Morning Brew May 4 2022
Senior Relationship Manager
Summary: The Day Traders have been waiting for
Today will be a key day for the USD and Equities.
At 20:00 CET the FOMC will announce the Fed Fund Rate and a hike of 50 bps is expected with a 91% likelihood and 9% for 75 BPS. The difference between Inflation and the Fed fund rate has never been this large – the Fed is clearly behind the curve . The Decision and the following press conference will be the key events of the day.
This will likely make or break the markets as we are at decisive levels in the USD, Precious Metals and also Equities are looking for direction. God and Silver stabilized at low levels – 1864 and 22.55, the USD Index remains near 20 Year highs. For a more detailed technical update for gold and silver from Kim Cramer, our technical analyst, please click here
Equities move little yesterday and with all 3 US Indexes closing within 1% and the dax remains trapped around the 14000.
Oil moved a little higher over on news the EU is looking to stop importing Russian Oil in 6-9 months
The Bund Future lost a full point over night to trade at 152.60 and the US 10 Year remains at 3%.
Peter wrote a great article on Nutiren and it`s competitors:
Nutrien earnings in focus as food prices could destroy confidence: Food prices are up 34% y/y in March and potash (one of the ingredients in modern fertilizers) prices in North America are up 330% from the lows in 2020. Combined with high natural gas prices and various exports restrictions on phosphate the price on fertilizer is going through the roof causing lower crop yields and less profitability for farmers creating an ugly dynamic for food prices this year and potentially next year. We take a look at the underlying factors driving fertilizer prices and highlights the different companies within this theme.
Besides the FOMC we are expecting:
- International PMIs: Germany 9:55, EU 10:00, US 15:45
- EU Retail Sales 11:00
- US and Canadian trade Data at 14:30.
Consider your risk and exposure going into the FOMC, it will be a high risk event with the potential for sharp moves during the release as well as in the press conference.
Physically Settled Futures:
CK2 will expire on 6th May at 09:00 GMT.
FPK2 will expire on 11th May at 15:00 GMT.
GASOILUKMAY22 will expire on 10th May at 15:00 GMT.
OILUSJUN22 will expire on 18th May at 15:00 GMT.
Quarterly Outlook Q2 2022
Quarterly Outlook Q2 2022: The End Game has arrived
- Shocks from covid and the war in Ukraine have forced the global financial and political world to change, but what will the end game be?
Productivity and innovation have never been more importantAs the world economy hits physical limits and central banks tighten their belts, could equities be facing a 10-15% downside?
The great EUR recovery and the difficulty of trading itIf the terrible fog of war hopefully lifts soon, the conditions are promising for the euro to reprice significantly higher.
Tight commodity markets – turbocharged by war and sanctionsWith supply already tight, commodities keep powering on. But will it last for yet another quarter?
Between a rock and a hard placeGeopolitical concerns will add upward price pressures and fears of slower growth, while volatility will remain elevated.
The Great ErosionInflation is everywhere and central banks try to combat it. But will they get it under control in time?
Australian investing: Six considerations amid triple Rs: rising rates, record inflation and likely recessionWhile global financial markets are struggling in an uncertain world, the commodity-heavy Australian ASX index is poised to keep a positive momentum.
Cybersecurity – the rush to catch up with realityWith the invasion of Ukraine, governments and private companies are rushing to reinforce their cyber defenses.