I dag er det Saxo Bank, der skriver om den negative stemning i markedet på baggrund af nye advarsler om en lavere vækst end ventet. Aktier i en stribe sektorer er på vej ned, mens centralbankerne sætter renten i vejret, og OECB har sænket sin globale prognose for væksten i år fra 4,5 til 3 pct.
Caution is thick in the air, and another growth warning
Summary: Global banks, property and the consumer discretionary sectors look susceptible to further carnage with central banks joining the aggressively hike party, with the ECB decision next. Given inflation is at records and set to continue to march up, how much more damage can be done? Meanwhile, Crude oil jumps to a 13-week high and is supported higher on expectations China’s oil demand will rise, and US and European travel will pick up this summer while supply concerns linger on. Plus why the US equity rally from May could reverse, and the Chinese bear market rally could also wane. We share the stocks and ETFS to watch in Uranium and Hydrogen as the world attempts to play catch up with climate change.
What’s happening in markets that you need to know?
US stocks back pedal with caution thick in the air, ahead of Fridays US inflation data , next weeks’ Fed meeting and shortly after that we will get more updates ahead of Q2 earnings, (likely to be lackluster excluding commodities).On Wednesday The Nasdaq 100 (USNAS100.I) fell 0.7%, and the S&P 500 (US500.I)lost 1.1% with the technical indicators looking bearish suggesting the market could fall further and give back some of the gains made from the rally since May 20.
Hong Kong and Chinese equities’ rally takes a pause this morning. In earning trading, Hang Seng Index (HSI.I) and CSI300(000300.I) fluctuated between modest gains and losses. After impressive session yesterday in Hong Kong and ADR trading in New York, Chinese technology also gave back some of the gains. Hang Seng TECH Index(HSTECH.I) was little changed. Bilibili (09626) fell 4% ahead of reporting results later today.
AUDUSD looks bearish and is likely to give back some fresh gains as the US dollar index rallies up on uncertainty rising. We have observed some Saxo clients placing short on the AUDUSD ahead of Friday US inflation data and the Fed starting its balance sheet reduction at next weeks meeting. For a look at the technical indicators, click here. Click for an update on other currencies
What to consider?
Another global growth warning. The OECD also slashed its global growth outlook for 2022 to 3% from 4.5% earlier in December. The comments that the world economy will pay a “hefty price” for the Ukraine war and the impact on supply chains would be long lasting were risk-negative especially as the inflation outlook has also doubled to almost 9% for its 38 member states.
Supply/demand imbalance in Crude oil (OILUKAUG22 & OILUSJUL22) continues. UAE Energy Minister said the situation is not encouraging when it comes to the amount of crude OPEC+ can bring to the market and noted that conformity with the OPEC+ deal is more than 200%. He also said that prices are “nowhere near peak” and China reopening is likely to further aid demand pressures. US EIA weekly crude stocks declined for a 10th straight week.
China’s May passenger vehicle retail sales fell 17% YoY but grew 30% MoM. Whole sales were down 3% YoY but grew 64% MoM. China is scheduled to release May trade data later this morning and aggregate financing data as early as today.
ECB meeting on tap today. The European Central Bank (ECB) is scheduled to meet today. While expectations are broadly set for a lift-off in July, eyes will be mainly on the Bank’s inflation forecasts and any hints of an earlier-than-expected 50bps rate hike moves. For in depth analysis, click here. Recall May CPI rose to a fresh record high of 8.1% y/y from 7.5% y/y previously, and ECB tightening expectations have picked up since this economic read. We expect more of the policymakers to tilt hawkish in the coming weeks, which will likely bring forward the expectation of the 50bps move to Q3 rather than in December.
