GLOBAL MARKET SNAPSHOT
Global indices finished mixed on Thursday though momentum was positive. The session finished with the Americas posting solid gains (e.g., U.S. 0.8%, Canada 0.7%, Brazil 1.0%). U.S. markets experienced a cyclical rally with materials 1.7%, industrials 1.7%, and energy 1.0% leading. This afternoon S&P 500 surged 0.9% in 10 minutes on a WSJ report that U.S. officials were considering lifting its trade tariffs on China, a report that was swiftly denied by Treasury but gives an indication of how the market will react if there is a resolution to the trade issue.
Treasuries were weaker in the belly as yields in the 5- to 10-year part of the curve rose 3 bps, while credit continued to strengthen.
The U.S. dollar index was flat. British pound had its best day in over a month, rallying 0.8% as sentiment continues to seesaw on Brexit. Hungarian forint 0.6% led among emerging market crosses as markets price a more hawkish outlook for monetary policy.
The Bloomberg Commodity Index gained 0.2%. Grains jumped on the trade headlines with soybeans and wheat finished 1.5% and 1.7% higher, respectively. Crude oil was largely unchanged on the day but rallied back from down -2.5% intraday.
The Philadelphia Fed’s manufacturing business outlook gave a boost to the market and offset some of concern arising from yesterday’s Beige Book. The headline index for manufacturing activity in the region increased 7.9 points to 17.0, well above expectations, as 30% of manufacturers reported an increase in activity and new orders rose to a six-month high.
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