Senior Relationship Manager
Summary: Apple and Tesla rule the world
Good morning,
The Year started with lots of interesting moves. Apple became the first company to exceed 3 billion USD in Market capitalization and Tesla surged more than 13% on the strong deliveries and strong outlook, the Dow Jones as well as the S&P500 hit new records, the German Dax breached 16000 again.
Bond Yields rose, the US10 year from 1.52 to a1.64, strengthening the US Dollar, the USD Index trades at 96.20, EURUSD and GBPUSD broke lower to 1.1296 and 1.3460, USDJPY reached a 5 year high. The Bund Future fell to 170.50
Gold and Silver lost ground to 1805 and 22.75 on the surge un US Yields
The Turkish Lira remains volatile as inflation soars to 36% in December, the highest in 19 years. Erdogan said app 5 bio USD had been deposited in accounts protected against currency fluctuations by the state.
Bitcoin remains near the descending trendline at 46300.
China Evergrande Group shares jumped as much as 10% after trading again.
Daimler presented a prototype of an EV with a reach of 1000 KM.
We have a full economic agenda and the UK is back from holiday, it could be another interesting day,
At 8 German Retail Sales expected at -4.9%, Swiss CPI at 8:30 expected at 1.6%, 8:45 the French CPI.
UK Mortgage data and PMI 10:30, Canadian PMI at 15:30 and US ISM at 16:00.
Technical Picture By our Kim Cramer Larsen:
S&P500 bounced off its short term rising trendline just before Christmas starting the Santa Claus rally lifting the Index to new All-Time highs. We could see a couple of days with minor correction possibly down to around 4.700. However, RSI in bullish sentiment without divergence support short term bullish outlook.
DAX bounced strongly off its important support at around 15.100 and followed through with moves above both the 200 and 55 Simple Moving Averages (SMA). There has been some consolidation around resistance at around 15.834.
The bounce from 15.100 has formed a double bottom like pattern and after the closing above 15.834 and the confirmation of and uptrend (higher highs and higher lows) there is potential to new All-time highs in the region of 16.425 and 16.600. RSI needs to close above 60 for further confirmation of the uptrend.
A close below 15.834 could see selling pressure down to 15.500 potentially lower.
AI: The good, the bad, and the bubble
While a deep recession may not be iminent thanks to central bank policy, interest rates will have to stay high for longer, and this will be accompanied by volatility risk from the unwinding of bubbles, especially within AI.
Steen Jakobsen,
Chief Investment Officer
The emergence of advanced AI systems is by far the most surprising event this year, turning everything upside down, while risks and benefits are debated. AI will also become an arms race between the US and China.
Peter Garnry,
Head of Equity Strategy
As China navigates global fragmentation, its cycle of technology application, productivity enhancement, and growth is threatened by US breakthroughs in generative AI, limited computing power, and geopolitical tensions.
Redmond Wong,
Market Strategist
Japan’s expertise in semiconductors and robotic integration could be the foundation of AI dominance. Combining two of this year's themes, Japanese equities and artificial intelligence, brings a wave of opportunities.
Charu Chanana,
Market Strategist
The AI fever has turned the technology into a darling, pushing crypto further into no-man’s-land. There are striking similarities between AI and crypto, and if these are to come full circle, AI won't be spared for bubbles.
Mads Eberhardt,
Cryptocurrency Analyst
Stocks related to artificial intelligence (AI) have appeared on investors' radars. Expectations are high, but it may be necessary to consider how to get exposure to AI in a diversified way.
Hans Oudshoorn,
Trainer Academy
The USD is on its back foot as markets celebrate an eventual Fed rate peak and steady long US yields. The stakes are even higher for the Japanese yen if longer major sovereign yield curves have to price in economic acceleration.
John J. Hardy,
Head of FX Strategy
While commodities, broadly speaking, have faced some tough months, a partial reversal during June could signal that the asset class is getting back on its feet with energy holding up and precious metals with upside potential.
Ole S. Hansen,
Head of Commodity Strategy
As inflation remains high central banks face hard decisions about whether they should keep hiking interest rates or stop. Meanwhile, the rise of AI creates bubble-like conditions that only make the decision harder.
Althea Spinozzi,
Senior Fixed Income Strategist