Facebook faces mass advertiser boycott
|With Independence Day observations on Friday, this week should be shortened one in US. But there are a number of important economic data that will be released before that, especially on Thursday. The key ones are the jobs report, durable goods, manufacturing activity and June inflation data. So there should be more volatility.
Globalization is clearly on the retreat with India banning TikTok and 59 other Chinese apps. US is ending many special privileges for HK and stopping exports of defence equipment and restricting dual - use tech to HK. To top it up Taiwan is looking to tighten investment rules for China which should really irk Beijing. We could be moving to a new world order in many areas of business.
The Dow got a major lift on the back of Boeing soaring higher but would stay clear of this script with many loose ends in the supply chain.
Facebook had a horrible day with it shares tumbling about 8% in a day. Out of its 8 million customers that advertise through FB about 150 opted out as they showed reservations in doing business with FB unless they are very clear about their policies relating to race. Everything is getting very political now. The exodus included many big-name accounts. The CEO of Coke summed up thus, “There is no place for racism in the world and there is no place for racism on social media”.
Equities
We were expecting further falls in the market yesterday, but it failed to fall. However, it does not change our overall views. The current corrections can take the S&P 500 to 3085 or slightly higher before it turns down again. We expect the next leg of the down move could be much stronger.
Bonds
There is nothing much to comment on bonds unless we resolve through the critical levels that we have mentioned before.
Euro
The Euro is all set for a significant move down and our critical level to hold on the top side is 1.1350.
Gold
The patterns in gold remains intact. A move above the Jun 24 high at 1780 is expected but it is not a must. A move below 1747 should give more confidence that the upside pressure could be over.
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