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Erik Schafhauser Zürich

Morning Brew August 27 2024

Morning Brew 1 minute to read
Erik
Erik Schafhauser

Senior Relationship Manager

Summary:  Nerves ahead of Nvidia

Good morning,

Markets are showing some nerves in an unclear picture:

The situation in the middle east remains explosive and the fighting in Ukraine intense! The German IFO came worse than feared, US Durable goods were better than expected, PDD (Parent to Temu) loses 55 billion in value after a disappointing results and outlook, Chinese industrial profits are strong and the Japanese PPI low. Canada announced tariffs of 100% on Chinese EV.

Volumes were again fairly low at below 10 billion shares on US Exchanges, Nasdaq and S&P lose 0.3 and 0.85% while the Dow Jones remained green at 0.16%, The Dow hit an Intraday High yesterday. Nvidia-traders showed some nerves, letting the stock drop 2.25%, Tesla was affected by the Canadian tariffs on Chinese Electrical Vehicles, as retaliatory measures are expected. In Switzerland Meyer Burger took another beating as the company announced a further restructuring, the stock lost 45% yesterday

Looking at Equities, Nvidia`s earnings are the elephant in the room, all eyes are on the release, so far, this year the stock is up 150% year to date and has added 1.8 trillion USD in market cap. The report tomorrow is seen as a key health indicator for the AI market. Reuters stated: Nvidia sales likely doubled - even that may not impress investors. Consider your risks here and consider how much you want to carry into the data release.

US Yields rose a little yesterday and pulled the USD Index to 100.85, EURUSD is 1.1166, GBPUSD 1.3195 and USDJPY 144.70. Gold and Silver are 2509 and 29.95, the Dollar remains near support levels.

Oil rose yesterday on worries of an escalation in the middle east , Sugar is rising as wildfires affect brasil, rising 4% yesterday.

Today the economic calendar is fairly thin and I expect nervous trading ahead of the Nvidia earnings. We often hear one should not pay too much attention to a single company result but to put things into perspective, the strongest move Nvidia had recently after a release was 24% move, at 3 trillion in Market cap, such a move would add or wipe out 720 billion in market cap. That is more than half the German Dax.

John put out the second edition of the US election outlook:

The Weekly US Election Countdown for Investors

Days to election day: 71
As of Monday, August 26, 2024

The polls:
This week: Trump: 43.7%  Harris: 47.2%   (Harris leads polls by +3.6%)
1-Week Ago:  Trump: 43.8% Harris: 46.7%   (Harris led by +2.9%)
(based on poll aggregation snapshot from fivethirtyeight.com*)

Latest PredictIt** odds: Trump: 48  Harris: 56

This week: Nvidia earnings and US economic data far more in focus than the election

Tuesday
- Data Japan PPI, Germany GDP, US Consumer confidence,
- Earnings: BHP, Bank of Montreal, Bank of Nova Scotia
- Speakers:
Wednesday
- Data AU CPI,
- Earnings: CNOOC, BYD, Meituan, , Bank of Communications Royal Bank of Canada NVIDIA Corp Salesforce Crowdstrike

Speakers: Christoph Waller

Thursday
- Data Consumer Confidence, Germany Inflation, US GDP, Initial Jobless claims.
- Earnings Bank of China China Merchants Bank China Life Insurance Canadian Imperial Bank Dell Technologies, Marvell Technology Autodesk
Speakers: Raaphael Bostic
Friday
- Data Japan CPI (Tokyo) AU retail Sales, CH KOF Indicator, DE Unemployment, EU HICP, US PCE, Canada GDP, University of Michigan

Expiries:

Physically Settled Futures

FLGU4 will expire on 28/aug 1500 hrs

NGU4 will expire on 27/aug 1930 hrs

QGU4 will expire on 27/aug 1830 hrs

TTFMU4 will expire on 28/aug 0900 hrs

QIU4 will expire on 28/aug 1725 hrs

QGU4 will expire on 27/aug 1830 hrs

MHGU4 will expire on 28/aug 1500 hrs

HRCQ4 will expire on 27/aug 1730 hrs

 

Expiring CFDs

 

10YUSTNOTESEP24 will expire on 28/aug 1500 hrs

30YUSTBONDSEP24 will expire on 28/aug 1500 hrs

COPPERUSSEP24 will expire on 28/aug 1500 hrs

CORNSEP24 will expire on 28/aug 1500 hrs

GASOLINEUSSEP24 will expire on 28/aug 1500 hrs

HEATINGOILSEP24 will expire on 28/aug 1500 hrs

SILVERSEP24 will expire on 28/aug 1500 hrs

SOYBEANMEALSEP24 will expire on 28/aug 1500 hrs

SOYBEANOILSEP24 will expire on 28/aug 1500 hrs

SOYBEANSSEP24 will expire on 28/aug 1500 hrs

WHEATSEP24 will expire on 28/aug 1500 hrs

 

 

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