Macro Roundup (Sep 11)

SHANGHAI, Sep 11 (SMM) — This is a roundup of global macroeconomic news last night and what is expected today.

Oil prices eased on Thursday after US data showed a surprise build in crude stockpiles last week, confirming an industry report.

The US Energy Information Administration (EIA) said crude inventories rose 2.0 million barrels last week, and the American Petroleum Institute (API) on Wednesday reported a 3 million-barrel increase.

“The market was a little surprised by the build given that much of the Gulf of Mexico production had not returned but this was offset as refineries ... have struggled to return after Hurricane Laura,” said Andrew Lipow, president of Lipow Oil Associates in Houston, noting “The decline in gasoline and distillate demand was another disappointment.”

Gold jumped 1% on Thursday, as the dollar weakened after the European Central Bank kept its policy unchanged and US jobless claims held at high levels, dimming hopes of a quick economic recovery from the effects of the coronavirus pandemic.

Economic data on Thursday showed weekly US jobless claims were worse-than-expected last week. The Labor Department reported 884,000 first-time filings for unemployment insurance in the week of Aug. 30 to Sept. 5, compared with 850,000 expected by economists surveyed by Dow Jones. Continuing jobless claims, or the number of people already receiving benefits, rose by 93,000 to a seasonally adjusted 13.39 million in the seven days ended Aug. 29. It was the first increase in five weeks.

The European Central Bank (ECB) decided Thursday to keep its interest rates and coronavirus-stimulus program unchanged. The interest rate on the ECB’s main refinancing operations, marginal lending facility and deposit facility remain at 0.00%, 0.25% and -0.50%, respectively. While the bank’s Pandemic Emergency Purchase Programme remains at a total of 1.35 trillion euros ($1.6 trillion).

On Wall Street, the Dow Jones Industrial Average ended the regular session down more than 1% along with the S&P 500. The Nasdaq Composite dropped 2%. All three of the major indexes had popped before closing lower.

That whipsaw action came as tech — the best-performing market sector year to date — continued its recent downward trend. Facebook, Amazon, Apple, Netflix, Alphabet and Microsoft all closed sharply lower on Thursday. Tesla, which was up more than 8% at one point, posted a gain of just 1.4%.

On the LME, nonferrous metals finished in negative territory on Thursday. Copper fell 1.86% to lead the losses, zinc slid 1.22%, lead declined 1.08%, nickel weakened 0.67%, tin shed 0.47% and aluminium slipped 0.31%.

Shanghai base metals, except for aluminium, closed lower in overnight trading. Copper fell 1.33%, zinc shed 0.62%, lead declined 1.91%, nickel weakened 0.54% and tin slid 0.97%, while aluminium rose 0.73%.

On the data front, the latest reading on the US consumer price index (CPI), German CPI for August and China’s social financing for August are set for release today.