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Early Morning Call: Ocado posts £500m full-year loss while retail revenue falls 3.8%

The group says that if customer growth remains robust, revenue was affected by lower basket value.

 Angeline Ong | Presenter, Analyst and Content Editor, London | Publication date: Tuesday 28 February 2023 

Equity market overview

Equity markets mostly rose overnight in the Asia-Pacific region, in the wake of the rebound of US indices.

In Japan, industrial production fell at its fastest pace in eight months, down 4.6% in January compared to December, more than economists' forecast of a 2.6% decline. Component supply bottlenecks seem to be the main reason for this poor performance. Semiconductor-making equipment was down 26.8%, output of auto products fell 10.1%, and production machinery dropped 13.5%.

In contrast, retail sales posted their fastest growth in nearly two years, rising 6.3% in January from a year earlier, beating a median market forecast for a 4.0% gain, and logging an eleventh straight month of expansion.

In Australia, retail sales rebounded in January, up 1.9% on a monthly basis, after a surprise 4% dive in December. That was higher than the 1.5% anticipated by the market. If we look at bank cards spending data, Australian consumers have preferred splashing out on services, rather than on the goods.

In Europe, equity markets open marginally lower. In France, consumer price index rose 6.2% in February year-on-year (YoY), higher than the 6.1% anticipated. Unlike most western economies, France has not showed signs of receding inflation yet. The harmonised index, the one the European Central Bank (ECB) looks at, rose to 7.2%.

Government measures to support French households have brought down inflation by an estimated three percentage points in 2022. But these measures are coming to an end. Electricity bills have increased by 15% in February, which has led economists to forecast that France inflation will soon be higher than the euro area average.

On the other side of the Atlantic, Canada's fourth quarter (Q4) GDP growth rate is expected at 0.4% compared to the previous quarter.

Macroeconomics

A few macroeconomic indicators are also scheduled in the US: wholesale inventories, S&P/Case-Shiller home price index, Chicago PMI, and conference Board consumer confidence.

Earnings

Elsewhere on the equity market, Ocado posted a half a £501 pretax loss for 2022, £324 million lower than full-year (FY) 2021. The group announced a loss before interest tax depreciation and amortisation of £4m in its retail segment, down for £150m profit a year ago. Revenue at Ocado Retail is down 3.8% to £2.2 billion.

The group says that if customer growth remains robust, revenue was affected by lower basket value.

British asset manager Abrdn also posted a pretax loss for the full-year of £615m compared to a £1.1bn profit the prior year, and signalled a fall in client funds for 2022, down 8% to £500bn.

Bayer, the German agriculture and pharmaceuticals company, posted a marginally higher than expected full-year EBITDA of €13.51bn but warned that its operating earnings are likely to decline in 2023, hurt by higher costs. Bayer sees its 2023 EBITDA between €12.5bn and €13bn.

In the US, Zoom Video Communications shares jumped over 7% in extended trading, after the group forecast an annual profit above analysts' expectations. The group posted earnings of $1.22 per share in the fourth quarter (Q4), on revenue of $1.12bn, both lines beating Sall Street forecasts. For its fiscal 2024, Zoom expects profit of between $4.11 and $4.18 per share, around 50 cents higher than analysts' estimates.

Tonight, after the close of the US market, PC and printer maker HP Inc is scheduled to report earnings and sales for its fiscal first quarter. The market expects earnings of 74 cents per share and revenue $14.15bn.

A year ago, HP posted EPS of $1.10 and revenue of just over $17bn, reflecting an industry-wide fall in PC shipments of 16% in 2022. So far this year, the stock has risen around 9%, but is still down about 25% from its 52-week high last April.

 

 

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Charting the Markets: 28 February

FTSE, DAX and Nasdaq rolling over as eurozone inflation turns upward. GBP/USD and USD/JPY all move higher. WTI on track for fourth monthly decline, gold and copper their first this year.

Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Tuesday 28 February 2023

 

 

 

 

 

 

16 Candlestick Patterns Every Trader Should Know | IG US

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

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Today’s coverage:

Indices: Europe expected to climb at the start after Asia rose on good China PMI data  

FX: AUD fell after Aussie GDP grew at slowest pace in a year. Watching EURUSD had of German jobs and CPI data

Equities: Earnings from PSN JET AML RB. HP climbed 3.5% last night after Q4 earnings

Commods: NY OJ back up at record high – US revised down prodn ests. Gold up for a third day. Oil benefits from good China data  

 

 

 

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Early Morning Call: Hang Seng jumps over 4% as China PMI rises at fastest pace in a decade

Equity markets rose in the Asia-Pacific region, ignoring the decline in yesterday’s session in the US.

Jeremy Naylor | Analyst, London | Publication date: Wednesday 01 March 2023

 

Equity market overview

Equity markets rose in the Asia-Pacific region, ignoring the decline in yesterday’s session in the US.

Hong Kong’s Hang Seng led gains in the region as China's manufacturing activity expanded at the fastest pace in more than a decade. The official NBS manufacturing PMI rose to 52.6 in February from 50.1 the previous month, a figure that far exceeded analysts' forecasts of 50.5.

The Caixin/S&P PMI, a survey of China's private sector, rose for the first time in seven months to 51.6, also well above expectations.

Australia’s ASX 200 was the laggard overnight, after the release on the country’s latest GDP data. GDP rose 0.5% in the December quarter compared to the third quarter (Q3), its weakest pace in a year, and missing a forecast of 0.8%. Q3 GDP was however revised upwardly to 0.7% quarter-on-quarter (QoQ). Annual growth remained at 2.7%.

In the UK, the Nationwide house price index fell 1.1% year-on-year (YoY) after a rise of 1.1% the previous month, the first annual decline since June of 2020, and the biggest drop since November of 2012.

Later this morning, Germany's unemployment rate is expected to rise to 5.6% in February, from 5.5% in January. And at 1pm, Germany's consumer price index (CPI) is forecast to decelerate to 8.5% in February YoY, from 8.7% in January.

In the US, ISM manufacturing PMI is forecast to rise to 48 in February, from 4 7.4 the previous month.

Corporate update

On the corporate front, Persimmon posted an underlying operating profit of £1 billion, up 2%. Profit before tax, however is down to £730 million, from £966m a year ago, reflecting an increase in money set.

Reckitt Benckiser posted full year (FY) like for like (LfL) sales up 7.6% to £14.45bn. Operating profit increased by 9.2% at constant currency to £3.44bn. Full year dividend was up 5% to 183.3 pence per share.

Europe's largest meals delivery company Just Eat Takeaway.com reported EBITDA of €19 million, compared with a loss of €350 million in 2021. Revenue fell 4%.

HP reported mixed earnings yesterday after the US market close. The PC and printer maker posted earnings of 75 cents per share, one cent above analysts' expectations. Revenue fell nearly 19% to $13.8bn, the steepest drop since 2016, missing analysts' estimates of $14.12bn.

However, HP's forecast reassured investors. The group said it anticipates adjusted profit above estimates, between 73 and 83 cents for the current quarter, and maintains its full year earnings target. HP counts on benefiting from cost cuts and a recovery in demand in the China market.

Today, the market awaits reports from Dollar Tree, Snowflake and Salesforce.

Commodities

API crude oil inventories showed yet another substantial increase last week. Crude stocks rose 6.2 million barrels, taking the total number of barrels gained so far this year to nearly 59 million barrels.

Gasoline stocks rose nearly 1.8 million barrels, while distillates fell by 341,000.

Separately, the EIA revealed yesterday that US crude oil production fell in December to 12.10 million barrels per day, its lowest since August 2022.

NY frozen orange juice just set a new all-time high, after the release of new official forecast. Orange production in Florida, which accounts for 80% of US production, is expected to fall by nearly two-thirds from last year, at levels not seen since the Great Depression.

The United States Department of Agriculture now estimates that production will reach 16 million boxes, down two million boxes from the January forecast, which would be 61% less than last season's production.

In 2022, Florida was hit by Hurricane Ian, Hurricane Nicole, a January freeze, and a disease called "citrus greening". And now producers need to replant, but this takes time. At least three years are required for a tree to bear fruit, and producers won't make a profit before six to nine years. To give you an idea, economic consequences from hurricane Irma that hit Florida in 2017 are still being felt in the region.

 

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Charting the Markets: 1 March

FTSE 100, DAX 40 recover on solid China PMI data while Dow nears key support. And gold and oil prices rally, while lumber pushes towards 50-day MA.

Joshua Mahony | Senior Market Analyst, London | Publication date: Wednesday 01 March 2023 

 

 

 

 

 

16 Candlestick Patterns Every Trader Should Know | IG US

 

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Look Ahead to 2/3/23: Japan Consumer Confidence; eurozone CPI; ITV, Taylor Wimpey, Best Buy results

Trading opportunities on Thursday include consumer and inflation data from Japan and the eurozone. Results of note include those from ITV (ITV), Taylor Wimpey (TW), and Best Buy (BBY).

Angeline Ong | Presenter, Analyst and Content Editor, London | Publication date: Wednesday 01 March 2023

 

 

 

 

 

 

 

 

 

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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

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Today’s coverage:

Indices: Europe mixed to lower after declines across the board in Asia and the Dow the only gainer yesterday on Wall St and that was only a small gain

FX: USD slightly higher after recently beaten down by stronger inflation in Europe and a pick-up in China

Equities: Earnings – ITV LSE HLN TW BBY. TSLA down 6.9% after its investor day focussed in on shrinking margins with cheaper models 

Commods: Gold small losses after 3-days of gains.  Oil holding 2-week highs. London Cocoa at 6yr high on short supplies 

 

 

 

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Early Morning Call: FTSE 100 outperforms other European indices as ITV, Haleon report

Europe to open mixed to lower after declines across the board in Asia while the Dow was the only gainer, albeit small gains, yesterday on Wall Street.

 Jeremy Naylor | Analyst, London | Publication date: Thursday 02 March 2023

Equity indices overview

Equity markets recorded small losses overnight in the APAC region, following the lead of US markets yesterday.

In Japan, consumer confidence marginally rose to 31.1 in February, from 31 the previous month. Economists had expected on average the index to rise to 32.

USD

The US dollar trades lower against major currencies this morning, in the wake of strong China data and stronger than expected inflation in France and Germany. Still, the greenback remains on a upward trend in place for a month now, and could well rise again ahead of the Jerome Powell testimony next week.

Recent data in the US shows that inflation is not slowing as fast as expected, and the job market remains hot, prompting US policymakers to question the policy in place. Shall the Federal Reserve (Fed) be more restrictive or show patience and maintain its tight monetary policy for a longer period of time?

Two Fed board members expressed their views yesterday. Minneapolis Fed President Neel Kashkari said he was inclined to continue to raise further, beyond the 5.4% level that he previously thought would be adequate to lower inflation. Raphael Bostic recommends patience. In an essay released yesterday, the Atlanta Fed President still feels a federal funds rate set in a range between 5% to 5.25% would be adequate, but it would need to be kept at that level "until well into 2024".

Macroeconomic indicators

A few macroeconomic indicators are expected today. Later this morning, eurozone consumer price index (CPI) is expected to rise 8.2% in February year-on-year (YoY), after 8.6% the previous month, although that figure could be stronger than thought, after the latest inflation data in France, Germany and Spain that came in higher than forecast.

Also, at 10am, the unemployment rate is forecast to remain at 6.6% in January.

In the US, initial jobless claims are expected at 1.30pm. Economists expect 195,000 new claimants for last week.

Corporate calendar

On the corporate front, ITV adjusted group EBITA was down 12% at £717 million largely reflecting the planned investment in M&E to drive future growth.

Taylor Wimpey flagged weaker sales and a lower order book this year, down to £2.15 billion from £2.90bn a year earlier, and CRH increased its share buyback programme after a record 2022.

In the US Tesla shares fell 7% in extended trading, following the company's investor day yesterday. The electric vehicle (EV) company has flagged a paradigm shift in the way cars are built, saying that manufacturing improvements can lead to a 50% reduction in production costs and pave the way for a "new generation" of electric vehicles, including the long hinted-at "low cost" Tesla.

In a four-hour presentation that began with a look at how the global economy can switch to electric from combustion engines, and save money and resources, Tesla outlined how it plans to scale, massively, its electric vehicle and stationary battery storage production to accelerate the world's transition to carbon neutral. But it seems that investors and traders believe it will all come at a cost to margins.

In terms of US earnings, electronics retailer Best Buy, an all-session stock on the IG platform, is expected to post fourth quarter (Q4) earnings before the US market opens. Analysts anticipate earnings of $2.10 per share on revenue of $14.70bn.

Also expected today, Broadcom and Costco Wholesale.

Commodities

US crude oil inventories rose for the 10th week in a row, to their highest level since May 2021. Crude oil inventories rose by 1.2 million barrels last week.

Gasoline stocks fell by 900,000 barrels and distillate inventories were up by 200,000 barrels.

 

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EUR/USD slips while USD/JPY rises as greenback appreciates, EUR/GBP rallies post EU/UK trade deal

Outlook on EUR/USD, EUR/GBP and USD/JPY amid rising US dollar and EU/UK trade deal.

 Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Thursday 02 March 2023 

EUR/USD’s rally is taking a breather as US dollar appreciates

EUR/USD’s rally on stronger-than-expected French and German preliminary consumer price index (CPI) data is running out of puff as the US dollar regains recently lost ground following the publication of US construction and manufacturing data and rising US yields, with the 10-year US treasury yield trading back above the psychological 4% level. The cross is thus slipping back from Wednesday’s $1.0691 high towards the $1.0613 mid-February low.

A fall through the next lower low seen at $1.0566 on Wednesday would call for the resumption of the February descent with the late February low at $1.0533 then being eyed, ahead of the $1.0484 to $1.0444 support area. It consists of the mid-November high, early December and January lows and is expected to hold when reached.

In case of a currently unexpected rise to above Wednesday’s high at $1.691 occurring, the 55-day simple moving average (SMA) at $1.0718 would be in sight.

EUR/USD chartSource: IT-Finance.com

EUR/GBP surges higher on weakening pound

Over the past few days EUR/GBP rallied strongly on the UK/EU post-Brexit ‘Windsor’ trade agreement to do with Northern Ireland which is pushing the pound sterling lower.

The cross so far rallied to Wednesday’s £0.8896 high, a rise above which seems to be on track which would then open the way for the £0.8928 mid-February high to be reached. Further up sits the early February peak at £0.8978.

Slips should find support between the 24 February high and the 55-day SMA at £0.8836 to £0.8828.

EUR/GBP chartSource: IT-Finance.com

USD/JPY resumes its ascent

USD/JPY’s retest and then bounce off the February-to-March uptrend line on Wednesday has put the 200-day SMA at ¥137.25 back on the cards as the greenback strengthens further. The rise in the cross is taking place despite Japan consumer confidence edging up to a six-month peak and Japan capital spending rising by 7.7% year-on-year (YoY) in the fourth quarter (Q4) of 2022.

Further up lie the December highs at ¥137.85 to ¥138.17 which are also being targeted.

Immediate upside pressure should be maintained while Wednesday’s low at ¥135.26 isn’t being slipped through. Below this level sits the ¥134.77 January high and the 24 February low at ¥134.06. While it underpins, the February-to-March uptrend will remain intact.

USD/JPY chartSource: IT-Finance.com
 
 
 
 
 

16 Candlestick Patterns Every Trader Should Know | IG US

 

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Look Ahead 3/3/23: China Caixin; US non-manufacturing PMI; Lufthansa earnings

Global growth swings back into focus with the Caixin services PMI out of China, non-manufacturing PMI from the US and trade data from Germany. Plus, earnings from Lufthansa are likely to reflect the ‘revenge travel’ trend.

 Angeline Ong | Presenter, Analyst and Content Editor, London | Publication date: Thursday 02 March 2023
 
 
 
 
 
 
 
 
 
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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

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Today’s coverage:

Indices: Europe to open higher after gains on Wall St and Asia. NKY highest since 15 Dec

FX: Japan unemployment data shows a surprise drop while Tokyo CPI decelerating from 42-yr high strength for JPY. China Caixin Services PMI highest in 4yrs. Watching EURUSD head of US ISM services PMI

Equities: Earnings – LHA PSN. Watching possible Silvergate bankruptcy in the wake of FXC? (Bitcoin down 4%+). Foxconn apple iPhone manufacturing shift from China to India

Commods: Gold up for 5th day. Oil hits highest in more than 2 weeks 

 

 

 

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Early Morning Call: Risk back on as markets climb

Better than expected data out overnight, from both Japan and China, have helped traders take a more bullish position.

Jeremy Naylor | Analyst, London | Publication date: Friday 03 March 2023

 

 

 

 

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This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

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Today’s coverage:

Indices: Europe expected to open higher today after Friday’s late gains in the 24hr mkts. CAC40 closed at a new all-time record high.

FX: China growth target for 2023 disappoints economists USDCNH little changed but Dollar basket down. EURUSD awaiting EU retail sales   

Equities: Silvergate suspends its exchange network 

Commods: Gold up for 6th day. Oil down for first day in a week and Sugar hits 6yr high 

 

 

 

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Early Morning Call: Risk back on - CAC40 at record high

China indices trade lower than their APAC counterpart as the country set itself a growth target at "around 5%" for 2023. It is a rebound from last year's 3% growth, but analysts generally expected China to set a GDP target of above 5%

This week will be punctuated by a few central bank meetings and speeches, starting Tomorrow with the RBA, followed later in the day by Fed Chair Jerome Powell's testimony to the US Senate. On Wednesday, the Bank of Canada, and Powell's Testimony to the House Financial Services Committee, and on Friday, the BoJ interest rate decision.

While the US earnings season has come to an end, full-year reports are still coming in the UK. On Tuesday the market expects Greggs and Ashtead, followed on Wednesday with Legal and General, and PageGroup and Aviva on Thursday.

On the soft commodity market, Sugar is the latest to hit multi-year high, after Orange Juice and Cocoa in recent days.

 

 

 

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This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

 

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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

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Today’s coverage:

Indices: Europe expected to open down after new 13mth highs on the Dax and new all-time record high on the CAC.

FX: Little move in USD ahead of the 1st of 2 days of Powell testimony to House & Senate. AUDUSD hits support after the RBA raised rates 25bps as expected to highest in a decade 3.6%. GBPUSD near 2023 high despite a another slowdown in UK retail sales – BRC 

Equities: GRG AHT RCH all on earnings at 7amUK. Meta, another round of job cuts

Commods: Oil closing in on 6wk highs on supply concerns and thoughts that China demand will pick up. Gold little moved 

 

 

 

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Early Morning Call - March 7, 2023

It was a mixed session overnight in APAC region, following the path of US session yesterday, Meanwhile, in Europe, France 40 trades at all-time high, and Germany 40 at a nine-month high. On the currency market, the US dollar remains subdued ahead of Jerome Powell’s Testimony to US Senate. British pound rises against all major currency after Halifax house price index unexpectedly rose in February. The Australian dollar is the worst performer after the RBA hike its interest rate by 25 basis points to 3.6% as expected.

Elsewhere on the equity markets, Greggs posts profit in line with expectations, Ashtead raises its full-year earnings forecast, Reach posts a 27% drop in annual profit, and over in the US Bloomberg News reveal that Meta Platforms is to cut thousands of jobs as soon as this week.

 

Jeremy Naylor | Analyst, London | Publication date: Tuesday 07 March 2023

 

 

 

 

 

 

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This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

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Today’s coverage:

Markets respond to Powell’s hawkish words on US rates

Indices: Europe holding Tuesday’s losses. All major mkts down apart from the NKY near to 6mth highs as the weakening JPY helps Japanese exporters

FX: USD climbed across the board, to levels not seen since 1 Dec, after Powell warned about still higher US rates to combat stubborn inflation. Now awaiting US ADP data 1:15pmUK today

Equities: Earnings – LGEN DARK GFRD TLW ADS CON. Silvergate in talks to salvage the bank. WW up 80% as it moves into obesity drug space

Commods: Asset class suffering from USD strength. Gold slumped, but not as far as silver which is at 4mth lows. Oil down as the argument for worsening demand outlook returns  

 

 

 

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Early Morning Call: All asset classes move on Powell comments

Fed Charman Jerome Powell has warned that the US Federal Reserve is prepared to return to bigger interest rate rises to fight inflation. He told the Senate banking committee that "the ultimate level of interest rates is likely to be higher than previously anticipated" and said recent economic data was "stronger than expected". Adding "If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes." This prompted a rise of the dollar, a stock market sell-off, and a losses across the commodity space.

The Bank of Canada is set to become the first major central bank to hit pause on interest rates. Economists and markets expect BOC Governor Tiff Macklem to hold the benchmark overnight rate at 4.5% later today, ending a streak of eight consecutive increases. That would follow through on a January pledge to keep rates where they are while the bank assesses the impact of its tight.

On the equity market Legal & General posts stronger-than-expected operating profit, Galliford Try unveils a 65% of its profit before tax in the first half. In Germany, Adidas slashes its 2022 dividend after posting an operating loss of €724Mln as the termination of Kanye West partnership had a negative impact of €600Mln. For The group's CEO, "2023 will be a transition year to build the base for 2024 and 2025." 

 

 

 

 

 

 

 

 

 

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Look Ahead 9/3/23: Japan Q4 GDP; China CPI; Aviva , Pagegroup results

Growth and inflation figures from Japan and China provide trading opportunities. Plus, look out for earnings from Aviva. Pagegroup results to provide clues on global staff demand.

 

Angeline Ong | Presenter, Analyst and Content Editor, London | Publication date: Wednesday 08 March 2023

 

 

 

 

 

 

 

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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

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Today’s coverage:

Indices: Europe expected to open little changed, CAC just below record highs. Asia sees NKY new 8mth high as JPN economy narrowly voids recession

FX: Little or no reaction to Powell testimony day II. JPY up across the board, but only by a small margin, after GDP data  

Equities: Earnings – AV PAGE KIE ENT GAP ORCL. Silvergate goes into voluntary liquidation. PTON gets a ban on importing its video streaming services. UBER to IPO its freight unit? 

Commods: Gold and silver hold recent lows. Oil little moved after 2 days of losses 

 

 

 

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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

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Today’s coverage:

VIX climbs in one of the biggest moves to risk-off since June last year as cracks appear in the banking sector

Indices: Mkts down ahead of NFPs and banks dip as tech bank SVB suffers unprecedented withdrawals. Europe to open lower. INDU & SPX both down below their 200-day SMA. Banks lead the drop in Asia

FX: Watching all the major crosses today ahead of NFP at 1:30pmUK. Kuroda farewell at BoJ leaving rates on hold. UK data at 7am incl monthly GDP 

Equities: Tech specialist lender SVB down 60% as acct holders withdraw deposits. Big declines for JPM BAC C etc. Watch FTSE350 Bank sector today. ORCL down 5.6% last night after earnings failed to meet optimistic cloud forecasts 

Commods: Gold higher as a defensive play. Silver holds its recent drop. Oil down again in a negative week, but holds rising support, concerns about global demand rise 

 

 

 

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Early Morning Call: USD tanks after SVB collapse prompts US regulators, Fed to support banking system

Wall street and US 500 closed lower, 1.07% and 1.45% respectively, while the Nasdaq lost 1.76%.

 

 

 

 

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Charting the Markets: 13 March

FTSE 100, DAX and S&P 500 under pressure as banking crisis rocks markets. EUR/USD, EUR/GBP and USD/JPY mull over SVB collapse fallout. And gold, Brent crude and natural gas on the front foot amid SVB volatility.

Joshua Mahony | Senior Market Analyst, London | Publication date: Monday 13 March 2023

 

 

 

 

 

 

16 Candlestick Patterns Every Trader Should Know | IG US

 

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Early Morning Call: Dollar drops as markets no longer expect 50 bp hike from Fed; US CPI next

The collapse of Silicon Valley Bank and Signature Bank raised doubt as to whether the Fed will pursue its tightening policy next week.

Angeline Ong | Presenter, Analyst and Content Editor, London | Publication date: Tuesday 14 March 2023

 

Equity market overview

Europe equity markets fell heavily yesterday in the wake of the collapse of Silicon Valley Bank (SVB) and Signature Bank, despite attempts by regulators to reassure the markets.

The FTSE 100 dropped 2.58%, and the DAX by just over 3.04%. Banking stocks led the losses. The STOXX banking index fell 5.7%. In Germany, Commerzbank lost 12.7%, in Zurich, Credit Suisse fell 9.6% to a record low.

In the US, indices lost less ground, the Nasdaq even managed to end the session in positive territory. SVB financial fell another 63% yesterday. Some US regional bank stocks were severely hit yesterday. First Republic Bank lost 61%, Western Alliance Bancorp was down 47%, Zions Bancorporation -25%, PacWest Bancorp -21% to name a few.

Major banks also fell, but to a lesser extent. Bank of America fell 4.3%, Citigroup was down nearly 7%, Wells Fargo -5.8%, while JP Morgan 'only’ lost 1.35%. In total, major banks lost around $90 billion in stock market value, bringing their loss to $190bn during the last three sessions.

Two-year treasuries had their biggest rally since 1987 and the market priced out any chance of a 50-basis point (bp) hike at the Federal Reserve's (Fed) next meeting next week. Instead, Fed fund futures indicate a 70-basis point cut by year-end.

APAC indices

Likewise, indices were down in the APAC region. In Australia, Westpac consumer confidence remained at 78.5, holding near historical lows, as high inflation and rising interest rates continue to weigh on household budgets. NAB business confidence fell 10 points to -4 in February, erasing the bounce of last month. The survey paints a mixed picture. On one hand business conditions remain resilient with strong sales and employment, but here too, high inflation and rising interest rates had a very negative effect on the overall confidence.

US inflation data

The collapse of Silicon Valley Bank and Signature Bank raised doubt as to whether the Fed will pursue its tightening policy next week. Looking at Fed fund futures, a 50-basis point hike is now out of the question, but could the latest US inflation data shake things up again? US consumer price index (CPI) is expected to rise 6% in February year-on-year (YoY), decelerating from the 6.4% recorded in January. Core CPI is also forecast to ease, to 5.5% YoY, after 5.6% in January.

It follows Friday's jobs report which showed a still tight labour market, with over 300,000 job creations last month, but also indicated that wage inflation remained on a downward trend, down 0.2% month-on-month (MoM), the lowest increase in a year.

Equities

Elsewhere on the equity market, Close Brothers declared a statutory operating profit before tax of £11.7 million in the first half (H1) of its fiscal year, down from £128.9m in the same period a year ago, a performance mainly due to a provision of £114.6m in relation to the winding down of its loan business.

Old Mutual reported a 10% rise in full-year profit. The insurer, the largest life insurer in South Africa, said it benefitted from a drop in mortality claims in its biggest life insurance business. It nonetheless warned that the outlook remained risky for insurance firms in a context of rising interest rates and tough domestic economic conditions.

Volkswagen announced it will be investing €180bn in the next five years. Two thirds of that amount will be spent on electrification - including making batteries - and digitalisation in China, up from 56% in the previous five-year plan.

Credit Suisse fell to new record low yesterday, dropping another 9.6%. Earlier this morning the Swiss bank published its 2022 annual report. According to the document, customer "outflows had stabilised to much lower levels but had not yet reversed". Customers of the Swiss bank have been withdrawing funds in the fourth quarter following a string of scandals.

 

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This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

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Charting the Markets: 14 March

FTSE, DAX and Nasdaq expecting further volatility as US CPI release looms. Dollar weakness drives up EUR/USD and GBP/USD, while hitting USD/JPY. And Brent crude oil, gold and copper stall ahead of US CPI data release.

 

 

 

 

16 Candlestick Patterns Every Trader Should Know | IG US

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

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Look Ahead 15/3/23: BoJ minutes; China and US retail sales; Balfour Beatty

Minutes from the Bank of Japan’s last policy meeting and the latest retail sales print from the US and China are likely to add to the SVB-linked volatility. Plus, Balfour Beatty releases full-year results.

Angeline Ong | Presenter, Analyst and Content Editor, London | Publication date: Tuesday 14 March 2023

 

 

 

 

 

 

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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

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Today’s coverage:

Indices: Europe expected to start a little higher after gains yesterday in recovery mode after SVB collapse – technical analysis around indices still not looking good though

FX: Watching GBP as Chancellor delivers his budget ‘for growth’ (opposition to higher corp tax?). China mixed data as ind prod falls but retail sales recover

Equities: Earnings – PRU BBY HMB ADBE. BMW raises its EBIT margins fractionally  

Commods: Gold down for a second day but holding 1900. Oil sees a little bit of interest having broken to a new low for the year as OPEC upgrades China demand  

 

 

 

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Early Morning Call: European equity markets pursue their rebound as fears of banking crisis ease

Equity markets rebounded around the world as fears of a banking crisis eased.

 Jeremy Naylor | Analyst, London | Publication date: Wednesday 15 March 2023

Equity markets rebound

Equity markets rebounded around the world as fears of a banking crisis eased.

US regional banks that have been severely hit after Silicon Valley Bank (SVB) collapsed pared some of their losses in yesterday's session. First Republic Bank rose 27%, PacWest Bancorp 33%, and Western Alliance 14%.

Major US banks, all-session stocks on the IG platform, also rose yesterday: Wells Fargo ended the session up 5.1%, Citigroup 6%, JPMorgan, affected to a lesser extent in the previous days, rose 2.7%.

The US dollar seems to have found some support on the currency market. And gold has stabilised around the $1,900 mark.

Chinese data

In China, the latest data points to an uneven economic recovery. Industrial production rose 2.4% in the January-February period year-on-year (YoY), missing expectations for a 2.6% gain.

Retail sales rebounded after three months of decline. The index rose 3.5% in the first two months from a year before. The result was in line with analysts' expectations.

Fixed asset investment grew much faster in the first two months of the year, 5.5% higher than a year earlier, compared with a forecast of a 4.4% rise.

Spring budget

In the UK, the Chancellor of the Exchequer is due to present to the House of Commons his Spring budget at 12.30pm. Measures to be announced are intended to boost investment, and offset tax changes that will take effect next month. Jeremy Hunt has already said he will stick to his plan to increase corporation tax to 25%.

Job vacancies is another issue he wants to tackle. There are currently 1.1 million vacancies in the British labour market. Cost of living will also be addressed as fuel duty should be kept down, and the £2,500 energy price guarantee should be extended.

Across the Atlantic, US retail sales are expected to fall 0.3% in February month-on-month (MoM), and producer price index (PPI) is expected to rise 0.3% in February MoM, +5.4% YoY.

Elsewhere, Prudential said its operating profit rose 8% in 2022 to $3.38 billion. The result beat a forecast of around $3.34bn. The insurer has now completed the move of its entire senior management team from London to its new global headquarters in Hong Kong.

Balfour Beatty posted a full-year (FY) pretax profit of £287 million, and an 8% increase of its order book, giving the group more visibility in the short and medium terms.

In the US, investors await Adobe's quarterly earnings. Earnings are forecast at $3.68 per share and revenue at $4.62bn.

Commodities

OPEC has upgraded oil demand from China. It helped arrest a slide that saw oil prices hit new lows for the year.

Crude oil inventories increased by 1.15 million barrels last week according to the API, taking the rise to more than 56 million barrels so far this year.

Gasoline stocks fell by 4.59 million barrels and distillates by 2.89 million barrels.

 

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This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

 

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