Copper prices are heading for their worst week since November, as the metal fell to its lowest level since June 30. Copper is down 4.1% for the week, following a 7.2% drop during its worst week in November. Additionally, the S&P Metals & Mining ETF is down about 1.7% for the week, marking its second straight weekly loss. Companies such as Coeur Mining, Hecla Mining, Piedmont Lithium, and Compass Minerals are all down more than 10% this week.
Meanwhile, the producer price index (PPI) rose more than expected in July. The PPI, which measures how much wholesalers pay for raw goods, increased by 0.3%, surpassing economists’ expectations of a 0.2% increase.
In the stock market, UBS saw its stock rise 4.6% in premarket trading after ending a loss protection agreement and liquidity backstop with Credit Suisse. Six Flags, on the other hand, slipped 2.5% after missing second-quarter estimates. Maxeon Solar Technologies also tumbled 26% due to weakening demand. The clean energy company reported second-quarter revenue of $348.4 million, falling short of its guidance range.
Looking at the overall market performance, the Dow is the only index on track for gains this week, up 0.3%. The Nasdaq Composite and S&P 500, however, have both experienced losses of 1.2% and 0.2%, respectively. This marks the second consecutive week of losses for both indexes.
UBS Global Wealth Management suggests that the recent consumer price index (CPI) report indicates a slowdown in price pressures, potentially allowing the Federal Reserve to end its rate hiking campaign. However, UBS notes that while this may support equity market sentiment, optimistic economic outlooks are already priced into stocks.
In European markets, stocks opened lower as investors continue to analyze earnings and U.S. inflation data. The pan-European Stoxx 600 index was down 0.5% in early trading, with mining stocks leading losses.
In Singapore, the Straits Times Index fell 1.22% after the country’s trade and industry ministry narrowed its gross domestic product outlook for 2023. The full-year forecast was reduced to a range of 0.5% to 1.5%, down from the previous range of 0.5% to 2.5%. Financial and technology stocks were the main contributors to the index’s losses.
Chinese real estate company Country Garden Holdings experienced a record low in its shares after issuing a profit warning. The company expects to record a net loss of about 45 billion to 55 billion yuan for the first half of the year, compared to a profit of 1.91 billion yuan during the same period last year. The decline in the gross profit margin of its real estate business and an increase in impairment of property projects due to declining sales were cited as the main reasons for the profit warning.
On a more positive note, Alibaba’s Hong Kong listed shares surged over 3% after the company reported a 51% increase in attributable profit and a 14% rise in revenue for the second quarter. This marks its biggest annual increase in sales since the September 2021 quarter.
Lastly, the FANG+ stocks, which include major technology stocks, are on track to end the week in the red, with the First Trust Dow Jones Internet Index Fund down 1.21% for the week.
Overall, stock futures opened little-changed, indicating a cautious start to the trading day.