STOCK PRICES AND NEWS
Intel stock slumps 12% on lowered forward guidance Premium
Intel stock is sliding on Friday after issuing Q1 guidance that harshly underperforms Wall Street consensus. The legacy chipmaker said that it expects to narrowly break even on earnings per share and take in revenue that arrives $360 million below the latest Wall Street consensus.
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US EQUITY INDICES
The Dow Jones Industrial Average (DJIA) is a price-weighted average of 30 most-traded stocks traded in the United States (US). It is often viewed as representative of “old economy” stocks and is considered a leading indicator for international investment.
While the Dow reflects the big money, the Standard and Poor’s 500 (S&P 500) is often the preferred gauge of equity markets due to its broad market coverage. The S&P 500 is a market value-weighted index comprising 500 large US stocks, covering about 75% of the US equity market.
The Nasdaq Composite is highly followed in the US as a performance indicator for technology and growth companies. The Nasdaq-100, which includes 100 of the largest non-financial companies in the Nasdaq Composite, accounts for about 80% of the index weighting of the Nasdaq Composite. The Nasdaq Composite is a capitalization-weighted index and it includes both US and non-US companies listed on the Nasdaq stock market. The NASDAQ represents the speculative retail money.
Generally speaking, a rise in the US equity markets tends to increase investors' risk appetite attracting foreign investment to the US equity market and pumping the US Dollar (USD) higher.
EUROPEAN EQUITY INDICES
Germany DAX - Daily
UK FTSE 100 - Daily
The DAX is a stock market index consisting of the 40 major German blue chip companies trading on the Frankfurt Stock Exchange. It is a total return index and prices are taken from the Xetra trading venue.
The Financial Times Stock Exchange 100 (FTSE 100), informally known as the “Footsie”, is a market capitalization-weighted index representing the top 100 blue-chip companies on the London Stock Exchange. The index represents over 80% of the total market capitalization in the United Kingdom (UK). Stocks in the FTSE 100 are free-float weighted, ensuring that only the investable opportunity set is included in the index.
JAPANESE EQUITY INDICES
The Nikkei 225, commonly called the Nikkei, is a stock market index for the Tokyo Stock Exchange (TSE). It is a price-weighted index, operating in Japanese Yen (JPY), that measures the performance of 225 highly capitalized and liquid publicly owned companies in Japan. It has been calculated daily by the Nihon Keizai Shimbun (Nikkei) newspaper since 1970.
Nikkei225 - Daily
Relationships between stocks and currencies
Currencies are probably the most difficult asset class to fit into a consistent intermarket model. For instance, when investors purchase stocks from a particular country, they must pay in the local currency, increasing the demand for that currency. Conversely, a strong currency can make bonds and stocks more attractive to foreign investors.
However, the correlation between stocks and currencies is not always clear. There are often response lags between the reactions of Forex and equities markets, leaving investors holding foreign equities exposed to exchange rate fluctuations.
This correlation is also fragile among international equity markets. The so-called global divergences occur when the stock market in one country starts performing better than the stock market in another country. This is often driven by currency capital flows from the country with the weaker stock market to the country with the stronger one.
US Dollar Index - Daily
Latest STOCK INDICES Analysis
Editors' picks
Gold picks up pace, approaches $5,000
Gold prices keep their uptrend well in place and gear up for an imminent hit to the key $5,000 mark per troy ounce on Friday. The yellow metal’s sharp advance gathers pace amid the increasing weakness in the US Dollar and mixed US Treasury yields across the curve.
EUR/USD: Trump gives it, Trump takes it away Premium
Once again, geopolitical woes were at the top of the list of market movers, and the outcome was not good for the US Dollar (USD). The Greenback was hit by uncertainty triggered by United States (US) President Donald Trump’s decisions.
GBP/USD: Pound Sterling surges above 1.3500 against weakened US Dollar Premium
GBP/USD started the week on a firm footing and continued to trade strongly as disputes between the United States (US) and the European Union (EU) over the purchase of Greenland battered the US Dollar (USD) significantly.
Bitcoin: BTC slips below $90,000 as Trump's tariffs swing, ETF outflows pressure price
Bitcoin (BTC) is trading below $90,000 at the time of writing on Friday, down nearly 5% this week. Despite a brief improvement in risk appetite following US President Donald Trump’s mid-week speech at Davos, the Crypto King remains under pressure as institutional demand continued to weaken so far this week.
Week ahead – Fed and BoC meet amid geopolitical upheaval and Trump’s Fed pick
Fed to likely go on pause after three straight cuts. BoC is also expected to stand pat. But will Trump steal the limelight by revealing his Fed chair nomination? Eurozone GDP and Australian and Tokyo CPI to be watched too.