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Charting the Markets: 15 March

FTSE 100, DAX 40 and S&P 500 mixed post Tuesday rally. Can the dollar regain lost ground across EUR/USD, GBP/USD and USD/JPY? And gold and lumber rally, but oil drops back.

 Joshua Mahony | Senior Market Analyst, London | Publication date: Wednesday 15 March 2023

 

 

 

 

 

 

 

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 to 16/3/23: ECB rates; Aussie jobs; ROO earnings

As indices sink analysts are expecting central banks to be more accommodative on rates but it seems the ECB will continue to deliver 50-basis points across the board. IGTV’s Jeremy Naylor looks at EUR/GBP.

In Australia AUD/USD could move on the unemployment data, while we’ll be looking at the Nikkei 225 on Japan trade.

Earnings include FY numbers at Deliveroo (ROO), Rentokil, and Savills.

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

 

 

 

 

 

 

 

 

[MongiIG]

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.

Today’s coverage:

Fears of a full-blown banking crisis grow pushing VIX up to levels last seen in late October 2022

Indices: Europe expected to open up after SNB supports CSGN – likely to be a short reprieve. Indices look like they may be on their way down to the Oct 2022 lows

FX: Brief flight to safety as USD benefits, but EURUSD the cross to watch – will ECB continue to go for 50bps rate rise today OR will current mkt sensitivities prevail? It’s inflation vs recession/crisis

Equities: Earnings – ROO RTO SVS. Last night ADBE climbed 4.7% on earnings

Commods: Brent below $75 for 1st time since Dec 2021 on recession fears. Copper near lows for 2023. Gold holds near recent highs, retaining its haven status  

 

 

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Early Morning Call: Credit Suisse emergency lifeline brings some market relief, but for how long?

There was some relief on the equity market this morning, after we learned overnight that Credit Suisse will be able to borrow up to ₣50 billion from the Swiss Central Bank.

 Jeremy Naylor | Analyst, London | Publication date: Thursday 16 March 2023 

Equity market overview

There was some relief on the equity market this morning, after we learned overnight that Credit Suisse will be able to borrow up to ₣50 billion from the Swiss Central Bank.

The Swiss lender's shares fell by as much as 30% yesterday, sparking a broader sell-off in European and US bank stocks. This latest announcement helped stem heavy selling on the Asian financial markets overnight.

In Europe, equity markets rebounded this morning after yesterday’s sell-off. The FTSE 100 closed 3.83% lower.

ECB

At 1.15pm, the European Central Bank (ECB) will deliver its decision on rates. Consensus hasn't changed in recent days. The main refinancing rate is still expected to rise by 50-basis points (bp) to 3.5%. Fifty bp is also still on the cards for the deposit facility rate and marginal lending rate expected respectively at 3% and 3.75%.

But some economists believe that central banks are walking on thin ice, and Christine Lagarde could decide to be more prudent. If she chooses to continue to fight inflation and maintain the pace of rate increases, she runs the risk of worsening the situation in the banking sector, where turmoil could become a full-blown crisis.

The Silicon Valley Bank (SVB) collapse last week sent shock waves through global financial markets. Yesterday, the Credit Suisse tumble was seen as an indication that containing the spill-over could prove even more difficult.

Macroeconomic indicators

A few macroeconomic indicators were published overnight.

Japan's trade deficit widened to ¥897bn in February year-on-year (YoY) as imports rose more than exports. Machinery orders, an indicator of investment in Japan as well as a leading indicator of manufacturing production, rose 9.5% in January compared to December 2022.

In Australia, the unemployment rate fell more than expected to 3.5% in February, from 3.7% the previous month.

In the US, investors await building permits and housing starts for February, the Philadelphia Fed manufacturing index for March and initial jobless claims. Economists anticipate 205,000 new claimants last week, after 211,000 the previous one.

Elsewhere on the equity market, Deliveroo confirmed it will deliver positive EBITDA this year after achieving a better-than-expected positive margin in the second half (H2) of 2022.

Savills believes that the first half (H1) of 2023 will be more difficult than H1 2022. The group posted an underlying pretax profit of £164 million, down 18%.

Expect Adobe to jump at the open later today in New York. The stock rose as much as 4.7% in extended trading last night after the company posted a better-than-expected set of earnings and raised its full-year (FY) targets. The maker of Photoshop posted earnings of $3.80 per share on revenue of $4.66bn. Adobe now expects fiscal 2023 profit per share target of between $15.30 and $15.60 versus $15.15-$15.45 forecast earlier.

As for the current quarter, Adobe sees second quarter (Q2) revenue of between $4.75nn-$4.78bn and profit per share of $3.75-$3.80, both largely above Wall Street expectations.

 

 

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 to 17/3/23: US industrial production; oil rig count data

With corporates mostly out of the frame, certainly as far as scheduled news is concerned, the markets may be able to have a quieter end to the week.

IGTV’s Jeremy Naylor pulls two pieces of data to watch: US industrial production numbers and the weekly Baker Hughes rig count.

Jeremy Naylor | Analyst, London | Publication date: Thursday 16 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.

Today’s coverage:

VIX coming off the biggest one day drop since May 2022 as established banks deliver support lines to troubled lenders with traders waiting to see if a full blown banking crisis has been averted 

Indices: Europe broadly holding Thursday’s gains, but expected to end the week down heavily. 

FX: USD down for 2nd day as economists now believe Fed 15% chance of NO rate move next week and 85% chance of 25bps

Equities: FRC receives $30bln lifeline from US banks to stave off collapse. FDX up 11% last night after raising 2023 targets  

Commods: Gold holding Thursday’s gains set for biggest weekly gain since November. Oil holds weekly lows on continued demand concerns around the increased potential for recession. Bitcoin breaks 25,240 resistance 

 

 

 

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Early Morning Call: European indices open higher after First Republic Bank rescue

US markets posted solid gains yesterday, after major US banks pledged to shore up First Republic Bank.

 Jeremy Naylor | Analyst, London | Publication date: Friday 17 March 2023 

US markets

US markets posted solid gains yesterday, after major US banks pledged to shore up First Republic Bank. Tech stocks benefitted the most, with the Nasdaq composite rising 2.5%.

Hours after Credit Suisse's announcement of a Swiss National Bank (SNB) emergency lifeline to up to CHF50 billion, large US banks injected $30 billion in deposits into First Republic Bank yesterday afternoon. Once confirmed, First Republic Bank reversed a 36% drop, and ended the session up 10. But expect the stock to drop at the open on Friday afternoon.

Shares fell 18% in after-market trading, after the bank said it would suspend its dividend. Is the banking sector facing a liquidity crisis? For the time being, policymakers are saying no, emphasising that the current turmoil is different to the 2008 financial crisis. That said, data yesterday showed the US banks sought record amounts of emergency liquidity from the Federal Reserve (Fed) in recent days. Banks have borrowed $164.8bn from Fed facilities in the week to 15 March.

Cental banks

Yesterday, the European Central Bank (ECB) decided to stick with its own aggressive rate hike, raising its main refinancing rate by 50-basis points (bp) to 3.5%. Christine Lagarde couldn't say it more clearly: the ECB is not waning on its commitment to fighting inflation.

Next Wednesday, it will be the US Federal Reserve's turn to decide on rates. Like the ECB, economists believe the Fed will adopt a 'dual track' policy approach, distinguishing monetary policy from macro-prudential policy. US central bankers are continuing with their fight against inflation with a 25-basis point hike, which would bring the Fed's benchmark rate to a 4.75%-5% range.

Expectations of a 50-basis point increase are now gone. A week ago, Fed chair, Jerome Powell signalled he was ready to hike faster if data supported the need. Fed funds futures now show a probability of a pause of about 14%.

This afternoon at 12.30pm, industrial production is expected to rise by 0.2% in February month-on-month (MoM). A bit later at 2pm, Michigan consumer sentiment is forecast to remain unchanged at 67 in March.

Equities

Elsewhere on the equity market, FedEx raised its fiscal 2023 profit forecast yesterday evening after the US closing bell, citing progress on its cost-cutting plan. The news sent shares up more that 11% in extended trading. Adjusted earnings came in at $3.41 per share in the third quarter (Q3). That's down $1.18 on Q3 a year ago, 65 cents higher than analysts' average estimate. Revenue fell 6% to $22.2 billion, missing Wall Street forecasts.

Despite weak market conditions, FedEx now forecasts adjusted profit of $14.60 to $15.20 per share for the full year, up from its previous projection of $13 to $14 and well above analysts' average estimate of $13.56.

Commodities

On the commodity market, oil prices are rising this morning, but are set to post their largest weekly loss this year.

Oil traders await the Baker Hughes oil rig count. Last week, the survey showed a drop in total rig counts to 746 from 749 the previous week. The number of oil rigs in operation fell by two to 590.

Gold remains near recent highs. The precious metal is set to post a third straight week of gains and is poised for its best week since mid-November.

 

 

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.

[MongiIG]

Charting the Markets: 17 March

FTSE 100, DAX 40 and Nasdaq 100 recover, the latter even on track for a bullish weekly close. And gold and oil recover, but cotton prices drop.

Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Friday 17 March 2023

 

 

 

 

 

 

 

 

 

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.

[MongiIG]

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.

Today’s coverage:

Indices: Europe expected to open a touch lower after Wall St turned round. Initially rising on the light touch statement from the Fed, but that was washed away by Powell in the presser saying that he remains focused in on beating inflation 

FX: Todays currency to watch is GBP vs all-comers ahead of the BoE rate decision. Yesterday DXY fell to levels not seen since the beginning of Feb - seemingly not concerned about the later words from Powell on inflation  

Equities: COIN down 22% after it rec’d a Wells enforcement notice from SEC. Earnings today – WIX

Commods: Gold took heart from a falling dollar. Oil up for a 4th day today 

 

 

 

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Early Morning Call: BoE to follow Fed and raise rates?

As expected, the US Federal Reserve (Fed) raised its rates by 25-basis points (bp) to a new target range of between 4.75% and 5%, the highest level since 2007.

 Jeremy Naylor | Analyst, London | Publication date: Thursday 23 March 2023

Fed rate hike

As expected, the US Federal Reserve (Fed) raised its rates by 25-basis points (bp) to a new target range of between 4.75% and 5%, the highest level since 2007.

The US dollar fell to a seven-week low as the US central bank sent the signal that it is nearly done with the most aggressive streak of rate rises in decades. Members of its policy-setting committee removed the oft-repeated warning that "ongoing increases" would be necessary. Instead, the committee said "some additional policy firming may be appropriate" to bring inflation back to the bank's 2% target.

Wall Street and the Nasdaq ended the session around 1.6% lower, while gold regained most of the ground it lost earlier in the week.

BoE

The Bank of England (BoE) meanwhile makes its decision on rates at 12pm today, but the picture has been complicated by Wednesday's unexpectedly strong inflation print. Markets now appear to be pricing in a quarter-point rise, a response to headline consumer prices rising at their fastest rate in 45 years.

One factor that will weigh in favour of rates staying the same is that some of the inflation was due to one-off factors such as the weather-related shortages of fresh fruit and vegetables. This led to empty shelves in UK supermarkets and helped drive up prices of food and non-alcoholic drinks at their fastest pace in more than a generation.

Also today, the market awaits US initial jobless claims and eurozone’s consumer confidence flash for the month of March.

Equities

Elsewhere on the equity market, Wickes reported a 11.3% fall in pretax profit and said trading in the first 11 weeks of 2023 was in line with expectations.

In the US, Accenture and General Mills are due to report quarterly earnings.

Coinbase, an all-session stock on the IG platform, fell more than 22% after it was issued a Wells notice by the Securities and Exchange Commission (SEC). A Wells notice is often one of the final steps before the SEC formally issues charges, generally laying out the framework of what happens next.

CNBC says that "based on discussions with the staff, the potential enforcement actions would relate to aspects of the company's spot market, staking service Coinbase Earn, Coinbase Prime and Coinbase Wallet".

Commodities

On the commodity market, oil prices fell slightly after the Fed comments, but WTI and Brent remained above $70 and $75 respectively.

Prior to the Fed decision, oil prices rose as US crude oil stockpiles rose unexpectedly last week to their highest in nearly two years, according to the EIA. Crude inventories rose by 1.1 million barrels last week, their highest since May 2021. Expectations were for a 1.6-million-barrel drop.

Gasoline stocks fell by 6.4 million barrels, and distillate stockpiles fell by 3.3 million barrels.

 

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.

[MongiIG]

Look Ahead 24/03/23: Japan CPI; PMIs; UK Consumer; JD Wetherspoon results

Growth swings back to the fore as traders watch out for inflation data out of Japan; PMIs; plus consumer confidence and retail sales numbers from Britain. British pub group JD Wetherspoon reports earnings.

Angeline Ong | Presenter, Analyst and Content Editor, London | Publication date: Thursday 23 March 2023 

 

 

 

 

 

 

[MongiIG]

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.

Today’s coverage:

Indices: Small losses at the start expected in Europe although all mkts expected to end the week up

FX: USD holding the weekly lows. Japan CPI has taken JPY up against most currencies after Japan CPI data. GBPUSD holds recent gains after UK Gfk consumer confidence at 1yr high awaiting UK retail sales  

Equities: Earnings from JDW SMIN. TUI has announced a €1.8B capital increase

Commods: Gold nearing $2000 again after breaking briefly over that level twice this week, benefitting from weak USD. Base metals mostly higher. Oil holding the week’s gains 

 

 

 

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Early Morning Call: FTSE 100 opens lower as UK consumer confidence shows persisting financial gloom

While consumer confidence rose, it showed no improvement in its gauge of personal finances.

 Jeremy Naylor | Analyst, London | Publication date: Friday 24 March 2023 

Consumer confidence, CPI

UK consumer confidence rose this month to its highest level since March last year.

GfK's consumer confidence index rose to -36 in March, in line with expectations, up from -38 in February. Still, the GfK survey showed no improvement in its gauges of personal finances.

In the Gfk statement, client strategy director Joe Staton underlined that "a small improvement in the overall index score this month masks continuing concerns among consumers about their personal financial situation. Wages are not keeping up with rising prices and the cost-of-living crisis remains a stark reality for most".

Last month UK consumer price index (CPI) unexpectedly rose 10.4% year-on-year (YoY). UK retail sales rose more than expected in February, by 1.2% month-on-month (MoM). Economists anticipated a 0.2% gain. Compared to February 2022, the index declined 3.5%.

In Japan, the yen strengthened after the headline consumer price index rose by 3.3% in February, decelerating from January's 41-year high of 4.3%. The latest figure also marked the lowest print since last September.

Core CPI, which excludes fresh food but includes fuel costs, also decelerated sharply in February, showing a 3.1% increase. But the so called "core-core" index, which strips away food and energy costs, hit a four-decade high, rising 3.5% YoY, after 3.2% the previous month. This is the index the Bank of Japan (BoJ) takes into consideration when it makes its decision on rates. This index is now exceeding the Bank of Japan's 2% target for a fifth straight month.

PMI

It is PMI day today in Europe and the US, where S&P global manufacturing PMIs are expected to remain below 50 in March.

In Japan, manufacturing activity contracted for a fifth straight month in March. The Jibun Bank manufacturing PMI rose to a seasonally adjusted 48.6 in March, from a final 47.7 in the previous month.

Equities

Elsewhere on the equity market, JD Wetherspoon returned to half-year (H1) profit. The British pub chain reported a profit of £4.6 million for the six months ended 31 December, compared with a loss in the same period a year ago.

Watch out for Smiths Group at the open. The industrial technology company posted a 27% jump in first-half profit and upgraded its forecast for the full-year (FY).

TUI announced the launch of a €1.8 billion capital increase for the repayment of state to strengthen its balance sheet. 328.9 million new ordinary shares will be offered at €5.55 a piece.

Commodities

On the commodity market, oil prices are little changed this Friday. Investors now await Baker Hughes data. Last week, total rig count rose to 754 from 746 on the previous one. The number of oil rigs in operation however decreased by one to 589.

Industrial metals have benefitted from the weakness of the dollar. Copper has risen to a three-week high. Aluminium and zinc also recorded gains.

 

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.

[MongiIG]

Charting the Markets: 24 March

The FTSE 100, DAX 40 and Nasdaq 100 slide on renewed banking woes while EUR/USD, EUR/GBP and GBP/USD drop as the US dollar, gold appreciate due to flight-to-quality flows. Crude oil and copper tumble on recession fears.

 Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Friday 24 March 2023

 

 

 

 

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.