AvaTrade | Aug 18, 2017 06:56AM ET
There were again multiple events that shook the markets yesterday. First, it was reported that Gary Cohn, the chief economic advisor to President Trump would be stepping down, which started a drop in equities. This rumor was quickly dispelled and as such, we saw the markets correct when news broke of the terror attack in Barcelona, Spain. This led to another downturn in the markets which continued as news continued to come in.
h3 Currencies/h3EUR/USD – moved down as from the ECB monetary policy meeting minutes it became clear that there are some in the ECB that are worried about the recent rise of the EUR and the effect that could have on growth. The weaker than expected data out of the US weakened the USD a bit so the largest losses of the EUR were parted a bit. The terror attack in Spain did not have an impact on the EUR.
USD/JPY – dropped below the 110 level again after having failed to breach the resistance level just below the 111 level the previous day. The JPY gained strength after the USD started to weaken after some soft US data and the JPY strengthened further due to a demand for safe havens after the terror attack in Spain.
Dollar Index – moved up as the EUR and GBP lost ground against the USD, but later in the day gave up some of its gains as there was an influx to safe havens and out of the USD, fueled by the terror attack in Spain and due to weak data out of the US and also helped by the doubts on progress on the economic plans of the administration.
S&P 500 – dropped to the lowest level in over a month with all sectors in red on the backdrop of the rumors that chief economic advisor Gary Cohn would resign and the terror attack in Spain. This started a selloff which continued until the end of the session and as such we closed at the lowest level of the day. The continued doubts on the ability of the administration to deliver on its tax and infrastructure agenda are also weakening the S&P.
Gold – with risk off in the markets which leads to an increased demand for safe havens, combined with a weaker USD, gold moved up again and remains trading close to the highest levels of the year.
Alibaba (NYSE:BABA) – reported better than expected earnings with a revenue of $7.4 billion an expected revenue of $7.1 billion. What was also positive was that sales in China were still growing. Alibaba moved up despite negative market sentiment due to the terror attack in Spain.
Cisco – dropped 4% even though revenue came in more or less as expected and showed a drop in sales and revenue compared to the same period last year and also forecasts a drop in revenue for the first quarter of 2018 between 1%-3%.
Snapchat – is trying to recover from the new record low is posted after its earnings, and is doing so successfully so far and has closed the gap which occurred due to its earnings.
Snapchat – continues to recover and has closed the gap after its earnings report.
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