STOCKS CLOSE FLAT: Here's what you need to know
Siu Chiu/ Reuters
US stocks opened at all time highs, slipped into the red, and finally closed the day more or less unchanged.
"With little new news it’s been another decent 24 hours for markets as the concoction of abating Brexit concerns, elevated central bank stimulus expectations and Friday’s reassuring payrolls number proves to be a winning formula for now," said Deutsche Bank's Jim Reid in a note earlier on Wednesday.
And now, let's head to the scoreboard:
- Dow: 18,372.12 (+0.1%)
- S&P 500: 2,152.43 (+0.0%)
- Nasdaq: 5,005.73 (-0.3%)
- WTI crude oil: $45.15 (-3.5%)
- 10-year Treasury yield: 1.471 (-2.8%)
1. The Fed is generally pleased with the economy. The Fed was out with its latest Beige Book, a collection of economic anecdotes compiled on or before July 1 from its 12 districts. It highlighted further tightness in the labor market, with "the strongest pressures linked to skilled workers and difficult-to-fill positions." Moreover, the housing market continued to improve, and many districts were upbeat about future conditions, although most of them continued to report tight inventories.
2. The Bank of Canada cut growth forecast during a "climate of heightened uncertainty." The Bank of Canada's left its key rate unchanged at 0.5%, as expected. It also revised down its economic growth forecast for the country: it now expects growth to clock in at 1.3%, down from a previous forecast of 1.7% in 2016, and at 2.2% in 2017, down from the previous estimate of 2.3%.
3. Theresa May is the UK's new prime minister after David Cameron stepped down. She said she will lead a "one-nation" government dedicated to social justice and making "Britain a country that works for everyone." Oh, and Boris Johnson, who was originally seen as the favorite to succeed Cameron, is now the new foreign secretary.
4. Oil production hit its highest level in 8 years. The International Energy Agency says OPEC oil output rose by 400 kilo barrels a day in June to an eight-year high of 33.21 million barrels a day. The increase in production comes as Saudi Arabia pumped oil out at a near record rate of 10.45 mb/d and as production in Nigeria picks back up, according to the IEA.
5. Shot seller Andrew Left is back to shorting Valeant. According to an interview with James Passeri at The Street, Left has entered into a short position against the troubled pharmaceutical company that he helped bring down last October.
6. The yen is strengthening again, while the pound is falling again. In the immediate aftermath of the Brexit vote, the yen appreciated against the dollar, while the pound fell. On Monday and Tuesday of this week, we saw a reversal where the yen started to weaken against the green back, while the pound strengthened. In the early afternoon ET time, the currencies once again switched back to their post-Brexit postures. Notably, a stronger yen is bad news for Japan.
7. Yum brands beats on earnings, raises guidance. After the market closed on Wednesday, Yum Brands reported second-quarter earnings that topped forecasts, but sales that missed expectations. It reported $0.75 in adjusted earnings per share (EPS), on revenues of $3.01 billion. And it boosted its core operating profit growth guidance to at least 14%.
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