Quarterly Outlook
Macro outlook: Trump 2.0: Can the US have its cake and eat it, too?
John J. Hardy
Global Head of Trader Strategy
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Morning Brew August 25 2022
Erik Schafhauser
Senior Relationship Manager
Summary: Calm ahead of Jackson Hole
Good Morning,
Looking at the topline indexes the market seems to be fairly quiet but her is lots going on:
US Indexes rise less than 0.5% yesterday and continue to add over night, the GER40 is now at 13265, the US 500 4156 and the US tech 100 12961.
Tesla will book the 3:1 split before the open and trade at app 298.
US Yields remain above 3% for the 10 Year, the USD Index falls to near 108, EURUSD rises to near parity, GBPUSD 1.1835 and Gold and Silver 1757 and 19.35. Bitcoin is unchanged at 21500.
Snowflake raises its outlook for 2023 and gains 18% in the aftermarket, Salesforce cut the outlook and shares fall 7% after hours. Nvidia Corp results were basically in line with expectations but the outlook was worse than expected for Q3 on a weaker gaming industry, the stock falls app 5%
The U.S. government will forgive $10,000 in student loans for millions of college students making less than 125k p.A. ahead of the important mid-Term elections.
German GDP came stronger than feared at 1.8% annually rather than 1.5% expected.
US crude oil stockpiles fell, with commercial inventories down 3.3m bbl last week, causing oil to trade higher, Brent is above 101 USD.
Softs are rising again, Coffee is testing resistance and European Wheat (EBMZ2) broke the 200d MA again.
The expectation for the next FOMC meeting has shifted to 60% probability for a 75 BPS Hike.
Both traders and investors focus on the Jackson Hole speech by Powell tomorrow and also unscheduled comments by other central bankers
The overall sentiment seems to be that Powell will try to appease the market – at least judging by the fact that risk sentiment seems to get stronger despite rising rates.
Economic Data:
Today: German GDP, IFO, US GDP,
Friday: US GDP, Powell Speaks at Jackson Hole
Earnings.
Today: VMware Inc
Friday: Industrial Bank
Expiries
Physically Settled Futures:
Henry Hub Natural Gas (NGU2) will expire 26th Aug at 19:30 GMT
10 Year Government of Canada Bond (CGBU2) will expire 29th Aug at 15:00 GMT
Long Gilt (FLGU2) will expire 29th Aug at 15:00 GMT
Dutch TTF Gas (TTFMU2) will expire 29th Aug at 9:00 GMT
Expiring CFDs:
10YUSTNOTESEP22, COPPERUSSEP22, CORNSEP22, GASOLINEUSSEP22, HEATINGOILSEP22, SILVERSEP22, SOYBEANOILSEP22, SOYBEANSSEP22, WHEATSEP22 will expire 29th Aug at 15:00 GMT
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