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Jun 29

Brexit ease rebound Global equities including U.S. Stocks

Market Recap:

Global equities, including U.S. stocks rebounded on Tuesday as market participants’ fears relating to BREXIT eased. Energy, Financials and Consumer Discretionary shares fared best, as JP Morgan, Travelers and Visa led the Dow Jones Industrial Average nearly 270 points higher. The Euro and the British Pound rebounded slightly against the dollar, while Treasuries sold off slightly with the 10 Year yield closing at 1.46%; oil also gained.

 

Looking Ahead:

International bourses are helping lift U.S. equity futures in pre-market trading on Wednesday morning, as the initial over-reaction to Briton’s vote to exit the European Union calmed. In spite of the positive market moves yesterday and possibly today, which we certainly welcome, we urge investors to be cautious and not allow short-term volatility or emotions to drive their investment decisions. Quarter-end ‘window dressing’ (a term used to describe end of quarter trading by mutual fund managers to sell some losers and replace them with recent winners to make their portfolios look better) is likely as we approach the Independence Day holiday. Thereafter markets will likely refocus their attention on economic news as well as corporate earnings news. To that end, Nike reported earnings on Tuesday afternoon, beating EPS forecasts but disappointing on the sales and revenue front. Next week’s release of FOMC meeting minutes and Chinese economic data will be critically watched.