Morning Brief: Stocks Retreat On Profit Taking – Crude Oil Higher

Asian indices retract today as investors book some profits following the recent strong rally that drove Asian stocks close to two-year highs. Wall Street indices continue to make all-time highs, and only Dow Jones ended in the red yesterday.

News that we are getting closer to a coronavirus vaccine and an improvement in trade relations between China and the USA has boosted stocks.

However, the weak economic data from the USA showed that the economic recovery has slowed down in August. U.S. consumer confidence dropped to six-year lows, surprising analysts who expected an improvement.

New home sales in the U.S. increased by 13.9% in July, topping the expectations of 1.3%.

The main dish of the week is Jerome Powell’s speech in the annual symposium in Jackson Hole. Analysts expect the Federal Reserve to revise the inflation target upwards and any signal for the future monetary policy path.

Japan Leading Economic Index Below Expectations

Nikkei 225 ended marginally lower after the Japan Leading Economic Index came in at 84.4, below the expectations of 85 in June. Meanwhile the Coincident Index came in at 76.6, beating the forecasts of 76.4. A Reuters poll of analysts and fund managers showed that the median estimate for Nikkei 225 is at 23,000 for the end of the year.

In Australia, the ASX 200 index finished 0.73% lower at 6,116, giving up its gains for the week. The index yesterday stalled at five-month highs at the 6,200 strong resistance.

The Singapore Straits Times index is 0.57% lower at 2,541. The Shanghai Composite index is 1.30% lower at 3,329, while the Hang Seng shed 0.22% at 25,427.

Gold Price Under pressure

Gold price is lower for the fourth consecutive day, approaching the lowest level since August 13. Risk-on sentiment has pushed Nasdaq and S&P 500 to record highs while traders are taking some profits from gold after the recent rally to all-time highs. Gold is 0.85% lower at 1,914. Silver price is 1.08% lower at 26.21.

Gold Price Daily Chart

Hurricane Season Lift Crude Oil Prices 

Crude oil price trades at five-month highs as hurricanes approach the Gulf of Mexico and local authorities are evacuating oil facilities. The WTI oil futures are 0.12% higher at $43.39. Brent crude oil is 0.19% higher at $46.03. 

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