Senior Relationship Manager
Summary: A possibly quiet day
Good Morning,
Despite a lower than feared PPI yesterday, San Francisco Federal Reserve Bank President Mary Daly appeared on Bloomberg with rather hawkish tones. She said she preferred a 50 BPS Hike in September but thar she was open to a 75 bps hike should date require it.
Equities gave up some ground on that note but not significantly. The Dow gained 0.08%, the S&P fell by 0.07% and the Nasdaq fell by 0.6%. maybe most interesting was that the S&P 500 failed to close above the 50 retracement line if the January / June decline.
The GER 40 is trading at 13700 and looking for inspiration.
EURUSD tested the 1.0350 resistance yesterday but failed to break higher and retreated to 1.0320, GBPUSD is meandering around the 1.22 and USDJPY 133.25. The USD Index is trading at 105.15 and there is some technical support at 105.00.
US Yields rose to 2.87 for the 10 year and we remain strongly inverted with the 2 year at 3.21.
Gold and Silver gave up ground yesterday but could recover a little to now trade at 20.38 and 1791. The US Oil Contract tested the 200d Moving average yesterday but failed to break it, we are currently at 93.93 and the MA at 94.97.
Bitcoin is a little off the recent highs but holding near 24k and Ethereum 1890.
Just now, UK data came less bad than expected with the Monthly GDP only falling 0.6% vs the expected 1.3% and industrial output at 2.4% vs 1.6% expected.
On todays radar we have the French and Spanish CPI at 8:45 and 9:00, the EU Industrial production at 11:00. Out of the US we expect the Import Prices at 14:30 and the University of Michigan Sentiment at 16:00.
With little key economic data, we keep an eye on event risk out of China/Taiwan, Ukraine and mainly the Fed for moves. It could be a fairly quiet day for once if there are no surprises with time to plan positions and investments rather than reacting to data.
Peter Garnry held a webinar yesterday on Equity Market Update: Earnings review and protecting your portfolio
All webinars are available on the page in the lower part if you missed it.
Earnings:
Expiries
Physically Settled Futures:
Lean Hogs (HEQ2) will expire 12th Aug at 17:00 GMT.
Cocoa (CCU2) will expire 17th Aug at 15:00 GMT.
Expiring CFDs:
Cocoanysep22 will expire 16th Aug at 15:00 GMT.
Futures can be rolled online via the Futures Spread Trade Ticket. Any open positions will be closed after the mentioned times.
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.