Senior Relationship Manager
Good Morning,
Tomorrow I will be travelling and Monday is Pentecost Monday so I will be back Tuesday.
Economic data was a bit of a mixed bag yesterday and the consensus seemed that nothing happened that would cause central banks to change to a hawkish approach. Indexes eased slightly, the Dow fell 0.54% the S&P 0.75% and the Nasdaq 0.72%. The Dax fell to 14327. Overall volumes are app. 20% below the recent average, people are clearly looking for clues on the overall direction. Our Peter Garnry sees more risk on the horizon in an article.
US 10 Year yields rose to 2.92, pushing the USD Index to 102.50 and EURUSD as well as GBPUSD lower to 1.0655 1.2477. Gold and Silver are astonishingly resilient at 1844 and 21.70, Bitcoin eases to below 30k again. USDJPY is back at the 130. The US 10 year has found decent support it seems
The Turkish Lira falls to near 16.50 against the USD, it will interesting if Erdogan manages to turn his reservations to Finland and Sweden joining the Nato into meaningful economic support.
Oil falls on hopes that OPEC will increase production and make up for some of the supply missing out or Russia.
Mary Daly, President of the San Francisco Fed stated she would like to see a rate of 2.5% as soon as possible and called for hikes of 50bps in the next meetings. JP Morgan CEO Jamie Dimon said he sees a Hurricane coming for the US Economy.
Meta Chief Operating Officer Sheryl Sandberg said announced that she would leave the company after 14 years
Salesforce and Victoria`s secret could gain almost 10% on good results and strong outlooks.
Upcoming Data:
The EU PPI at 10:00 expected at 38.5%
At 14:15 and 14:30 the ADP employment and US labor data will be released, followed by factory orders at 16:00
Tomorrow, German Trade data at 8:00 the EU PMI at 10:00 will be released with the nonfarm Payroll at 14:30 and the US PMI at 15:45
Expect nervous moves on news and remember to check your portfolio for inflation resilience – it is not as temporary as hoped and an inflation rate of 3% at negative rates is quite painful.
Expiries
Physically Settled Futures:
LEM2 will expire 3rd of June at 15:00 GMT.
CONFM2, FBONM2, FBTPM2, FBTSM2, FGBLM2, FGBMM2, FGBSM2, FGBXM2, FOATM2 will expire 7th of May at 15:00 GMT.
Expiring CFDs:
10YBTPJUN22, 10YOATJUN22, BOBLJUN22, BUNDJUN22, SCHATZJUN22 will expire 6th of June at 15:00 GMT.
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.