Early Morning Call: Equity markets start H2 in positive territory
Apple closed Friday's session with a $3 trillion market capitalization for the first time. But can it remain at this level in today's session?
Japan overview
In Japan, business sentiment improved in the second quarter. The Bank of Japan (BOJ) Tankan large manufacturers index rose 5 in June, bouncing back from the two-year low of 1 recorded three months ago. This latest data confirms economists' opinion that the world's third-largest economy is on track for a moderate recovery.
China overview
In China, factory activity in the private sector managed to keep its head above water in June. The Caixin Manufacturing purchasing managers' index (PMI) fell to 50.5 in June 2023 from 50.9 in the prior month but was above the market consensus of 50.2. Crucially, the index remains above 50. A print below 50, like the official NBS PMI last week, suggests the sector is in contraction territory.
US markets
Over in the US, the market awaits the institute for supply management (ISM) manufacturing's purchasing managers' index (PMI) for June. The index is forecast to be 47, up from 46.9 in May. This would be the eighth month of contraction for the manufacturing sector in the country.
Tesla
Tesla reported on Sunday a record number of vehicles delivered in the second quarter. Tesla delivered 466,140 vehicles in the April–June period, up 10% on the previous quarter and 83% higher than a year earlier. Since the start of 2023, Tesla has taken the risk of cutting its prices to make its cars more competitive, especially on the Chinese market, its second-largest market after North America.
Apple
Another stock to keep an eye on at 9 a.m. at the opening of the IG all-session market is Apple. The stock closed Friday's session with a $3 trillion market capitalization for the first time. But can it remain at this level in today's session? The Financial Times reports that Apple has been forced to make major cuts to production forecasts for its Vision Pro headset. According to the newspaper, the complexity of the design of the mixed-reality device makes its production more difficult than anticipated.
US banks
After the release of the Federal Reserve (Fed) stress test results a few days ago, US banks have announced their dividend and share buyback plans. Goldman Sachs raises its quarterly dividend to $2.75 from $2.50. JPMorgan, Citigroup, Wells Fargo & Co and Morgan Stanley also raise their dividends; the latter also renews its $20 billion share buyback programme.
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