Erik Schafhauser Zürich Erik Schafhauser Zürich Erik Schafhauser Zürich

Morning Brew November 2 2023

Morning Brew 1 minute to read
Erik
Erik Schafhauser

Senior Relationship Manager

Summary:  Higher for a little less long


Good Morning

The Federal Reserve left interest rates unchanged yesterday - as was expected. Jerome Powells comments were not very clear about the path going forward but when he was asked if the Fed maintained a bias towards hiking rates versus keeping policy on hold, he stated "that's the question we're asking. Should we hike more?" This was interpreted as dovish. There remains a slight chance of a hike in either December or January but the December 24 rate is being traded 80 basis points below the current level – more than three full cuts.

10 Year Yields fell to below 4.80 and tested the 4.70 before settling at 4.73 now. The USD Index initially tried to break above the 107 after the rate decision but retreated to 106.35., EURUSD is back above 1.06 but we need a break above 1.0635 for a clear signal. GBPUSD is 1.2180 and USDJPY 150.38.

Equities celebrated the hope the tightening cycle has ended, US Indexes rose more than 1%, AMD gained more than 10% on hopes top catch up against Nvidia. The US500 is testing the 4250, the US Tech 100 is at 14715 and the GER40 has breached the 15000.

The US earning season so far has been more positive than hoped,  80% of the S&P 500 Companies that have reported results so far have beat.

This Morning, , Novo Nordisk reported record sales and operating profits for the quarter but flagged continued restrictions on supplies of Wegovy
Shell reported in line with expectations but announced share buybacks of $3.5 billion over the next three months

Today’s focus will be on the Swiss CPI at 8:30, international PMI, German unemployment , the Bank of England at 13:00, key US Data at 13:30 and 15:00 before the Apple earnings after the close.For the Bank of England today, the probability of no action is 90%.

With the death toll in Gaza rising, the powder Keg in the middle east requires careful attention.

Key Events: 

Thursday
- Data Germany PMI, Swiss CPI, DE Unemployment Rate, Bank of England Rate Decision, US Initial Jobless Claims, Factory Orders.
- Earnings Apple, Palantir, Shopify, Coinbase, Starbucks,

Friday
- Data EU Unemployment Rate, Nonfarm Payrolls
- Earnings Enbridge, RBI,

Trade carefully.

 

Quarterly Outlook 2024 Q3

Sandcastle economics

01 / 05

  • 350x200 peter

    Macro: Sandcastle economics

    Invest wisely in Q3 2024: Discover SaxoStrats' insights on navigating a stable yet fragile global economy.

    Read article
  • 350x200 althea

    Bonds: What to do until inflation stabilises

    Discover strategies for managing bonds as US and European yields remain rangebound due to uncertain inflation and evolving monetary policies.

    Read article
  • 350x200 peter

    Equities: Are we blowing bubbles again

    Explore key trends and opportunities in European equities and electrification theme as market dynamics echo 2021's rally.

    Read article
  • 350x200 charu (1)

    FX: Risk-on currencies to surge against havens

    Explore the outlook for USD, AUD, NZD, and EM carry trades as risk-on currencies are set to outperform in Q3 2024.

    Read article
  • 350x200 ole

    Commodities: Energy and grains in focus as metals pause

    Energy and grains to shine as metals pause. Discover key trends and market drivers for commodities in Q3 2024.

    Read article

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.