Dutch TTF July
22 gas futures soared above 93 Euros per 1 MWh, an important psychological
resistance level, and hit 95 Euros on Tuesday morning. This may indicate that
prices may surge further.
surged after European leaders agreed in principle to cut about 90% of oil
imports from Russia by the end of 2022 raising Brent crude prices above $120
per barrel. Gas is an alternate fuel and its prices followed oil quotes.
two major abilities. One is that it is traditionally considered to be a safe
haven asset that is in high demand during times of elevated risks in the
market, rising inflation, and geopolitical uncertainties. The second is that it
acts as an anti-dollar indication because gold prices mostly move in the
opposite direction to the Dollar. The Dollar itself has become a safe haven
asset in recent months as the Federal Reserve (Fed) has risen interest rates along
with Treasuries yields. So, gold prices are now more correlated with the
strong corporate reports seem to be trying to launch a counterattack against
the red sea of stock index losses. More than 150 companies from the S&P 500
broad market index have delivered their quarterly earnings reports, and more
than 80% of them beat consensus profit expectations of analyst polls.
some correction of the U.S. Dollar index from 101 to 100 points, more factors seem
to be pointing towards the further strengthening of the Greenback rather than
for its decline, and the recent drop may be rather distinguished as a
correction to the upward trend.
for a steeper angle of interest rate hikes by the Federal Reserve (Fed).
Investors are considering the 96% probability of a 50 basic point interest rate
hike from 0.5% to 1.0% to be announced the May 5 meeting.
In order to
understand the movement of EURUSD it is important to look at the inflation
rates in both the United States and in Europe. The Consumer price index (CPI) data
released for the Eurozone on Thursday also provides important economic input for
the movement of the currency pair to be explained.
The CPI for
Europe rose moderately in December to 5.0% year-on-year from 4.9% in November
compared to 7% in the United States for the same period. These figures show
that the pace at which prices rose in Europe was not so steep as in the U.S.
stocks are seen to be regaining their positions as one of the leading assets in
the tech sector this January. For the moment, the stocks – which make up one
fifth of FAANG - seem to have the
potential to face a mid-term upside.
Amazon has a largely
diversified business model which reaches far beyond its original e-commerce
profile. As Amazon holds 40%
of the e-commerce sector in revenue, this could look like a good launch pad for
a possible stock price take off as people became used to such ways of shopping
Dollar has been vulnerable to investors’ mood swings over the last few days.
The U.S. Dollar index (DXY) was breaking the limits in the beginning of the
week, but lost ground at 96.7 points as omicron-variant risks appeared to be milder
than previously expected.
The DXY index
fell to 96 points on Thursday despite positive developments in the U.S. economy
that grew by 2.3% year-on-year in Q3 2021 vs the expected 2.1%. Consumer
confidence in December rose to 115.8 points vs the expected 110.8 points and
the previous 111.9 points.
The second half
of October on Wall Street began with a moderate decline in average stock
prices, but the S&P 500 broad market index was kept within the same range
mostly above the 4,270-4,300 support area. Inflation worries were noticeable
ahead of a fresh U.S. consumer price index (CPI) which will be released today,
although it has already become clear that the Federal Reserve (Fed) has a
tendency to focus more attention on job targets and has a more "wait and
see" kind of approach when it comes to growing inflation.
In the middle
of the business week, the markets have still failed to form any stable trend.
Judging the overall situation on a conventional base of weighted average
instruments, such as the S&P 500 or the Euro Stoxx 50 indices, the several
hours of steady rebound when the market community was trying to buy fresh dips,
which were formed yesterday, were followed by a new day of sales again, and
Global economic growth
faced a serious sudden throttle with contradictory consequences, as high energy
prices were globally boosting inflation. Logically, low inflation was a serious
problem for economic growth in preCOVID-19 years, meaning low consumer and
investment demand hampered economic growth.
injections from the world’s major central banks, of which the Federal Reserve was
among the first to take action, reversed this trend to a large extent and
bailed countries out of economic turmoil.