Quarterly Results and Retail Sales beat expectations, the Dow Jones rose more than 2%. Up to 80% of the 35 companies in the S&P 500 that have reported Quarterly Results, performed above market expectations. The release of economic data also was surprising, with Retail Sales Advance MoM 1.0% (Surv. 0.9%); as consumers spend more USD on gasoline and other goods costs in June. Meanwhile, inflation expectations for the next year will be lower, with the U. of Mich. 1Y Inflation at 5.2% (Surv. 5.3%). Meanwhile, Industrial Production MoM fell 0.2%, or decreased for the second month in a row. Currently, economic indicators are inconsistent, suggesting that the US is in transition.
Energy leads sectoral decline amid tug-of-war on the implementation of the carbon tax. Over the weekend, the energy sector fell by 2.9%; followed by the industrial sector, which fell 1.4%, causing the JCI to weaken 0.6% to 6,651 points. The Minister of Finance ensures that the implementation of the carbon tax will still be carried out this year, after being postponed twice in July 2022 and April 2022. Meanwhile, foreign top sells happened to the Big Four Banks, ahead of the Quarterly Results at the end of July. Meanwhile, the lack of sentiment at the beginning of the week has the opportunity to make JCI follow Wall Street’s strengthening last weekend. NHKSI Research projects that the JCI will move upward in the range of 6,600-6,800.
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