Top 5 Things To Know In The Market On Wednesday

Aug 08, 2018

Here are the top five things you need to know in financial markets on Wednesday, August 8:

1. Chinese Exports Accelerate Even As Trump Escalates Trade War

China's exports surged more than expected in July despite U.S. tariffs, while its closely watched surplus with the United States remained near record highs, as the world's two major economic powers ramped up a bitter dispute that some fear could derail global growth.

The data provided the first readings of the overall trade picture for the world's second-largest economy since U.S duties on $34 billion of Chinese imports came into effect on July 6.

China's July exports rose 12.2% from a year earlier, beating forecasts for a 10% increase, and up from a 11.2% gain in June.

Imports also rose much faster in July, jumping 27.3%, thanks to still solid domestic demand.

Of more direct consequence in the Sino-U.S. trade war, China's surplus with the U.S. shrank only marginally to $28.09 billion last month from a record $28.97 billion in June.

In the latest move by President Donald Trump to put pressure on Beijing to negotiate trade concessions, Washington is set to begin collecting 25% tariffs on another $16 billion in Chinese goods on August 23.

2. U.S. Stock Futures Point To Flat Open

U.S. stock futures pointed to a muted open, as trade concerns continued to linger and investors focused on the latest batch of corporate earnings.

At 5:30AM ET, the blue-chip Dow futures were up just 4 points, or less than 0.1%. The S&P 500 futures and tech-heavy NASDAQ 100 futures also indicated a flat start to their respective trading sessions.

Stocks rose on Tuesday, as the S&P 500 moved closer to a record high set earlier this year, boosted by strong corporate earnings.

Elsewhere, in Europe, the region's major bourses were mostly lower in mid-morning trade, with most sectors in the red, as corporate earnings failed to lift sentiment.

Earlier, in Asia, stocks in the region closed mixed, with China losing steam after rebounding in the last session, as investors reacted to the latest salvo in the U.S.-China trade dispute.

3. Last Major Wave Of U.S. Earnings

Dozens of companies are expected to release earnings today in one of the last big waves of the earnings season.

Ahead of the opening bell, results are due from CVS Health (NYSE:CVS), Michael Kors (NYSE:KORS), Keurig Dr Pepper (NYSE:KDP), Liberty Media (NASDAQ:FWONA), Mylan (NASDAQ:MYL), New York Times (NYSE:NYT), Thomson Reuters (NYSE:TRI), Lumentum (NASDAQ:LITE), Autohome (NYSE:ATHM), Weibo (NASDAQ:WB), and SINA (NASDAQ:SINA).

Roku (NASDAQ:ROKU), Booking Holdings (NASDAQ:BKNG), 21st Century Fox (NASDAQ:FOX), Yelp (NYSE:YELP), Monster Beverage (NASDAQ:MNST), TiVo (NASDAQ:TIVO), Sarepta Therapeutics (NASDAQ:SRPT), and Nektar Therapeutics (NASDAQ:NKTR) report after the market close.

Other stocks that will likely be in focus today include, Tesla (NASDAQ:TSLA), which soared 11% on Wednesday after Chief Executive Elon Musk said he was considering taking the electric car maker private.

Snap (NYSE:SNAP), Disney (NYSE:DIS) and Papa John's (NASDAQ:PZZA) will also capture some attention, with all three set for a volatile session in the wake of earnings updates released after Tuesday's closing bell.

4. Oil Markets Await Fresh Weekly U.S. Inventory Data

The U.S. Energy Information Administration (EIA) will release its official weekly oil supplies report for the week ended August 3 at 10:30AM ET, amid forecasts for an oil-stock drop of 3.3 million barrels.

The data will also offer fresh indications on domestic output levels.

After markets closed Tuesday, the American Petroleum Institute said that U.S. oil inventories declined by 6 million barrels last week.

Oil prices were little changed ahead of the data, with U.S. WTI crude futures at $69.17 per barrel, while London-traded Brent crude futures were at $74.61 per barrel.

5. Cryptos Collapse On Delayed ETF Decision

Cryptocurrencies plunged, with Bitcoin tumbling below $6,500 for the first time since July, after the U.S. Securities and Exchange Commission postponed a decision on whether to allow the listing of an exchange-traded fund backed by the largest digital currency.

The SEC now has until September 30 to “approve or disapprove, or institute proceedings to determine whether to disapprove” a proposed rule change from Cboe Global Markets Inc. that would allow the listing of a fund from VanEck Associates Corp. and SolidX Partners Inc. to list, the regulator said in a statement.

An initial deadline was due to expire next week.

Bitcoin was last down around 8%, or $560, at $6,478.70 on the Bitfinex exchange, a level last seen on July 16.

Rival tokens also fell.

Ethereum, the world’s second largest cryptocurrency by market cap, was down almost 11% at $367.70, its worst level since April 6.

Meanwhile, Ripple's XRP token was trading at $0.34699, down 15% for the day, while Litecoin was down 12.5% at $65.21.