Morning Brief: Dow Jones and DAX Index rise as Tesla Profits While Daimler Loss Mounts

Asia-Pacific stocks were mixed today as traders continued to focus on the simmering tensions between the United States and China. In Australia, the ASX rose by 0.35% while in New Zealand, the DJ New Zealand declined by 0.40%. Meanwhile, in Hong Kong, the Hang Seng rose by 0.60% while in the mainland, the Shanghai composite fell by 0.25%. Japan markets were closed as the country celebrated the Marine day.

US futures jump on upbeat earnings

Futures tied to the Dow Jones, Nasdaq, and S&P 500, are in the green today as traders react to the upbeat earnings from Tesla, Microsoft, and Chipotle. Tesla shares are up by more than 4% in premarket trading after the country reported upbeat earnings. The company made more than $6 billion in the second quarter and a profit of more than $104 million. That was the fourth quarter of profits in a row.

Microsoft, on the other hand, reported a 13% increase in earnings despite the pandemic. This revenue grows was mostly due to a 47% jump in the important cloud segment. However, the company’s decision to close stores had an impact on its earnings.  Its other top movers were in Xbox content and services and Office 365.

Later today, the Dow Jones, Nasdaq, and S&P 500 will react to the simmering US-China tensions and key corporate earnings. Companies to watch will be Amazon, Intel, AT&T, Unilever, Danaher, and Kimberley-Clark, among others. The chart below shows the performance of the Dow Jones and Nasdaq in the past month.

Dow Jones
Dow Jones, Nasdaq, and S&P 500 one-month performance

Europe stocks are mixed

European stocks are mixed today as traders react to corporate earnings from several countries. In Germany, the blue chip DAX index is up by 0.26%. Daimler, the owner of Mercedes, is the biggest mover in the index.

The shares have jumped even after the company reported a $2.2 billion loss in the second quarter. This loss followed another 1.24 billion euros loss in the first quarter. Also, the firm shipped 542,000 cars in the quarter, down from 822,000 in the previous quarter.

Covestro, another member of the DAX index posted a net loss of 52 million euros in the quarter. It had a net income of 189 million euros. Its shares are little changed today.

Meanwhile, in the UK, the FTSE 100 index is up by 0.30% while in Switzerland, the SMI index is down by 0.18%. The chart below shows how the DAX index, FTSE 100, and Stoxx 50 have performed in the past month.

DAX Index
DAX Index, FTSE 100, Stoxx 50

Currencies little changed today

Global currencies are seeing mild movements today. This is understandable considering that the economic calendar is a bit flat. The only major thing happening is the Turkish Central Bank interest rate decision. We will also receive the initial jobless claims data from the US. The impacts of these claims will be mild considering that investors are thinking about the rising new cases and stimulus package. The chart below shows the performance of the EURUSD, AUDUSD, and USDTRY.


Commodities in the green today

The Bloomberg Commodities Index (BCOM) is in the green today. It has gained by 0.35%, continuing the rally that has remained in the past few months. This growth is mostly because of gold price that is up by 0.54% today. Brent and WTI crude oil pricehave jumped by 0.35% while natural gas has gained by 0.90% while copper is up by 0.35%.

These commodities will react to the ongoing cold war between the United States and China. As I reported earlier, China has identified the Chengdu embassy as the best one to close following the decision by the US to close the Houston embassy.

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