Erik Schafhauser Zürich

Morning Brew January 24 2022

Morning Brew 1 minute to read
Erik Schafhauser

Senior Relationship Manager

Summary:  Sell the Rumor buy the fact?


Good Morning

Nervousness got into the markets into the close of last week with fears about growth, inflation, rising rates and a possible escalation in the Ukraine conflict worsen.

Stocks sold off, Volatility is back in the game at 28%.  Bitcoin crashes, over the weekend with lows near 30k to stabilize to 35k.

For the Week, US Indexes lost severely, the Dow lost 4.6% the S&P 500 fell 5.7% and the Nasdaq lost 7.6%  Over night we see a slight recovery with futures up 0.8%. Volumes on US Exchanges was huge with 40% more shares being traded than on average. Global Stocks lost 4.2 Trillion last week acc to Bloomberg and the a chart of the ARK Innovation ETF relative to Berkshire Hathaway went viral showing worth are now at the same performance since early 2020 – Implying that Growth has no longer outperformed value. Elon Musk lost 25 bio in net worth and Jeff Bezos 20 in the week. The QQQ ETF traded 50 bio in Volume on Friday.

Earnings and the FOMC will be key but there are also  lots of data points with potential to move the markets, such as Apple and Tesla earnings. 14000 is a key support in the Nasdaq, Dax around 1500

It may be tone for a pause in the sell off if there are no further bad news, in a sell the rumor buy the fact move. As this week has lots of potential for volatility, as I list below, consider looking  look at optionality when taking on risk.

After a strong week, Gold is trading at 1838, above the key resistance at 1835, the weekly close was on that level. Silver is trading at 24.15. Gold ETF holdings rose the most in 18 months

There was relatively little move in the USD Index, it is at 95.80, 10 year yields at 1.76, EURUSD in back in Midrange between 1.12 and 1.14 after the breakout higher failed, GBPUSD is trading at 1.3540.

Oil had a strong week and broke above the 85.40 level (CL) and the 2021 high. That level needs to hold for further upside.

The top U.S. and Russian diplomats made no major breakthrough at talks on Ukraine on Friday and the US is asking Diplomats families to leave Ukraine. Taiwan reported a large incursion by China's air force in its air defense zone.

Renault SA, Nissan Motor Co and Mitsubishi Motors Corp plan to triple their investment to jointly develop electric vehicles acc to Reuters.

 

Key Economic Data:

Monday: International PMIs 9:15 France, 9:30 Germany, 10:00 EU, 10:30 UK. 15:45 US

Tuesday: German IFO, Case Shiller, Consumer Confidence

Wednesday: Canada Rate decision, US Rate decision

Thursday: US Durable Goods orders and GDP

Friday: Swiss KOF, EU Business Climate, Personal Income, US PCE, University of  Michigan Consumer Confidence.

Compaines:

Monday: IBM

Tuesday: Texas Instruments, Johnson & Johnson, Verizon, American Express, Microsoft., NextEra, Raytheon, General Electric, Lockheed Martin

Wednesday: Christian Dior, Boeing, Anthem, , Tesla, Intel, Abbott Laboratories, AT&T,

Thursday: Diageo, Danaher, Apple, Visa, LVMH, Mastercard, Comcast, McDonald's, SAP SE, Blackstone,

Friday: Charter Communications, Chevron Caterpillar

 

Quarterly Outlook

01 /

  • Upending the global order at blinding speed

    Quarterly Outlook

    Upending the global order at blinding speed

    John J. Hardy

    Global Head of Macro Strategy

    We are witnessing a once-in-a-lifetime shredding of the global order. As the new order takes shape, ...
  • Equity outlook: The high cost of global fragmentation for US portfolios

    Quarterly Outlook

    Equity outlook: The high cost of global fragmentation for US portfolios

    Charu Chanana

    Chief Investment Strategist

  • Asset allocation outlook: From Magnificent 7 to Magnificent 2,645—diversification matters, now more than ever

    Quarterly Outlook

    Asset allocation outlook: From Magnificent 7 to Magnificent 2,645—diversification matters, now more than ever

    Jacob Falkencrone

    Global Head of Investment Strategy

  • Commodity Outlook: Commodities rally despite global uncertainty

    Quarterly Outlook

    Commodity Outlook: Commodities rally despite global uncertainty

    Ole Hansen

    Head of Commodity Strategy

  • Macro outlook: Trump 2.0: Can the US have its cake and eat it, too?

    Quarterly Outlook

    Macro outlook: Trump 2.0: Can the US have its cake and eat it, too?

    John J. Hardy

    Global Head of Macro Strategy

  • Equity Outlook: The ride just got rougher

    Quarterly Outlook

    Equity Outlook: The ride just got rougher

    Charu Chanana

    Chief Investment Strategist

  • China Outlook: The choice between retaliation or de-escalation

    Quarterly Outlook

    China Outlook: The choice between retaliation or de-escalation

    Charu Chanana

    Chief Investment Strategist

  • Commodity Outlook: A bumpy road ahead calls for diversification

    Quarterly Outlook

    Commodity Outlook: A bumpy road ahead calls for diversification

    Ole Hansen

    Head of Commodity Strategy

  • FX outlook: Tariffs drive USD strength, until...?

    Quarterly Outlook

    FX outlook: Tariffs drive USD strength, until...?

    John J. Hardy

    Global Head of Macro Strategy

  • Fixed Income Outlook: Bonds Hit Reset. A New Equilibrium Emerges

    Quarterly Outlook

    Fixed Income Outlook: Bonds Hit Reset. A New Equilibrium Emerges

    Althea Spinozzi

    Head of Fixed Income Strategy

The information on or via the website is provided to you by Saxo Bank (Switzerland) Ltd. (“Saxo Bank”) for educational and information purposes only. The information should not be construed as an offer or recommendation to enter into any transaction or any particular service, nor should the contents be construed as advice of any other kind, for example of a tax or legal nature.

All trading carries risk. Loses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money.

Saxo Bank does not guarantee the accuracy, completeness, or usefulness of any information provided and shall not be responsible for any errors or omissions or for any losses or damages resulting from the use of such information.

The content of this website represents marketing material and is not the result of financial analysis or research. It has therefore has not been prepared in accordance with directives designed to promote the independence of financial/investment research and is not subject to any prohibition on dealing ahead of the dissemination of financial/investment research.

Saxo Bank (Schweiz) AG
The Circle 38
CH-8058
Zürich-Flughafen
Switzerland

Contact Saxo

Select region

Switzerland
Switzerland

All trading carries risk. Losses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money. To help you understand the risks involved we have put together a general Risk Warning series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. The KIDs can be accessed within the trading platform. Please note that the full prospectus can be obtained free of charge from Saxo Bank (Switzerland) Ltd. or the issuer.

This website can be accessed worldwide however the information on the website is related to Saxo Bank (Switzerland) Ltd. All clients will directly engage with Saxo Bank (Switzerland) Ltd. and all client agreements will be entered into with Saxo Bank (Switzerland) Ltd. and thus governed by Swiss Law. 

The content of this website represents marketing material and has not been notified or submitted to any supervisory authority.

If you contact Saxo Bank (Switzerland) Ltd. or visit this website, you acknowledge and agree that any data that you transmit to Saxo Bank (Switzerland) Ltd., either through this website, by telephone or by any other means of communication (e.g. e-mail), may be collected or recorded and transferred to other Saxo Bank Group companies or third parties in Switzerland or abroad and may be stored or otherwise processed by them or Saxo Bank (Switzerland) Ltd. You release Saxo Bank (Switzerland) Ltd. from its obligations under Swiss banking and securities dealer secrecies and, to the extent permitted by law, data protection laws as well as other laws and obligations to protect privacy. Saxo Bank (Switzerland) Ltd. has implemented appropriate technical and organizational measures to protect data from unauthorized processing and disclosure and applies appropriate safeguards to guarantee adequate protection of such data.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.