The Wednesday Market Minute

  • Global stocks mixed, with shares in Asia hitting a 14-month low while Europe booked modest gains, as the trade war overhang continues to pin down risk sentiment.
  • U.S. equity futures point to 30-point opening bell gains for the Dow Jones Industrial Average as investors key on Apple's annual product launch later today in California.
  • Oil prices near $80 as Russia's oil minister calls U.S. sanctions on Iranian crude "huge uncertainty" for global markets.
  • U.S. 10-year Treasury yields ease from multi-week highs ahead of $38 billion auction later today, but 3% threshold beckons after JOLT data shows job openings at the highest level on record.

Market Snapshot

Global stocks struggled to find momentum again Wednesday, as markets in Asia fell to a fourteen month low amid concerns over the latest developments in the U.S.-China trade war, but Apple Inc.'s AAPL much-anticipated product launch looks set to support U.S. markets as investors await the release of three new iPhones.

With China seeking permission from the WTO to impose $7 billion worth of sanctions onto U.S. imports, linked to an anti-dumping dispute from 2013, and President Donald Trump vowing yesterday to take a "tough stance" in trade negotiations with Beijing, investors are finding it difficult to see any meaningful conclusion to a major risk factor that has hung over global markets for several months.

The trade-related caution, however, has had a much bigger impact on stocks in Asia, which traded at the lowest level since July 2017 this morning as the MSCI ex-Japan index fell 0.31%, led once again by weakness in China, and Japan's Nikkei 225 gave back 0.27% to close at 22,604.61 points.

U.S. equity futures were equally subdued, although contracts tied to the Dow Jones Industrial Average were indicating a modest 10 point gain at the opening bell while those liked to the S&P 500 suggesting little change from last night's close of 2,887.89 points for the broader benchmark. 

The Nasdaq Composite index is expected to gain around 8 points at the start of trading today, with investors likely keying on Apple Inc.s (AAPL) annual product event at its campus in Cupertino, Calif.

Apple shares extended gains in pre-market trading, following their biggest advance in more than a month, as investors prepare for the expected launch of three new iPhones that could boost the average selling price of the group's most important product to just under $800.

Action Alerts Plus holding Apple shares were marked 0.5% higher in pre-market trading in New York Wednesday, following yesterday's 2.53% gain, indicating an opening bell price of $224.97 each, a move that would take the stock's year-to-date gain to around 33% and value the group at just over $1.08 trillion.

European stocks were also firmer at the opening bell, thanks in part to a weakening euro, which slipped to 1.1585 against the U.S. dollar ahead of tomorrow's European Central Bank policy meeting in Frankfurt, as the Stoxx 600 index gained 0.21% by mid-day in Frankfurt to trade at 376.08 points with basic resource and energy stocks leading the advance.

Britain's FTSE 100 was marked 0.19% higher by earning afternoon in London as the slipped to 1.3003 against the dollar, during a state of the union address in European Parliament by European Commission President Jean-Claude Juncker, who said the bloc would not stand in the way of Britain's orderly withdraw from the EU.

Rising oil prices were part of the reason that energy stocks got an early morning boost, as looming U.S. sanctions on the sale of Iranian crude, which are set to come into effect in November, have pushed prices closer to $80 a barrel.

U.S. oil prices were also supported by a modestly weaker dollar, which slipped to 95.17 against a basket of six global currencies, and data from the American Petroleum Institute which showed that domestic crude stocks fell by 8.6 million barrels, slipping under the the 400 million barrel mark, for the week ending on September 6.

Brent crude prices for November delivery were marked 25 cents higher from their Tuesday close in New York and changing hands at $79.31 per barrel in early European trading while WTI contracts for the same month were see 67 cents higher at $69.64 per barrel.

Rising U.S. oil prices, and the concurrent gains expected in domestic gasoline costs, has investors concerns that faster domestic inflation could follow recent data from the labor market, where August wages rose the most in nine years, according the Commerce Department, and job openings in July hit .9 million, the highest on record.

Still, benchmark 10-year U.S. Treasury bond yields eased modestly in overnight trading, with the notes marked at 2.974% in early European trading, down from the 2.98% seen yesterday, as investors positioned themselves for $38 billion in new supply from a government auction later today.