Senior Relationship Manager
Summary: Stocks rebound - Buy the Dip?
Good morning,
Risk made a strong reversal yesterday – after a sharp drop early in the day (up tp 3% in the Nasdaq) it made it to positive territory – if only by 0.05%.
The chief global markets strategist at JPMorgan believes the current sell-off presents a buying opportunity and that going forward, there is "more room for the Fed to surprise on the dovish than hawkish side” acc to Reuters.
The Tech Giants closed mostly positive with Apple at 172.19, Amazon at 3229, Google at 2773 and Tesla at 1058. Nvidia 274 – mostly positive or neutral, Facebook fell 1% against the trend.
Goldman Sachs, Deutsche Bank and JPMorgan now expect four U.S. interest increases this year starting in March, more hawkish than a week ago, Fed funds futures see 3.5 hikes in 2022. US 10 Year yields rose to above 1.8% yesterday before dropping below.
FX moved little, waiting for clues from Powell`s hearing today and the CPI number tomorrow. GBPUSD trades near the 1.36 at 1.3590, EURUSD at 1.1340 and the Japanese Yen at 115.20. EURCHF reached 1.05 again for the first time since November.
Gold and Silver could gain to 1809 and 22.60 again,
Turkey has included corporate foreign currency and gold deposit accounts converted to lira, the measure failed to impress markets and we are still at 13.75 Lira against one USD, the current account balance at 8 could be of interest.
The US reported 1.35 million new coronavirus infections on Monday
Bitcoin tested a break below the 40k but could recover to 42000, confirming the support at 40k level again.
There are no key events on the agenda, Jerome Powell testifies in the Senate at 1600.
The Exchange ICE is no longer issuing Key Information Documents for the the ECX EUA Futures, hence the market will no longer be accessible to Retail clients. Please use the CFD EMISSION instead.
Trade safely
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.