Senior Relationship Manager
Good Morning
Strong Job openings indicated that the labor market in the US is not cooling off, 11.2 million job openings are looking to be filled. Also the Consumer confidence beat expectations. That lead to worries the fed will tighten further and put pressure on equities. The probability of a 75BPS hike rose to 75% before falling back to 70 this morning. Nasdaq as well as the S&P fell below the 50 day moving average.
All 3 Indexes in the US Fell by app 1%, this morning we see a recovery of about 0.6% across the board.
The GER40 is trading at 13025, the US500 at 4011 and the US Tech 100 at 12441.
The USD Index is trading a little below the highs, the EUR remains “strong” on expectations of a hawkish ECB. EURUSD is trading at 1.0036 and GBPUSD at 1.1683. The Japanese Yen is approaching areas again where an intervention by the BoJ may be looming, we are at 138.40. Gold and more so silver fell yesterday but also recovered slightly, Gold is at 1724 and Silver at 18.48.
Oil fell yesterday despite Russia cutting gas in the Nordstream pipeline in an expected move. Corona Numbers in China and rising rates cause worries on demand
Chinas factory activity remains below 50 but beat expectations by 0.2%. The party congress is planned for October.
Bitcoin is above 20k again
Reuters reports liquidity issues in the US treasury markets as the Fed is withdrawing liquidity
For Swiss Franc Traders the official reserves are of interest today at 9, for the Euro, the HICP at 11 will be key. The Nonfarm Payroll on Friday is coming into focus.
Economic Data:
Wednesday: Norway GDP, CH Official reserves, EU HICP, Italy CPI
Thursday: IT, FR, DE and EU PMI, EU Unemployment Rate, US Initial Jobless claims, PMI
Friday: US Nonfarm Payrolls
Expires:
Physically Settled Futures:
RBOB Gasoline (RBU2) will expire 31 Aug at 15:00 GMT
Random Length Lumber (LBU2) will expire 1st Sep at 15:00 GMT
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.