The news shaping the markets today

As many as 80,000 Russians have been killed or injured in Ukraine since the beginning of the war in late February, a senior Pentagon official said. Despite the continued tensions, the safe-haven US dollar traded slightly lower this morning.

Australia’s NAB business confidence index rose 5 points from June to a reading of 7 in July, lending support to the AUD/USD forex pair.

The Philippines reported that its economy contracted by 0.1% in the second quarter, missing the consensus expectations of 0.5% growth. The news sent the PHP/USD pair lower in forex trading this morning.

UK’s retail sales grew 1.6% year-on-year ago in July. This being the first time the UK reported retail growth in five months lent support to the GBP/USD forex pair.

New Zealand’s electronic card transactions fell by 0.5% year-over-year to NZ$6,221 in July, following a 2.9% growth in the previous month. The latest reading signalled the first decline since October 2021 and sent the NZD/USD pair lower in forex trading this morning.

What’s happening: Shares of BioNTech SE tumbled on Monday, after the company posted weaker-than-expected earnings for its second quarter.

What happened: BioNTech’s quarterly results were impacted by an agreement to delay deliveries of its covid-19 vaccine to the European Union.

Despite the disappointing quarterly results, the German pharma company reiterated its guidance for the full year.

How were the results: The Mainz-based company reported a decline in sales for its second quarter, with both top-and bottom-line metrics missing market views.

• Revenue declined to €3.19 billion, from €5.3 billion in the year-earlier quarter and from €6.37 billion in the previous quarter. The figure also missed the consensus estimate of €4.01 billion.
• Earnings came in at €6.45 per share, falling short of market expectations of €7.21 per share.

Why it matters: BioNTech had partnered with Pfizer to develop its covid-19 vaccine. Demand for this vaccine has recently been easing, with most people in the Western region has already taken three or four doses.

Owing to the decline in demand, BioNTech and Pfizer agreed to delay supplies of their covid-19 vaccine to the EU. Shots that were due for delivery from June through August will now be shipped from September through December.

BioNTech and Pfizer are set to begin clinical trials of a covid-19 vaccine targeting the BA.4 and BA.5 subvariants this month, projecting initial doses to be shipped as early as October, provided it receives regulatory approval.

BioNTech and Pfizer signed an agreement with the US government to supply another 105 million vaccine doses, with the option of an additional 195 million doses.

Despite the disappointing results for the second quarter, BioNTech reaffirmed its covid-19 vaccine revenue projection of €13-€17 billion for 2022, compared to €19 billion in the previous year.

How shares responded: BioNTech’s shares fell 7.5% to close at $169.30 on Monday, following the release of quarterly results. The stock has lost around 27% year to date.

What to watch: Markets will keep an eye on the spread of covid-19 variants as well as developments around the company’s trials adapted to the BA.4 and BA.5 subvariants.

The markets today

Crude oil will be in focus today ahead of the API’s (American Petroleum Institute) data on crude oil stockpiles

Context: Oil prices settled higher on Monday, following positive economic reports from the US and China.

Details: Concerns around a slowdown in the global economy have been exerting pressure on oil prices, sending Brent prices to their weakest level since February. Last week, the global benchmark crude recorded its steepest weekly decline since April 2020, with WTI crude prices also falling by around 9.7%.

Both oil contracts recovered some losses on Friday, following better-than-expected jobs data from the US, the world’s biggest oil consumer. The US reported an increase in nonfarm payrolls of 528,000 in July, the most significant growth since February, which easily topped estimates of 250,000 job adds.

China, the world’s biggest crude importer, also reported stronger-than-expected export growth over the weekend, lending support to oil prices. China imported 8.79 million bpd (barrels per day) of crude during July. Although this is 9.5% lower than the year-ago period, it was higher than the previous month’s four-year low.

Exports from China unexpectedly surged by 18% year-over-year to a seven-month high of $332.96 billion in July, while imports rose 2.3%, taking the trade surplus to a record high of $101.26 billion.

WTI crude for September delivery surged $1.75, or 2%, to settle at $90.76 per barrel on the NYMEX on Monday. October Brent crude climbed $1.73, or 1.8%, to close at $96.65 per barrel on ICE Futures Europe.

In another energy trading, September gasoline added 1.1% to reach $2.8862 a gallon, while September heating oil fell 1.1% to $3.1791 a gallon.

Prices for natural gas declined amid the forecast of cooler-than-normal temperatures in the near term. September natural gas settled at $7.589 per million British thermal units, down 5.9%.

What to watch: Traders await the release of API’s data on crude oil stockpiles today, which had climbed by 2.165 million barrels in the week ended July 29, after a decline of 4.037 million barrels in the prior week. Markets will also keep an eye on the EIA’s (Energy Information Administration) data on crude oil inventories, due for release on Wednesday.

Other Markets: European trading indices closed higher on Monday, with the FTSE 100, DAX 40, CAC 40 and STOXX Europe 600 up by 0.57%, 0.84%, 0.80% and 0.74%, respectively.

Support & resistances for today

Market snapshot

What else to watch today

Japan’s machine tool orders, US NFIB small business optimism index, unit labour costs, nonfarm labour productivity, Redbook index and IBD/TIPP economic optimism index, Brazil’s inflation rate and Central Bank of Brazil’s focus market readout, Mexico’s consumer price index, as well as Argentina’s industrial production.

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