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Daily Market Review – 16 July 2015

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Daily Market Review – 16 July 2015

Jul 16 2015, 09.15am GMT



Ready, Steady, Netflix Split


STOCK.com   Stocks

On Wednesday, in pre-market trade, the Netflix Inc. (NFLX, -2.72%) 7-for-1 split took place. This opened the doors for many traders as Netflix stocks have now become affordable and can be purchased for approximately $100 compared to the $700 a share only a day prior. To put it into perspective, on Tuesday, the online video-streaming giant's stock traded at $702.60 a share. This marked them as the 2nd highest priced stock among the components on the S&P 500 index (SPX). As a result of the 7-for-1 split, the new Netflix stock price has pushed the company into the 119th highest priced at the split-adjusted closing price of $100.37. It is important to note that the Netflix stock split will not change anything for the company in terms of the fundamentals. Instead, we will see an increase in the number of shares outstanding yet the doors have also been opened to make it easier for investors to now purchase a typical number of shares which in turn, could increase the trading volume. In premarket trade, Netflix shares traded at $100.63, up 0.3% and these shares have more than doubled since the beginning of 2015, split adjusted. In comparison, the S&P 500 index has increased by 2.4 percent over the same period. So what are you waiting for, have you bought your Netflix shares yet?

STOCK.com   Indices

On Wednesday, U.S. stocks declined into the red after maintaining within a narrow range of gains for most of the trading session. This came in response to reports of violent protests in Greece while investors also shifted their attention to the semi-annual testimony by Janet Yellen, the Chairwoman of the Federal Reserve. Interestingly, Yellen reiterated that she expects the central bank to raise the interest rates ‘at some point this year’. At the close of trading, the S&P 500 index (SPX) declined 0.2%, or 4 points, to 2,105 while the Dow Jones Industrial Average (DJIA) dropped 0.1%, or 20 points, to 18,034. Also on the downside was the Nasdaq Composite index (COMP) which declined 0.2%, or 11 points, to 5,095. Before the decline of the main indices, the SPX and the DJIA looked as if they were going to post their 5th straight day of advances while the tech heavy Nasdaq was also headed for its 4th straight day of gains.

STOCK.com   Currencies.

On Wednesday, the U.S. dollar (USD) traded broadly higher. This came in response to testimony by Federal Reserve Chair Janet Yellen that the central bank is on track to raise interest rates ‘before year end’. Added to this, Yellen also stated that the economic weakness in China as well as the debt crisis in Greece, both pose as potential risks to growth in the U.S. Meanwhile, data showed that the Empire State Manufacturing Index rose in July to 3.86 from minus 1.98 in June. This missed expectations for a reading of 3.00. In a separate report, data showed that the producer prices in the U.S. increased in June by 0.4 percent. This beat expectation for a gain of 0.2%. The EUR/USD traded at 1.0978, down 0.30% while the GBP/USD traded at 1.5613, down 0.15%. Against the currencies in Canada, Japan and Switzerland, the greenback traded higher with USD/CAD up 0.33% at 1.2770, with USD/JPY up 0.34% at 123.81 and with USD/CHF up 0.52 percent to trade at 0.9495. Also, the U.S. dollar index was at 97.08, up 0.28%.

STOCK.com   Commodities

On Thursday, crude oil prices rebounded in Asian trading. This came after a sharp overnight decline which prompted investors to buy. Meanwhile, in its weekly report, the EIA (U.S. Energy Information Administration) stated that for the week ending on the 10th of July, crude inventories declined by 4.3 million barrels which beat analyst expectations for a draw of 1.2 million barrels for the week. U.S. crude stockpiles are currently at their highest level in at least 80 years at 461.4 million. Also, on Tuesday, Brent crude oil for delivery in September traded at $57.03, down 2.79%, or $1.64, on the Intercontinental Exchange (ICE) in London.

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