US STOCKS: Extending Lows, Potential DOJ Antitrust Suit vs AAPL
Stocks extending session lows, trading desks citing headline from Politico that the DOJ is drafting a possible antitrust suit against Apple (AAPL, currently -5.08, -2.99% at 164.95).
- "The Justice Department has been investigating Apple since 2019 over allegations that it abused its market power to stifle app developers and competing hardware makers and a suit has become increasingly likely, the report said, adding that the move to drafting sections of the suit is "a significant step forward in the process." Politico.
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OUTLOOK: Thursday Data Calendar, Weekly Claims, GDP, 7Y Note Sale
- US Data/Speaker Calendar (prior, estimate)
- Jul-28 0830 Initial Jobless Claims (251k, 250k)
- Jul-28 0830 Continuing Claims (1.384m, 1.386m)
- Jul-28 0830 Personal Consumption (1.8%, 1.2%)
- Jul-28 0830 GDP Price Index (8.2%, 8.0%)
- Jul-28 0830 GDP Annualized QoQ (-1.6%, 0.4%)
- Jul-28 0830 Core PCE QoQ (5.2%, 4.4%)
- Jul-28 1000 KC Fed mfg index (12, 3)
- Jul-28 1130 US Tsy $55B 4W, $50B 8W bill auctions
- Jul-28 1300 US Tsy $38B 7Y note auction (91282CFC0)
AUDUSD TECHS: Corrective Cycle Still In Play
- RES 4: 0.7202 High Jun 9
- RES 3: 0.7141 76.4% retracement of the Jun 3 - Jul 14 downleg
- RES 2: 0.7069 High Jun 16
- RES 1: 0.6983 High Jul 26
- PRICE: 0.6929 @ 16:25 BST Jul 27
- SUP 1: 0.6859 Low Jul 21
- SUP 2: 0.6786/6682 Low Jul 18 / 14 and the bear trigger
- SUP 3: 0.6647 0.764 proj of the Apr 5 - May 12 - Jun 3 price swing
- SUP 4: 0.6588 Low May 28 2020
AUDUSD is unchanged and consolidating closer to its recent highs. The short-term outlook is bullish and a corrective cycle remains in play. A resumption of gains would open the Jun 16 high at 0.7069, and potentially 0.7141 further out, the 76.4% retracement of the Jun 3 - Jul 14 downleg. Any reversal lower would instead refocus attention on the 0.6682 bear trigger, Jul 14 low, where a break would confirm a resumption of the broader downtrend.
US: Corporate Credit Update: Near Six Week Lows
Well off early session highs, investment-grade corporate credit risk drifts near last week's six week lows as stocks hold decent gains on modest trade in lead up to FOMC policy annc. Currently, SPX eminis trade +49.75 (1.27%) at 3972.75; DJIA +64 (0.2%) at 31823.78; Nasdaq +288 (2.5%) at 11850.11.
- Investment grade risk measured by Markit's CDXIG5 index -2.638 to 84.597; CDXHY5 high yield index at 100.202 (+0.553).
- Outperforming credit sectors (tighter or least wide): Communications (-2.8), Industrials and Technology both -2.7.
- Lagging sectors (wider or least narrow): Financials (subordinated) -0.9%, Materials (-1.3), followed by Senior Financials (-1.5).
