Wall Street Yet To Get Over Brexit Hangover

WASHINGTON (Alliance News) – Early indications suggest that Wall Street stocks may open Monday’s session lower, as traders still brood over last Friday’s EU referendum outcome. However, earlier in the global trading day, Asian stocks exhibited resilience. The Japanese market found support from intervention chatter. Meanwhile, European markets are retreating steeply. With the corporate and economic calendar light, the markets could find difficulty shrugging off Brexit-related weakness. However, bargain hunting could offer some support, as the major averages trade at their lowest level in over 2 months.

As of 6:15 am ET, the Dow futures are declining 88 points, the S&P 500 futures are slipping 10 points and the Nasdaq 100 futures are receding 26.50 points.

US stocks retreated in the week ended June 24th, recoiling to their lowest level in more than 2 months, weighed down by the unexpected verdict given by Britons to exit the EU

After the Brexit storm that raged all of last week, things on Main Street could settle down this week. In the unfolding week, the spotlight is likely to be on Federal Reserve Chair Janet Yellen’s public speech scheduled for Wednesday, the Conference Board’s consumer confidence reading due on Tuesday, the Commerce Department’s personal income and spending data for May and the National Association of Realtors’ pending home sales index for May, both due on Wednesday, the results of MNI Indicators’ Chicago region business barometer survey for June, scheduled for Thursday and the results of the Institute for Supply Management’s national manufacturing survey for June due on Friday.

lash estimate of Markit’s US service sector survey for June, S&P/Case-Shiller house price survey for April, the routinely scheduled weekly jobless claims data, Markit’s final US manufacturing PMI for June and some Fed speeches are among the other closely watched data of the week. The results of some regional manufacturing surveys, final first quarter GDP estimate and the Commerce Department’s construction spending report for May round up the economic events of the week.

The Dallas Federal Reserve is set to release its regional general activity index for June at 10:30 am ET. The index was at -20.8 in May and the production index was at -13.1.

In major corporate news, Intel (INTC) is reportedly looking to sell its cyber-security business it purchased 6 years ago for USD7.7 billion, with the suitors speculated to be companies including McAfee.

Most Asian markets rebounded following Friday’s sell-off, with the Japanese and Chinese markets rising strongly. On the other hand, some major markets such as Hong Kong and Taiwan recorded modest losses.

The Japanese market rallied, as government officials continued to signal that currency intervention is on the anvil. The Nikkei 225 average opened higher moved roughly sideways for much off the session. The index added 357.119 points or 2.39% before ending at 15,309.

Australia’s All Ordinaries, which saw some indecision till early afternoon trading, moved decisively into positive territory thereafter. The average stayed afloat in the rest of the session, ending up 23.40 points or 0.45% at 5,216.

China’s Shanghai Composite Index jumped 41.42 points or 1.45% to 2,896 but Hong Kong’s Hang Seng Index closed at 20,227, down 31.83 points or 0.16%.

On the economic front, profits off Chinese industrial firms increased further in May, though at a slower pace than in the previous month, data from the National Bureau of Statistics showed. Industrial profits grew 3.7% from a year ago to 537.2 billion yuan in May following a 4.2% gain in April.

With fears of the ramifications of the Brexit playing out in the minds of traders, European markets continue to bleed. The major averages in the region opened notably lower and are seen holding their losses.??

In major corporate news, easyJet lowered its third quarter revenue per seat guidance, citing cancellations due to disruption events, including Egyptian tragedy. Fresenius said that its Supervisory Board appointed Stephan Sturm as CEO as of July 1, 2016, replacing Ulf Mark Schneider, who has decided to leave the company effective June 30, 2016 to pursue another opportunity. The company also confirmed its guidance for 2016.

Data released by the European Central Bank showed that money supply growth in the eurozone rose 4.9% year-over-year in May following a 4.6% increase in April. Economists had expected 4.8% growth.

Copyright RTT News/dpa-AFX

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