Ethereum Outperforms as Bitcoin Stays Stuck Below $120,000 — Market Talk

1037 ET - Cryptocurrency ethereum outperforms its better-known peer bitcoin, rising to a six-month high of $3,478.97, LSEG data show. Bitcoin shows signs of consolidating lower after hitting a record high of $123,153 on Monday, says David Morrison at fintech provider Trade Nation. Traders looking to benefit from further bitcoin gains are frustrated by bitcoin's failure to rise back above $120,000, he says in a note. This has "raised questions about whether momentum can sustain without a fresh catalyst." Meanwhile, Ethereum has led gains among major crypto assets, Morrison says. Bitcoin is last down 1.3% at $118,409, LSEG data show. (jessica.fleetham@wsj.com)

1023 ET - Treasury yields decline as markets look deeper into today's data. A decline in jobless claims and higher-than-expected retail sales initially boosted yields, as the data pointed to a resilient economy and supported bets on a hawkish Fed. But claims were affected by lower-than-usual summer auto plant shutdowns, Pantheon's Samuel Toms writes. He expects unemployment to trend higher. Another Pantheon economist, Oliver Allen, writes that retail sales growth wasn't so impressive under the hood and weakness lies ahead. The 10-year yield is at 4.436% and the two-year at 3.896%, both lower than before the date release. (paulo.trevisani@wsj.com; @ptrevisani)

1005 ET - The European Central Bank is unlikely to protest much about the recent strength of the euro, Morgan Stanley strategists say in a note. Comments from ECB policymakers at a recent conference in Sintra, Portugal, have "led investors to overestimate the amount of ECB pushback to euro strength we'll see," they say. The euro is currently experiencing a short-term tactical correction lower toward $1.15, but Morgan Stanley expects it to rebound further. The euro falls to a three-week low of $1.1555 on Thursday, LSEG data show, as the dollar strengthens after better-than-forecast U.S. jobless claims and retail sales data. The euro hit a near four-year high of $1.1829 on July 1. (jessica.fleetham@wsj.com)

0925 ET - Investors are likely to continue moving funds out of U.S. assets, contributing to the dollar weakening in the long term, Validus Risk Management's Marc Cogliatti says in a note. U.S. policy uncertainty is likely to prompt investors to diversify from the country, he says. The dollar could strengthen near term, supported by demand for safe-haven assets due to waning risk appetite, but the broader selling trend will remain, Cogliatti says. "Foreign investors are still diversifying out of the U.S.; a near‑term bounce won't derail the broader down‑trend." The DXY dollar index is last up 0.3% at 98.675, having hit a three-week high of 98.950 after better-than-forecast U.S. jobless claims and retail sales data. (miriam.mukuru@wsj.com)

0904 ET - Gold prices extend losses in afternoon trade, pressured by a firmer U.S. dollar and President Trump denying he had plans to oust Fed Chair Jerome Powell. Futures fall 1.2% to $3,318.40 a troy ounce, while the U.S. dollar index is up 0.3% to 98.70. Trump said it was "highly unlikely" he would replace Powell, easing market concerns about potential interference in the U.S. central bank's independence. Meanwhile, "a slightly softer-than-expected June core inflation reading keeps alive the chances of a September Federal Reserve interest-rate cut, but the risk is that we get less benign prints for July and August," says ING's James Knightley. "That means we will need to see clear evidence of softer jobs figures to trigger Fed action before December."(giulia.petroni@wsj.com)

0903 ET - Credit rating agency S&P could lower the U.K.'s rating outlook to negative, or even downgrade the country's rating, at its October rating decision, Nomura research analysts say in a note. The S&P rating for U.K. is AA, one notch above that of Fitch and Moody's at AA- and Aa3 respectively. Following the U.K. government's reversal of its plans for welfare spending cuts in June, S&P analysts noted the U.K.s limited fiscal headroom in an analysis. The comments "raise the prospect of S&P either moving the U.K.'s outlook to negative or downgrading the U.K. to the same rating level as Fitch and Moody's," Nomura analysts say. (miriam.mukuru@wsj.com)

0854 ET - U.S. indicators keep giving the Fed reasons to remain on hold and Treasury yields and the dollar rise. Weekly jobless claims fall to 221,000 from an upwardly revised 228,000, in a sign employers are holding on to their workers. Economists surveyed by WSJ expected 234,000. June retail sales rise 0.6%, after declining 0.9% in May. The WSJ consensus was a 0.2% uptick. The 10-year is at 4.473% and the two-year at 3.921%. The WSJ Dollar Index rises 0.5%. (paulo.trevisani@wsj.com; @ptrevisani)

0803 ET - Hong Kong is becoming a more important global hub for raising money through stock markets, according to the latest IPO Trends report from EY. This is mainly because more companies from mainland China are choosing to do secondary listings there, EY notes. In the second quarter, Hong Kong reclaimed its spot as the world's top IPO exchange by proceeds for the first time in six years, EY says. The recent positive changes in China's IPO market are expected to attract more international investors going forward and help the market grow in a sustainable way, EY adds.(maitane.sardon@wsj.com)

0733 ET - The U.K. labor market data released on Thursday shows weakness, a factor likely to inspire confidence in the Bank of England to cut interest rates in August, Barclays' Jack Meaning says in a note. The U.K. unemployment rate increased to 4.7% in the three months to May, from 4.6% in the three months to April. Average wage growth excluding bonuses decelerated to 5.0% in the three months to May from 5.3% in the three months to April. "[Thursday's] data should reassure the monetary policy committee that the labor market is loosening and on course to deliver the wage growth deceleration the MPC is looking for," Meaning says. (miriam.mukuru@wsj.com)

0728 ET - A gauge measuring optimism among Canadian small- and mid-sized businesses hit a six-month high in July, signaling most owners expect stronger sales in the next 12 months. The Canadian Federation of Independent Business's confidence index climbed to 50.9 in July. This represents a sharp recovery after the index hit a record low of 25.5 in March, due to elevated uncertainty around tariffs. The index reports that firms expect to raise their prices by 2.7% over the next year, or slower than the previous month's 2.9%. For the fourth time in five months, the share of small firms looking to reduce payrolls exceeded those businesses looking to hire. All told, the report indicates smaller firms believe the worst may be behind them in terms of tariff-fueled uncertainty. (Paul.Vieira@wsj.com; @paulvieira)

0655 ET - Despite the European IPO market slowing in the first half, stronger activity is expected after the summer break, according to the latest IPO Trends report from EY. Interest rate cuts and the EU's efforts to diversify its trade and investment relationships are encouraging signs, EY says. Additionally, a weakened U.S. dollar and prolonged U.S. policy uncertainty are redirecting capital to Europe, adding further momentum to the region, EY says.(maitane.sardon@wsj.com)

0649 ET - Sarepta's strategic review and planned reduction of 36% of its workforce are likely necessary for the company to keep up with debt and rising sales concerns, Cantor analysts Kristen Kluska and Richard Miller say. The biopharmaceutical company is still on the hook for $1.15 billion in convertible notes by 2027, making the expected $400 million in cost savings an important boost. The analysts also expect Sarepta's Elevidys product to hit some rocky demand after two patient deaths. Sarepta did get FDA approval for a black box label on the product, but the analysts still have "deep concerns about the safety of the treatment." Shares jump 34% in pre-market trading. (katherine.hamilton@wsj.com)