Pre-Market Report – Friday 2 August: US Markets Tumble - Volatility Returns - SPI down 144 - Apple Reports

Market Updates

US equities kicked off August sharply lower as the market whipsawed to risk-off just a day after the S&P 500 and NASDAQ recorded their best daily performance since February on Wednesday. The Dow ended 495 points lower (-1.21%). Up 254 points at best. Down 744 points at worst. The S&P 500 lost 1.37%, just one day after rallying 1.6%, and the tech-heavy NASDAQ dropped 2.30%. Russell 2000 slumped 3.03%, its biggest daily loss since February, and Wall Street's fear index, the VIX, briefly traded above 19 before easing to 18.59 (+13.63%). Economic data overnight has spurred concerns that the US economy is slowing faster than expected. Early gains in the market evaporated after the US ISM Manufacturing PMI showed a larger-than-expected contraction, falling to 46.6 in July, its 20th decline in activity over the last 21 months. Cracks in the labour market also began to emerge, with Initial Jobless claims rising to an 11-month high, climbing 14k to 249k, exceeding expectations of 236k. Treasury yields tumbled on soft economic data, the 10Y and 2Y yields have fallen to six-month lows, with the 10Y yield now under 4%. USD edged higher as rising geopolitical concerns in the Middle East drove a safe haven boost, while the British pound fell after the BoE cut interest rates from a 16-year high.

ASX set to tumble. SPI Futures down 144 points (-1.78%)
COMMODITIES

• Copper falls on soft Chinese factory data, higher inventories.
• Gold withdraws from two-week high as focus shifts to US payrolls data.
• Oil slips over $1 as supply intact despite Middle East conflict fear.
• Iron ore rises to more than 1-week high on upbeat demand outlook, China stimulus hopes.
• Shell beats forecasts with $6.3bn second quarter profit.
• Japan's Nippon Steel raises FY profit forecast after Q1 beat.
• OPEC+ sticks to oil policy, repeats could pause Oct hike.

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