stronger than expected EPS ($0.93 vs street -$2.75), and T-Mobile US also beat the street ($0.09 vs street $0.07).

Disclaimer: SIA Wealth Management Inc. (SIAWM) specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investor’s investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIAWM nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.

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At SIA Wealth Management everything we do is based on Relative Strength Analysis. We evaluate the Relative Strength between asset classes giving us insight into money flows on a large scale, and from this select top ranked investments.

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

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Disclaimer: SIA Wealth Management Inc. (SIAWM) specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investor’s investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIAWM nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.