Today will be all about whether equity markets can sustain the positive momentum after the best August in years and yesterday’s Apple and Tesla stock splits.
Also - Zoom reported earnings after the bell Monday, today there is an RBA rate decision and the final readings for August manufacturing PMIs released from across the globe.
The S&P 500 just had its best August return since 1984, which is some strong momentum going into September when most investors will be back at their desks after a summer break.
There has been a great furore, especially among seasoned investors about the reaction in stock markets to the Apple and Tesla stock splits. Both companies saw shares close in positive territory yesterday after a 5:1 and 4:1 split respectively seemed to encourage new entrants into a very well established uptrend.
Zoom earnings smashed lofty expectations with the video conferencing company reporting quadruple the revenue of the same period last year with an EPS of 92c versus the 45c expected. The results are thanks to the surge in demand for technology that facilitates remote working and meetings during the coronavirus pandemic. Zoom shares are set up to open +18% higher on Tuesday.
The RBA is widely expected to keep interest rates on hold at today’s meeting but we can probably expect a more cautious tone given the ongoing lockdown in Melbourne and rising tensions with Australia’s main trading partner, China. Last time around the RBA resumed its bond purchases and may pledge to do so again at this meeting but given the clam in markets there will be no rush to do so. AUD/USD just touched a 2-year high at 0.74 so it will be interesting to see if this gets a mention.
The video edition of the Day Ahead returns tomorrow!
Thanks for tuning in!