Dollar index (DXY) June futures slid under the lowest levels since March 18,
reaching as deep as 91.65 points mark today. The soft landing of the Greenback
continues step by step almost every day during the last two weeks. That
intermediary result is in no way, of course, summarizing a long discussion on
the ability of higher Treasury's yields to make the Dollar more attractive in
principle. But it may leave the whole conception in serious doubt, at least.
California-based trending producer of electric vehicles, Tesla officially
reported its record 2021 first quarter deliveries at the very end of last week.
Despite the ongoing worldwide shortage of semiconductor components, which was recently
seen to be one of the reasons for the correction of Tesla shares down to
$597.95 per share, demand for the advanced Model Y of the automaker has
remained high since mid-January, especially from China and other Asian
any dips" general strategy still seems to pay its way. It works very well
on both American and European stocks except, maybe, for some of the long-suffering
big techs. The U.S. S&P500 broad market index is testing highs above 3950
again, while the Euro Stoxx 50 and the German Xetra Dax30 composite already
succeeded in hitting their all-time records this week. It looks like almost
every bit of the market is ready for an upbeat rally extension at least for the
first half of April.
The U.S. Dollar is unlikely to have a big cause for a noticeable strengthening across the whole of the spectrum of the world's major currencies, since unordinary spikes in 10-year Treasury bond yields up to the annual level of 1.75% have calmed down for a while to reach 1.6% during the Asian trading hours today. This happened despite the Federal Reserve's inaction and against growing inflation expectations. Nevertheless, some of the Greenback's competing currencies have found their own reasons to decline.
As the U.S. inflation data indicated as much as 2.8% of growth in the producer price index (PPI) last Friday, which is the highest value since November 2018, some part of the market seem to be mystified by the possible backlash by the Federal Reserve (Fed) at its latest regular meeting. The results of Fed's own monetary policy's audit will be represented to the market at 18.00 GMT, and the press conference with the U.S. regulator's Chairman Jerome Powell will follow half an hour later.
This possible increase in inflation could be due to the intense work of the U.S.
Brent oil prices spiked above $71/bbl in early Asian hours on Monday, March 8. The factor that played a role in this outcome is most probably fears around supply disruption from Saudi Arabia, after another combined drone and missile attack on some of its facilities by Yemen-based forces over the weekend. After these fears quickly faded, quotes were seen to go back to normal within the next two working days and now more adequate levels below $68/bbl can be seen. The morning low in European time on Wednesday was near $66.7/bbl, where the oil market found at least an intraday support.
As China's industrial activity data failed to inspire the investment community at the beginning of the week, with the Manufacturing Purchasing Managers Index (PMI) at 50.6 only against the estimated 51.1 level by the average Reuters poll's forecast and after topping at 52.1 peak in November 2020, a similar set of indicators in the EU were much more pleasant in market's eyes. Therefore, the European stock indexes have got a real chance to grow faster than their Asian and American competitors, attracting potentially more capital inflows into portfolios consisting of Old World's companies.
Some arcade-type episodes of corrective price adjustments on big tech giants like Amazon and Netflix are targeted but local sell-offs on some particular retail assets looks more like the result or sum of money management efforts taken by the market crowd. Individual investors and funds are trying to do it in a smart way by shedding particular shares which they have decided are too expensive to hold.
The stocks of Walmart Inc, which is the biggest retail corporation in North America, are nervously awaiting for tomorrow's Q4 earnings report. Its revenue and equity per share (EPS) figures are scheduled to be released before the Wall Street's open on Thursday, February 18, as well as the CEO's letter containing the forward guidance on the company's business plan and prospects for the rest of the year. Walmart operates a chain of budget hypermarkets, discount department and grocery stores with a very simple motto “Save Money, Live Better”.
The U.S. stock market is closed this Monday because of Presidents' Day, while the whole of China celebrates its Lunar New Year vacations. By the way, the Year of the Metal Ox or Bull begun on February 12. The Chinese hieroglyphic symbol 牛 is attributed to the very same Bull, and it is pronounced similar to "niu" in English transliteration, which in turn sounds similar to "new". Even the intonation of the sound is phonetically similar to the ascending tone of the word "new" in the "new year" combination.