Dallas Fed PCE For Januray 6.30% Vs 4.00% Prior – SPDR S&P 500 (ARCA:SPY)

Bank Of Canada (BoC) And ECB Interest Rate Expectations | Redundancies Of 4,000 Employees At Philips

Saxo Bank 24.10.2022 12:51

Summary:  Equities snapped back higher Fri to close the week on a positive notation and near the highs for the week, maybe as the persistent ascent in The states treasury yields finally reversed sharply intraday on Friday after posting new cycle highs. The positive mood carried over into the early Asian session overnight as yields fell further, but sentiment has soured again slightly ahead of the open up of the European session today. The Japanese yen weakened later Friday’s wild rally from new multi-decade lows, a move that was likely intervention-driven. The week ahead will feature earnings reports from the largest U.s.a. megacaps.   What is our trading focus? Nasdaq 100 (USNAS100.I) and S&P 500 (US500.I) Strong equity session on Friday with S&P 500 futures closing at a weekly high and this morning the index futures briefly pushed above the iii,800 level which is quite startling given the price action out of China. Many of the big The states companies take considerable revenue exposure to Communist china, so there is a downside chance here to US companies as the increasing political risk premium on Chinese equities could bear upon valuation on U.s. companies with large Chinse exposure. The falling US 10-year yield probable driven by safety-haven seeking flows is offsetting at the margin some of the headwinds for U.s.a. equities, but the medium-term outlook remains negative. It is also a massive earnings flavor week in the US with about of the mega caps reporting earnings, so volatility could easily pick up during the week in the effect that these earnings surprise to the downside. Hang Seng (HK50.I) In light of the events over the weekend in China with Xi Jinping drawing upward a new leadership in China (see more in-depth analysis below), the Hang Seng Index is selling off 6.4% to price levels seen as far back as 2005; in the total return ground is non quite as bad. The disinterestedness valuation on Hang Seng Alphabetize has fallen to less than viii on 12-month forward P/East ratio suggesting that a steep political take chances premium is being built into Chinese equities. Chinese mainland shares are down 3.2% during the session likely reflecting the departure in foreign ownership. Wild ride for JPY traders Fri, probable on intervention The yen spiked farther to the downside as global bond yields connected to rising Friday, with USDJPY nearly reaching 152.00 before what may accept been a powerful intervention from official Japanese sources took USDJPY as far s as sub-146.l levels on Friday as bonds also plant support. Japan’s finance minister Shunichi Suzuki said that the land is in a showdown speculators and can’t tolerate “excessive” moves in the JPY. The activeness has sprung back overnight, taking USDJPY back to the 149.00 area in early on European trading today. Other USD pairs have moved in sympathy with the wild volatility in JPY, with sudden USD weakness late Fri following through in places overnight only reversing later in the session. Elsewhere in FX, sterling is bid on hopes of an orderly transition to a new prime minister, nearly likely Rishi Sunak. Crude oil (CLZ2 & LCOZ2) Crude oil has given back some of Friday’s weaker-dollar-driven gains every bit fears over the global economic outlook continues to offset OPEC+ production cuts and EU sanctions on Russian oil flows from early Dec. A batch of delayed economic data out of China and President Eleven tightening his grip on the country also helped sour sentiment at the start of a new calendar week. Overall, however, the oil market place judging from the bullish bend structure remains tight signalling no piece of cake path for those looking for lower prices. Focus this week on earnings from Exxon, Crush and their Big Oil peers. HG Copper trades near resistance in the $three.5lb area … post-obit an finish of week rally that was triggered by a weaker dollar and softer yields (see below). A batch of data released past Prc overnight saw copper imports reach their second highest level this year and despite the current property market crisis, the metallic is seeing rising need in guild to furnish low stock levels and from clean energy production which is taking hold even as China’s broader demand for bolt have seen a slowdown due to lower economic activity. Speculators have traded copper from the brusk side since April, and a intermission above $3.70 is likely to be the minimum requirement for that to alter. Gilt (XAUUSD) Gold reached $1670 overnight as Friday’s rally extended into the Mon session, and apart from speculation about the timing of a peak-and-reversal in United states treasury yields, it is the current wild ride in USDJPY that has got the algo’s going wild in both directions. While nosotros maintain our long-term bullish view on gilt and silver, the price activeness has yet to ostend a reversal. This despite the second failed attempt terminal calendar week to break lower through key support at $1617. The exodus from bullion backed ETFs has gathered step recently as investors instead focus on increasingly attractive bail market yields. Gilded will likely continue to trade in a inclement style until we reach peak hawkishness and/or the dollar starts to weaken. Usa treasuries (TLT, IEF) US treasury yields spiked farther on Fri, with the 10-year treasury yield benchmark posting a remarkable 4.33% earlier treasuries finally institute stiff support, endmost the mean solar day slightly below the prior day’southward close of four.22% and following through to 4.sixteen% in early on European trading today. Could this prove a climax summit-and-reversal in yields? We would need to run into the yield piece of work back downwardly below 4.00% for a stronger indication. Noted “Fed whisperer” Nick Timiraos of the Wall Street Journal penned an commodity at the weekend suggesting that the Fed is preparing for a downshift in the step of charge per unit hikes past early on side by side year (more below). US 2-twelvemonth yields are also sharply lower from the Fri highs, having fallen some 20 basis points and trading near 4.43% this morning time. What is going on? China’s Communist Party’s new leadership Communist china’s General Secretary Xi lined upwardly a team who deeply share his vision of the futurity of Cathay and the blueprint of the governance model and development strategies that he had established to replace four of the seven members of the Chinese Communist Party’s Politburo Standing Committee, including Li Keqiang, Premier. The strategies of common prosperity, high-quality evolution, dual circulation, technology self-reliance, strengthening governance within the CCP, and deepening CCP’s leadership over all aspects of the land will go on. WSJ’southward Nick Timiraos suggests the Fed is eyeing a slowdown in its pace of tightening Timiraos is widely considered to have solid access to Fed sources and in a piece released this Saturday, affirms the market view that the Fed may begin to downshift from the 75-footing point hike pace, perchance already after the Nov meeting and eventually intermission the tightening authorities at some signal early side by side year to offer time to assess the bear on of the rapid footstep of rate hikes, which took the Fed Funds rate from 0-0.25% as late as March of this year to a projected 4.25-4.50% afterwards the December meeting. But he also notes the variety of opinions amongst Fed officials, some of whom are in favour of carrying on with the current pace of tightening and not wanting to signal any modify in resolve as long every bit inflation persists anywhere near current levels. Philips in urgent restructuring laying off iv,000 employees The Dutch industrial conglomerate has been a mess for years and this forenoon the company is reporting revenue and EBITDA in line with estimates, but announcing a big restructuring of the visitor laying off iv,000 employees to improve profitability ahead of what the visitor expects to be more challenging times. What are we watching next? Former UK Chancellor Rishi Sunak may become next UK Prime Minister today Former PM Boris Johnson announced at the weekend that he will non run for leadership of the bourgeois party. The deadline to announce support from at least 100 Tory lawmakers is today at 14:00 U.k. time, with the only challenger to Sunak’s bid Penny Mordaunt, who may not accept sufficient votes. Sunak has over 100 backers and will automatically become the next Prime Government minister if Mordaunt tin can’t muster sufficient support for a run-off. Banking company of Canada and ECB set to hike by 75 basis points this calendar week On Wednesday, the Banking company of Canada (BoC) is expected to hike interest rates by equally much every bit 75 basis points, taking the policy rate to four.00% if they do and so, later on a hotter than expected CPI print in September for Canada. On Thursday, the European Cardinal Banking concern (ECB) will too further tighten its monetary policy to fight confronting widespread and persistent inflation. Nosotros think that the ECB will have no other choice but to transport a hawkish message to the markets (meaning a 75-basis indicate interest rate hike) and signal further hikes to come, at to the lowest degree until February 2023. Information technology is likely that the central depository financial institution will downshift interest rate hikes in December 2022 and in February 2023 to take into consideration the ongoing economic slowdown (which may end upwardly in a recession). At this week’s meeting, the ECB governing council volition also discuss two other matters: i) Quantitative tightening and when/how information technology should kickoff. Just a final decision is not expected until Dec; 2) commercial banks’ early repayment of TLTRO (for Targeted Longer-term Refinancing Operations to provide financing at very low rates to credit institutions). Those 2 points are unlikely to exist major market movers. Further pressure level on Japan’south yield curve command? Terminal week, the Bank of Nihon (BoJ) was forced to start emergency bail ownership operations to maintain its yield curve control (YCC) policy. Pressure could remain loftier this week again. Several factors are pushing yields higher in Nippon: highest inflation impress since 1991, calls for very large wage increases and the continued upward migration in global yields, of course. Earnings to watch Around 430 earnings releases expected this calendar week in the earnings universe that we encompass during earnings seasons. Out of those more than 400 earnings releases, the virtually important ones are highlighted below. By the stop of this week, we will have an adequate view into revenue growth, operating margin, and earnings growth on a both q/q and y/y basis. Today: Nidec, Philips, Cadence Design Systems Tuesday: Get-go Quantum Minerals, Canadian National Railway, DSV, UPM-Kymmene, SAP, HSBC, ASM International, Norsk Hydro, Novartis, UBS, Kuhne + Nagel, Microsoft, Alphabet, Visa, Coca-Cola, Texas Instruments, UPS, Raytheon Technologies, General Electrical, 3M, General Motors, Valero Energy, Biogen, Enphase Energy, Halliburton, Spotify Technology Wednesday: Dassault Systemes, Mercedes-Benz, BASF, Deutsche Bank, PingAn Insurance, CGN Power, UniCredit, Canon, Barclays, Standard Chartered, Heineken, Aker BP, Iberdrola, Banco Santander, SEB, Meta Platforms, Thermo Fisher Scientific, Bristol-Myers Squibb, ADP, Boeing, ServiceNow, Ford Motor, Twitter Thursday: ANZ, Anheuser-Busch InBev, Argenx, Shopify, Teck Resources, Neste, Kone, TotalEnergies, EDF, STMicroelectronics, PetroChina, Red china Life Insurance, CNOOC, Oriental Land, Shin-Etsu Chemic, Takeda Pharmaceuticals, Hoya, FANUC, Shell, Lloyds Banking Group, Universal Music Group, Repsol, Ferrovial, Hexagon, Evolution, Credit Suisse, Apple, Amazon, Mastercard, Merck & Co, McDonald’s, Linde, Intel, Honeywell, Caterpillar, Gilead Sciences, Pioneer Natural Resource Friday: Macquarie Grouping, OMV, ICBC, Communist china Merchants Bank, LONGi Green Free energy Engineering science, Midea Group, Imperial Oil, Danske Bank, Sanofi, Airbus, Volkswagen, Red china Construction Bank, Agricultural Bank of Communist china, Bank of Red china, BYD, China Shenhua Free energy, Eni, Keyence, Hitachi, Denso, Equinor, CaixaBank, Wilmar International, Swiss Re, Exxon Mobil, Chevron, AbbVie, NextEra Energy, Colgate-Palmolive, Royal Caribbean Cruises Economical calendar highlights for today (times GMT) 0715-0800 – Eurozone Oct. Flash Manufacturing and Services PMI 0830 – UK Oct. Wink Manufacturing and Services PMI 1230 – United states Sep. Chicago Fed National Activeness Alphabetize 1345 – US Oct. Flash Manufacturing and Services PMI Follow SaxoStrats on the daily Saxo Markets Telephone call on your favorite podcast app: Apple  Spotify PodBean Sticher Source: https://www.home.saxo/content/manufactures/macro/market place-quick-accept-october-24-2022-24102022