The Day at a Glance | July 15 2024

The Top

• China’s economy slowed in the second quarter.

• Donald Trump consolidates his control over theRepublican Party in the 2024 convention this week, after surviving an assassination attempt and navigating numerous legal entanglements on his way to the party’s presidential nomination.

• Federal Reserve Chairman Jerome Powell begins what is shaping up to be a key week of comments from US central bank officials on Monday, as they assess the slowdown in inflation and consider the start of interest rate cuts. 

• France’s public finances and its growing deficit are concerning and leave the country “dangerously exposed” in the event of a new macroeconomic shock, the national public audit office said on Monday.

• Oil held firm on Monday as downward pressure from concerns about demand in China, the largest importer, countered support from strong demand elsewhere, OPEC+ supply constraints, and geopolitical tensions in the Middle East.

• Main US indices are up at the start of the week.

Economic Environment

China’s economy slowed in the second quarter. In the second quarter, the world’s second-largest economy grew by 4.7% year-on-year, below the 5.3% year-on-year recorded in the first quarter and the 5.0% consensus forecast. By sector, agriculture grew by 3.5% year-on-year (3.8% previous), industrial production by 5.8% year-on-year (6.1% previous), and services by 4.6% year-on-year (5.0% previous). Gross fixed investment grew by 3.9% in the first half of the year (4.0% previous), slightly higher than the consensus estimate (3.8%). Regarding the labor market, the urban unemployment rate stood at 5.0% in June, remaining unchanged and in line with market expectations. On the other hand, economic indicators for June logged a significant slowdown with retail sales increasing 2.0% year-on-year (3.7% previous) and industrial production rising 5.3% (5.6% previous). Overall, China’s economy grew much more slowly than expected in the second quarter, as a prolonged real estate crisis and the lack of job security weakened a fragile recovery, keeping expectations alive that Beijing will need to implement even further stimulus.

Markets and Companies

Main indices in the US are up at the start of the week. Main US indices are up on Monday as investors evaluated the impact of the assassination attempt on former President Donald Trump and prepare for a week of corporate reports. In Europe, markets are down. The Stoxx 600 fell by -0.64% at 2:00 p.m. London time, and most sectors were trading in the red. Mining stocks led the losses, falling by -1.68%, followed by utility stocks, which lost -1.58%. In Asia, markets mostly fell. China’s GDP data did not meet expectations, while investors also assessed the impact of the assassination attempt on Trump. Regarding commodities, oil extends its losses while the dollar strengthens after the attack on Trump. At the same time, US bond futures fell as investors bet that the attack on Trump makes his victory in the upcoming presidential election more likely. Metals are down, and cryptocurrencies are mostly up. Lastly, in Mexico, the IPC is up +0.07% and stands at 54,991 points. 

Over the weekend, the exchange rate fluctuated between a low of 17.62 and a high of 17.84, currently trading at 17.84.

Corporate News

• Trump Media & Technology shares, the parent company of Truth Social, rose more than 50% following the assassination attempt on former President Trump on Saturday. Some have argued that the attempt could increase the odds of a Trump victory in the November elections.

• Apple shares rose 2% after a pair of price target increases from Wall Street analysts.