Senior Relationship Manager
Summary: Traders Careful Ahead of Key Releases
Good Morning,
Nervousness is hitting markets as we are entering the key phase. From today there is a massive event risk from earnings, fundamental economic data and rate decisions as well as outlooks by central banks. Today we are expecting Exxon, UPS, General Motors Co and Caterpillar before market open and Pfizer, McDonalds, Spotify, AMD, Snap, Amgen, EA, after the close.
Yesterday the Dow lost 0.7%, the S&P 500 1.36% and the Nasdaq 2% with Tesla and Nvidia large losers after Fridays gains goth shedding 5%, Apple Amazon and Alphabet lose app 2%.
10 Year US rates climb to 3.55 and the USD Index gains to 102.30. EURUSD receded to 1.0840, GBPUSD to 1.2345 and USDJPY gains to 130.20. Gold falls to 1914 and is just abocve support at 1910, Silver is trading at 23.45.
Oil prices extended losses interest rate increases and continued Russian crude flows cancelled out demand recovery expectations from China. acc. to Reuters.
Consider very carefully how much risk you want to carry into the remainder of the week, consider options for directional bets and as yield enhancement given the high volatility. 25 Delta Tesla calls are trading at 75% implied Volatility for Late Feb/ March.
As a surprise, Australian Retail sales fell more than expected at -3.9% vs -0.3% expected. In terms of economic data we are expecting the EU and Canadian GDP at 11:00 and 14:30, at 16:00 the US Consumer confidence.
Trade safely.
Economic Data & Earnings
Tuesday
Japan Unemployment Rate, Australia Retail sales and China Manufacturing PMI
France, Italy as well as EU GDP, German CPI, US consumer confidence.
Earnings: Exxon, UPS, GM, Pfizer, Caterpillar, McDonalds, Spotify, AMD, Snap, Amgen, EA,
Wednesday
International PMI thorough the day, EU HICP
FOMC Rate decision
Earnings: Altria, T-Mobile, Peleton, ThermoFischer, Meta,
Thursday
Band Of England, ECB Rate decision
Earnings: Merck, Lilly, Honeywell, Sony, Amazon, Apple, Alphabet, Ford, Qualcomm, Starbucks, Gilead,
Friday
International PMI, Nonfarm Payroll
Earnings: Cigna, CBoe, Sanofi
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.