Market Insights Today: More tech pain, Oil nears $88, BOC pivots, AUD and Kiwi rally as USD falls– Oct 27, 2022

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Google-parent- Alphabet, Microsoft Corp and semiconductor giant Texas Instruments Inc., reported weaker than expected results, triggering a sell off, wiping off more than $400 billion in market value off some of the biggest US companies. The Bank of Canada (BOC) made a surprisingly dovish hike, pushing the US 10-year yields down 9 bps to 4.01%. That pressured the US dollar, with the Aussie and kiwi leading the G-10 basket higher. Oil continued to move up, rising 3.5%, which supported oil and gas stocks higher, while gold rose 0.8% to a two week-peak. And US-listed Chinese stocks rallied again, erasing most of Monday's record selloff; while most Asian-Pacific equity futures are higher with China and Australia’s markets tipped to rise the most.

Meta plummets 18% in late trading after its fourth-quarter revenue forecast disappointed

...amid the ongoing ad market slowdown. Meta also expects higher expenses in 2023 as it pursues its ambitious, but costly, metaverse vision, saying operating losses will grow "significantly" year over year. "Prioritization and efficiency" are Meta's focus now, said Mark Zuckerberg, with some teams being downsized, and only priority teams getting to grow headcount.

Australia’s ASX200 (ASXSP200.1) posed to rise 0.4%, supported by the falling USD, rising commodity prices

On Thursday morning the S&P/ASX 200 futures suggest the market will lift 0.38% supported higher by oil prices rising over 3% to $88. Attention will be on Woodside, Santos, WorleyParsons and the like. Lots of quarterly results are on tap; with a focus on rare-earth giant Lynas, and iron ore major Fortescue, as well as gold miners Newcrest Mining, Gold Road Resources and Regis who also report results today. And in the thick of it, ANZ reports yearly results. Investors should pay attention to its net interest margin (a term that measures banking profitability). We think it will decline, given borrowing rates are declining and bad debts are rising. Markets will also pay attention to iron ore results from Fortescue Metals today, especially after China affirmed its zero-covid policy stance. As such the outlook for iron ore majors like FMG, BHP, Rio and Champion Iron might be downgraded by research houses.