In Asian Equity Markets Japan’s Nikkei index posted modest gains on Wednesday, supported by strong earnings reports from local companies and by a rally in Apple suppliers after it reported robust profits. The Nikkei was up 0.4 percent at 20,058.24 points by mid-morning, after rising 0.3 percent on Tuesday. The broader Topix advanced 0.2 percent to 1,631.61 and the JPX-Nikkei Index 400 added 0.2 percent to 14,524.34.  The MSCI’s broadest index of Asia-Pacific stocks outside Japan steady near its highest since late 2007. Hong Kong’s Hang Seng Index climbed 0.57 percent and the Shanghai Composite edged up 0.13 percent.

 

In Currency Markets the dollar extended its modest bounce from 15-month lows on Wednesday, benefiting from a pause in selling of the battered currency as investors begin positioning for key events this week, notably Friday’s U.S. employment report. The euro was unchanged at $1.1806 after being nudged away from a 2-1/2-year peak of $1.1846 set the previous day. The U.S. currency was 0.15 percent higher at 110.535 yen, pulling away from a near seven-week low of 109.920 touched overnight. The New Zealand dollar fell to a one-week low of $0.7416 and was last down 0.5 percent at $0.7427 following lacklustre data. The Australian dollar as down 0.2 percent at $0.7953.

 

In Commodities Markets oil prices fell 1 percent on Wednesday, with rising U.S. fuel inventories pulling U.S. crude back below $50 per barrel, while ongoing high OPEC supplies weighed on international prices. U.S. West Texas Intermediate crude was at $48.69 per barrel, down 1 percent, from its last settlement. Brent crude was down almost 1 percent at $51.31 per barrel. The American Petroleum Institute’s (API) said that U.S. crude stocks rose by 1.8 million barrels in the week ending July 28 to 488.8 million, denting hopes that recent inventory draws were a sign of a tightening U.S. market.  Spot gold lost 0.3 percent to $1,264.88 per ounce and silver fell 0.6 percent to $16.60 per ounce.

 

In US Equity Markets   the Dow Jones Industrial Average racked up a fifth straight record high on Tuesday and neared the 22,000 mark, powered by Goldman Sachs, JPMorgan Chase and other banks. The Dow rose 0.33 percent to a record-high close of 21,963.92. The S&P 500 gained 0.24 percent to 2,476.35 and the Nasdaq Composite added 0.23 percent to 6,362.94. The S&P financial index led with a gain of 0.81 percent. JPMorgan Chase rose 1.34 percent and Goldman Sachs added 0.74 percent. Under Armour  fell 10.38 percent to a record low after the sportswear maker cut its full-year sales forecast. Automaker Ford fell 2.41 percent and General Motors lost 3.39 percent after they reported lower monthly sales.

 

In Bond Markets U.S. Treasury yields fell on Tuesday as weak auto sales raised concerns about slow economic growth, before Friday’s highly anticipated employment report for July. Benchmark 10-year notes rose 10/32 in price to yield 2.26 percent, down from 2.29 percent late on Monday. Data on Tuesday showed that a measure of U.S. factory activity fell from a near three-year high, setting the economy on a moderate growth path in the third quarter. A separate report showed that inflation remains low.

 

 

Economic Calendar

• 09:30 GMT+1 UK Construction PMI
• 13:15 GMT+1 US ADP Non-Farm Employment Change
• 15:30 GMT+1 US Crude Oil Inventories

 

US Equity Upgrades

• AMERICAN AIRLINES (AAL) UPGRADED TO OVERWEIGHT FROM NEUTRAL AT JPMORGAN
• AMERICAN AIRLINES (AAL) UPGRADED TO OVERWEIGHT FROM NEUTRAL AT JPMORGAN
• ASTRAZENECA (AZN) UPGRADED TO HOLD FROM SELL AT PARETO
• CABOT OIL & GAS (COG) UPGRADED TO OVERWEIGHT FROM EQUAL WEIGHT AT MORGAN STANLEY
• CIRCOR (CIR) UPGRADED TO BUY FROM HOLD AT SUNTRUST
• COUSINS PROPERTIES (CUZ) UPGRADED TO BUY FROM HOLD AT STIFEL
• CREDIT ACCEPTANCE (CACC) UPGRADED TO MARKET PERFORM FROM UNDERPERFORM AT RAYMOND JAMES
• CREDIT ACCEPTANCE (CACC) UPGRADED TO MARKET PERFORM FROM UNDERPERFORM AT RAYMOND JAMES
• DISCOVERY (DISCA) UPGRADED TO BUY FROM NEUTRAL AT CITI
• HILLTOP HOLDINGS (HTH) UPGRADED TO BUY FROM NEUTRAL AT COMPASS POINT
• HILLTOP HOLDINGS (HTH) UPGRADED TO BUY FROM NEUTRAL AT COMPASS POINT
• NATIONAL GRID (NGG) UPGRADED TO BUY FROM HOLD AT BERENBERG
• ROCKWELL COLLINS (COL) UPGRADED TO BUY FROM HOLD AT CANACCORD
• ROCKWELL COLLINS (COL) UPGRADED TO BUY FROM HOLD AT CANACCORD
• SCANA (SCG) UPGRADED TO OVERWEIGHT FROM EQUAL WEIGHT AT BARCLAYS
• SCRIPPS NETWORKS (SNI) UPGRADED TO NEUTRAL FROM SELL AT CITI
• SOUTHERN COMPANY (SO) UPGRADED TO BUY FROM HOLD AT DEUTSCHE BANK
• SPIRIT AIRLINES (SAVE) UPGRADED TO OVERWEIGHT FROM NEUTRAL AT JPMORGAN
• SPIRIT AIRLINES (SAVE) UPGRADED TO OVERWEIGHT FROM NEUTRAL AT JPMORGAN

 

US Equity Downgrades

• BOARDWALK PIPELINE DOWNGRADED TO SECTOR PERFORM FROM OUTPERFORM AT RBC CAPITAL
• CORPORATE OFFICE PROPERTIES (OFC) DOWNGRADED TO SELL FROM HOLD AT STIFEL
• OIL STATES (OIS) DOWNGRADED TO NEUTRAL FROM BUY AT GUGGENHEIM
• REGENERON (REGN) DOWNGRADED TO UNDERPERFORM FROM NEUTRAL AT BAIRD
• SCRIPPS NETWORKS (SNI) DOWNGRADED TO HOLD FROM BUY AT NEEDHAMDISCOVERY

 

US Equity Initiations

• CELLDEX (CLDX) ASSUMED WITH A BUY AT H.C. WAINWRIGHT
• CENTENNIAL RESOURCE DEVELOPMENT (CDEV) INITIATED WITH AN OVERWEIGHT AT JPMORGAN
• CRITEO (CRTO) INITIATED WITH AN OUTPERFORM AT BMO CAPITAL
• HAIN (HAIN) CELESTIAL INITIATED WITH A HOLD AT LOOP CAPITAL
• NEOS THERAPEUTICS (NEOS) INITIATED WITH AN OVERWEIGHT AT CANTOR
• SALESFORCE INITIATED (CRM) WITH AN OUTPERFORM AT CREDIT SUISSE