Erik Schafhauser Zürich Erik Schafhauser Zürich Erik Schafhauser Zürich

Morning Brew July 27 2021

Morning Brew 1 minute to read
Erik
Erik Schafhauser

Senior Relationship Manager

Summary:  Meta falls 20% and pulls social media with it, ECB and BOE up today


Good Morning,

It will be an interesting day. After the close Meta announced disappointing results in terms of users as well as financially, the stock fell after market by 20% and pulled other social media companies like Twitter, Pininterst and Snapchat down as well. The sentiment also weighs on tech in general and after a fairly calm close yesterday, Indexes trade lower over night. If you would like to manage any risk ahead of the US opening, kindly remember that you can route pre-market orders in to the US Markets from 13:00. Go to the trade ticket, select the order type “Algo” and the strategy “Pre-market limit”

The Dax failed  to break above the 15725 yesterday and fell back to 15555.

Besides the US Open, the Bank of England will be in focus, the BOE starts at 13:00 CET, is expected to hike by 25 basis points and outline quantitative tightening. The GBP is currently trading near the upper end of it`s 1.32/1.38 range at 1.3550. A strong surprise would be needed to break out. 1 month Vol is priced at 6.35%.

After the Bank of England the European Central Bank  will announce rates and Mme Lagarde will hold her press conference. At 13:45 the rate will be announced, the press conference at 14:30. No hike is expected but an acknowledgement of higher inflation and a hint at rate hikes. Polls of economists see no hike in 2022 but traders price in the possibility. 1 month Vol is trading at 6.27 EURUSD is  current y 1.1295.

If you have any strong expectation, EURGBP near two year lows could be your trade.

Our Bond Girl Althea Spinozzi outlines her expectation for the ECB and the bond market reaction here:

The ECB will not abide by markets

Gold and Silver are little moved over night at 1805 and 22.50 Bitcoin loses to 36800. and

Yesterday the ADP employment data came much lower than expected, that could indicate a weak non farm payroll tomorrow even if there is no perfect correlation. rather than adding 200k jobs, 300k were lost.

International PMIs through the day could also move the market if they surprise so we are in for an interesting day.

Economic Data:

Thursday: International PMIs, EU PPI , UK rate decision, EU Rate decision, US Employment data and factory orders

Friday: Germany Industrial Orders, EU retail sales, US Nonfarm Payroll

Earnings:

Thursday: Roche Ford Amazon.com Eli Lilly Shell  ConocoPhillips , Estee Lauder Cos Inc

Friday:: Bristol-Myers Squibb,  Sano FP

 

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)
Full disclaimer (https://www.home.saxo/legal/saxoselect-disclaimer/disclaimer)

Saxo Bank A/S (Headquarters)
Philip Heymans Alle 15
2900
Hellerup
Denmark

Contact Saxo

Select region

International
International

Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

This website can be accessed worldwide however the information on the website is related to Saxo Bank A/S and is not specific to any entity of Saxo Bank Group. All clients will directly engage with Saxo Bank A/S and all client agreements will be entered into with Saxo Bank A/S and thus governed by Danish Law.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.