Strong US jobs data revived the Federal Reserve (Fed) hawks on Friday. The US 10-year yield jumped, and the US dollar gained. Gold gave back a part of gains, and US stocks closed in the negative, although the three major US indices closed the first week of August in the positive.
Now, the S&P500 is nearing an important technical level near 4180 level, the peak reached in June, and the short-term direction will mostly depend on this week’s inflation data, due Wednesday.
Crude oil kicks off the week slightly upbeat, below the $90 level. News that China started mass testing in the Hainan beach resort comes as a warning that China is still not done with its fight against Covid.
Last week, OPEC increased the production outlook by a laughable, and a completely meaningless 100’000 barrels per day. That’s about 0.1% of the global oil output.
But the recession fears and the slowing demand will likely continue driving the market; we could see a further downside pressure on oil prices.
On corporate front, Coinbase, Disney, Honda, Coupang, and Rivian will be revealing their latest quarterly earnings.
On political front, the US Senate passed a landmark tax, climate and health-care bill, which includes tax credits for EV purchases & green energy incentives.
In cryptocurrencies, Ethereum prepares for its final test before the Merge update!
This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.
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