Week to Jan 24th

Coronavirus scare dominates, Worst week for five months, BoC dovish

Mon Jan 20

US markets were closed today, and volatility was light elsewhere, with DAX making small gains, but FTSE and GBP falling on remarks by the UK Chancellor Javid that the UK would not adhere to EU standards after leaving next week. Forex was also fairly quiet, a small move up in CAD led to a flat dollar overall. Gold and Bonds were slightly up, and Oil was down, following the UK mood.

Tuesday January 21

Asian markets fell on the Chinese coronavirus scare, and this mood was reflected in Europe and the US, with all markets down, although a late recovery meant SPX was flat, and NDX up. Nevertheless, DAX briefly hit an all-time high before pulling back. Positive results after hours for NFLX and IBM helped. GBP recovered and rose but otherwise currencies were down. The only exception was JPY, which along with Bonds and Gold was up, in line with the equity risk-off move. Oil was down for the same reason.

Wednesday January 22

SPX and NDX recovered at first today, briefly making intraday all-time highs, but fell back along with other markets as the virus scare dampened enthusiasm. Haven assets Gold and Bonds were up, although JPY was flat. A sharp early rise in GBP, followed the PSBR beat at 0930, and an expectation that interest rates will not be cut. CAD fell 1% on a dovish BoC report, downgrading growth projections. With EUR slightly up, the CAD move was not enough to prevent DXY from posting a red candle for the day.

Thursday January 23

Stocks fell again in early trading but rebounded on a WHO report that the coronavirus was not “a global emergency”, and all except FTSE closed up. A sharp fall in EUR after a dovish (or at least not hawkish, as expected) ECB presser resulted in a sharp uptick in DXY. AUD was strongly up on the Australian jobs beat, but gave up all up in the US session, on virus fears. The late rebound was not enough to prevent the haven trio from rising across the board, and Oil falling again.

Friday January 24

A second coronavirus case in the US caused a huge plunge in SPX, down 1% from the high of day, after an early rally. European indices did not therefore join in, and although pulling back slightly from the highs of the day, DAX and FTSE still closed green. Like yesterday, NKY was down on further yen strength. The dollar, however was up overall due to continuing EUR weakness, and a pullback in GBP. The haven trio of Gold, Bonds and JPY were all up, and Oil was down, in line with the equity move.

WEEKLY PRICE MOVEMENT

Equities were down with the worst performer DJIA hit as proportionally more earnings releases added to the downward sentiment. AUDJPY was the strongest mover, down 1.61%. FANGS held up quite well, with NFLX earnings bucking the trend and adding 3.97% to the TV giant. Cryptos pulled back after last week's rally but volatility is still quiet.

Note we use Google Finance data for daily movements, listing UUP as a proxy for DXY. All references to ‘the dollar’ are based on DXY. The equity and index prices are now based on the cash close each day.

NEXT WEEK (all times are GMT)

(Calendar High volatility items are in bold)

• US and UK Rate Decisions
• Chinese New Year
• AAPL AMZN MSFT Earnings
• UK leaves the EU

Monday January 27

Markets are closed in China, Hong Kong, Taiwan and Vietnam for the Chinese New Year. The last Year of the Rat was 2008! Australia and Korea are also closed. This week, watch out for movement in the Democratic primary candidates support ahead of the Feb 3 caucus (Biden: good for markets, Sanders and Warren: less so). The Italian regional election on Sunday may affect European markets.

09:00 EUR Germany IFO  Climate/Expectations (Jan)

15:00 USD New Home Sales (MoM) (Dec)

Tuesday January 28

Earnings season continues with Dow defensive MMM before the bell, but the big one is AAPL, the world’s largest company (12% of NDX, 7.4% of DJIA and 4.84% of SPX) which joins fellow NDX stocks AMD and SBUX after the close. There is a rate decision today on HUF. Chinese markets remain closed until Friday.

13:30 USD US ND Capital Goods (MoM e0.2% p0.1%)

14:00 USD US S&P/Case-Shiller Home Price Indices

15:00 USD US Consumer Confidence

21:30 AAPL earnings

Wednesday January 29

The Fed rate decision today has a 1.75% hold 87% priced in, with a 13% possibility of a 25bp hike. A hold therefore points to a further upside in stocks. It’s another important earnings day today, with BA, DOW and MCD reporting pre-market. BA has been overtaken by AAPL as the top DJIA company, but is still 7.39% of the index, and the three together are 13.52% by weight. The end of the day sees MSFT FB and TSLA report. These three are 7.24% of NDX. All this portends a lot of volatility. Markets are closed in Mexico and New Zealand.

00:30 AUD Australia CPI (RMA Trimmed Mean QoQ e0.4% p0.4%)

07:00 EUR Germany Gfk Consumer Confidence Survey (Feb)

15:00 USD US Pending Home Sales (MoM) (Dec)

19:00 USD Fed Rate Decision/Statement (e1.75% hold)

19:30 USD FOMC Presser

21:45 NZD NZ Imports/Exports/TB

Thursday January 30

Today’s earnings are DJIA stalwart KO before the bell, and NDX giant (7.83% by weight) AMZN after the close. ECB hawk Wiedmann speaks at 1800.

08:55 EUR Germany UnEmp Rate/Change

10:00 EUR Eurozone UnEmp/Business Climate

12:00 GBP BoE Rate Decision/Statement

12:30 GBP BoE Presser

13:00 EUR Germany Prelim CPI (YoY e1.7% p1.5%)

13:30 USD US Prelim 19Q4 GDP (YoY e2.1% p2.1%)

13:30 USD US Jobless Claims/PCE QoQ)

23:30 JPY Tokyo CPI (Core YoY e0.8% p0.8%)

Friday January 31

Today is month end, which could involve repositioning, and also Brexit day, the long-awaited departure of Britain from the EU takes effect at 2300 (midnight in Europe). The Eurozone double GDP and inflation print is the most important event of the day.

02:00 CNY China PMIs

10:00 EUR Eurozone Prelim 19Q4 GDP (YoY e1.1% p1.2%)

10:00 EUR Eurozone Prelim CPI (Core YoY e1.4% p1.3%)

13:30 USD US PCE MoM/YoY

13:30 USD US Personal Income/Spending

14:45 USD Chicago PMI

15:00 USD Michigan CSI

This report is published every week as an email by MatrixTrade.com - you can sign up to receive it here. This blog is supported solely by advertising, so if any of the ads interest you, please click on them. If you want notification when the blog is updated, please follow me on Twitter, Facebook, Stocktwits, TradingView or Linkedin (all open in separate windows). Details of how I compile the report are here.

Week to Jan 17th

Earnings open positively, All-time highs again, Phase 1 China deal signed

Monday January 13

Another all-time high for SPX and NDX, with tech shares leading as the January effect continues unabated, warmed by the easing of US/Iran tensions. USD was up in line, with only EUR outperforming which led to DAX being the only index in the red. The haven trio of Gold, bonds and JPY were of course down, and Oil, which benefits from Middle East tension dropped sharply by over $2.

Tuesday January 14

First off the block in earnings is JPM, who along with C beat earnings and revenue estimates, leading to a divergence with DJIA up but SPX and NDX flattish, taking a breather from the rally. A Turnaround Tuesday for the haven trio, now up, and Oil which recovered from the sharp drop. Otherwise only GBP was up in an overall flat day for the dollar as well.

Wednesday January 15

The mood cooled today with GS missing EPS substantially (4.69 vs 5.52) and BAC and Dow component UNH missing on revenue. SPX and NDX ended flat on the day. Nevertheless, JPY was flat in an otherwise weak day for the dollar, possibly selling the news, as the China Phase One deal was signed on schedule. Gold and Bonds were still up, and Oil was flat after a brief spike down.

Thursday January 16

The largest company to report today was MS, another beat, and along with the Retail Sales beat at 1330, US markets resumed their climb. There was a sharp spike up and down on DAX after the ECB minutes. The only red index was FTSE as a result of GBP strength, the only currency (other than NZD) up today. Gold, JPY and Bonds were down, and Oil was up, all in line with the equity moves.

Friday January 17

The euphoria continued into Friday, with all markets rising, and DAX breaking its closing Jan 18 high, and coming with 40 points of a new high. Oil rose as expected. Bonds were down in line, although notably Gold and JPY (meaning NKY didn’t join the party) were up. The latter was particularly notable as DXY hit a new 2020 high, and was up against all other currencies. There were no significant earnings today.

WEEKLY PRICE MOVEMENT

In this risk-on rally week, the top performing index was unsurprisingly NDX, with a second week of outperformance by FANGs. Meantime USDJPY was the best performer for a second week. Crypto rallied, in particular ETH, up nearly 18%.

Note we use Google Finance data for daily movements, listing UUP as a proxy for DXY. All references to ‘the dollar’ are based on DXY. The equity and index prices are now based on the cash close each day.

NEXT WEEK (all times are GMT)

(Calendar High volatility items are in bold)

• Four major rate decisions
• Davos conference
• Key NDX/tech earnings
• PMI day on Friday

Monday January 20

US Markets are closed today for Martin Luther King day. Everywhere else is open as normal. Dow component AXP reports before the bell.

01:30 CNY PBoC Interest Rate Decision (p4.15%)

07:00 EUR Germany PPI

Tuesday January 21

Earnings season continues but the key releases NFLX and IBM come after the bell. The World Economic Forum in Davos, Switzerland starts today and runs for the whole week. President Trump will be there, along with TreasSec Mnuchin. Today is the end of the self-imposed deadline for a solution to the France/US spat on digital taxes.

03:00 JPY BoJ Rate Decision/Statement (e -0.1% hold)

06:00 JPY BoJ Presser

09:30 GBP Unemp/AHE (UnEmp e3.9% p3.8%)

10:00 EUR Germany ZEW Economic Sentiment (e4.3 p10.7)

14:30 NZD NZ GDT Milk Index

Wednesday January 22

Dow component JNJ report before the bell today, but the key focus is Canada, with the inflation release and rate decision 90 minutes later. There is also a rate decision in Malaysia.

09:30 GBP UK PSBR

13:30 USD Chicago Fed National Activity Index

13:30 CAD Canada CPI (YoY e 1.9% p1.9%)

14:00 USD Housing Price Index (MoM) (Nov)

15:00 USD Existing Home Sales (MoM) (Dec)

15:00 CAD BoC Rate Decision/Statement (e1.75% hold)

16:15 CAD BoC Presser

23:50 JPY Japan Imports/Exports/TB

Thursday January 23

Although the ECB is the most important news today, the most volatility will probably come after the bell when MSFT (10.78% of NDX) reports along with INTC, SBUX, TXN, WDC and ISRG. Together with MSFT this is 17% of NDX, the largest concentration in any one day of earnings season. Dow component TRV reports before the bell. There are also rate decisions in Norway and Indonesia. Markets are closed in Romania.

00:30 AUD Australia NFP/UnEmp (NFP e14k p39.9k)

12:45 EUR ECB Rate Decision/Statement (e0% hold)

13:30 EUR ECB Presser

13:30 USD US Jobless Claims

21:45 NZD NZ CPI (e2.2% p1.5%)

22:00 AUD Aus Commonwealth Bank Manuf PMI

23:30 JPY Japan National CPI

23:50 JPY BoJ MPC Minutes

Friday January 24

There are no significant earnings today, and so focus will be on PMIs, and possibly any Davos wrap-ups.. ECB Villeroy is the only CB speaker. Markets are closed in China today for the Chinese New Year and will not reopen until the following Friday. There is a rate decision in Nigeria.

08:30 EUR Germany Markit PMIs (Manuf e43.3 p43.7)

09:00 EUR Eurozone Markit PMIs (Composite e51 p50.9)

09:30 GBP UK Markit PMIs (Services e49.4 p50) 

13:30 CAD Canada Retail Sales (MoM e0.1% p-1.2%)

14:45 USD US Markit PMIs

This report is published every week as an email by MatrixTrade.com - you can sign up to receive it here. This blog is supported solely by advertising, so if any of the ads interest you, please click on them. If you want notification when the blog is updated, please follow me on Twitter, Facebook, Stocktwits, TradingView or Linkedin (all open in separate windows). Details of how I compile the report are here.

Week to Jan 10th

Iran retaliation muted, DJIA 29000, NFP miss halts rally

Mon Jan 6

Markets were on edge in the early part of today, continuing the sentiment from Friday, and awaiting Iran’s response to the assassination of their top general last week. However, although DAX and FTSE closed down, by the close, sentiment had recovered sufficiently to post a positive day for US indices and non-US futures.  The dollar was initially sold off in London for the same reason, and did not recover by the end of the day. Gold, JPY and Bonds were of course up, but Oil faded slightly, giving back some of its huge gain on the initial action.

Tuesday January 7

Another down day for the same reasons as Monday, waiting for Iran, with all indices in the red. The dollar stayed a recovery, maybe in response to Trade Balance (1330) and Services PMI (1500) beats, which added to the beats in yesterday’s Manufacturing PMIs. However, the risk-off mood remained, with JPY, bonds and Gold all up. At the very end of the day, the Iranians did strike back, which cause a sudden move in the markets, in the risk off direction, which you can see around midnight.

Wednesday January 8

As relief unfolded that the Iranian response to the Solemaini killing was relatively muted, a few missiles at a US base with apparently no casualties, and a statement from Iran that their response was concluded, markets rallied, and risk assets and Oil fell sharply, erasing completely last Thursday’s gains. The dollar was up across the board (other than with AUD and NZD were flat/slightly up) as well, a clear change in mood, not doubt helped by the substantial beat (202k vs 150k) in the ADP jobs report.

Thursday January 9

The Iran relief factor continued into a second day, despite a series of economic misses, particularly the Chinese inflation print at 0130. All indices everywhere were up, as again was the dollar across the board. Gold was down in line, but after a 10bp move up on Wednesday, yields pulled back slightly. Oil was down although the move was much shallower than on Wednesday. Late in the day, without any fanfare, the UK finally passed its long-awaited Brexit bill.

Friday January 10

The NFP print today disappointed, coming in at 145k against the modest estimate of 164k. Futures had made a new ATH of 3288 just before the release, and then SPX (and all other indices) faded gently for the rest of the day, although DJIA briefly made a new round point high of 29000. The dollar was also down today (with only GBP going lower), and in line with equities, the haven trio were all up. Oil hardly moved, down about 30c on the day.

WEEKLY PRICE MOVEMENT

The biggest forex move in this risk-on week was unsurprisingly USDJPY, leading to the biggest index gain on the NKY. Crypto assets rallied as well, and some FANGS well-outperformed NDX generally.

Note we use Google Finance data for daily movements, listing UUP as a proxy for DXY. All references to ‘the dollar’ are based on DXY. The equity and index prices are now based on the cash close each day.

NEXT WEEK (all times are GMT)

(Calendar High volatility items are in bold)

• Earnings season begins
• US, UK and Germany inflation
• Phase 1 deal to be signed
• Large Fed speaker roster

Monday January 13

Fed Rosengren (hawk) and Bostic (centrist) speak today, although both are non-voters. Boris Johnson’s Brexit deal, passed last Thursday in the UK’s lower house, goes to the upper House of Lords today, although the convention is that manifesto commitment bills are not challenged.

09:30 GBP UK GDP

15:30 CAD BoC Business Outlook Survey

Tuesday January 14

Earnings season opens today, with, as always the banks. Today JPM, C and WFC report before the bell. Fed Williams (dovish) and George (hawk) speak today. Only Williams has a vote.

07:00 CNY China Imports/Exports/TB

13:30 USD US CPI (MoM e0.2% p0.2%)

14:00 USD Fed's Williams speech

Wednesday January 15

The long awaited Phase 1 of the China trade deal is due to be signed today, although clearly, this is already priced in. More bank earnings today before the bell from BAC and GS, and also from DJIA component UNH. Fed Harker and Kaplan (voters) speak.

08:40 GBP BoE Saunders speech

09:30 GBP UK CPI (YoY e1.5% p1.5%)

10:00 EUR Eurozone Industrial Production

13:30 USD US PPI

16:00 USD US-China Phase One Trade Deal Signature

16:00 USD Fed Harker speech

18:00 EUR ECB Weidmann speech

Thursday January 16

A US Forex treasury report is expected today. All eyes will be on whether China is de-listed as a currency manipulator. Some smaller banks report before the bell. There are rate decisions on TRY and ZAR. US Retail Sales is the main release.

07:00 EUR Germany CPI (YoY e1.5% p1.5%)

09:30 GBP BoE Credit Conditions Survey (Q4)

12:30 EUR ECB MPC Minutes

13:30 USD US Retail Sales (Control Group MoM e0.4% p0.1%)

13:30 USD Philly Fed Manufacturing Survey

13:30 USD US Jobless Claims

15:00 USD Fed Bowman speech

Friday January 17

Fed Harker speaks again today, and there are more small bank earnings. There is a rate decision on KRW

02:00 CNY China GDP (YoY e6% p6%)

02:00 CNY China Retail Sales

09:30 GBP UK Retail Sales

10:00 EUR Eurozone CPI

13:30 USD US Building Permits/Housing Starts

14:00 USD Fed Harker speech

14:15 USD US Industrial Production (MoM) (Dec)

15:00 USD US Michigan CSI (e99.4 p99.3)

17:45 USD Fed Bowman speech

This report is published every week as an email by MatrixTrade.com - you can sign up to receive it here. This blog is supported solely by advertising, so if any of the ads interest you, please click on them. If you want notification when the blog is updated, please follow me on Twitter, Facebook, Stocktwits, TradingView or Linkedin (all open in separate windows). Details of how I compile the report are here.

Week to Jan 3rd

New Year Week, China Good News, Iran Assassination

Mon Dec 30

After a strong rally for weeks, markets took a breather today, possibly banking year-end profits, as there was no specific news to cause the 0.70% pullback. The move was reflected in Gold and Bonds and JPY, all of which were up. The move was not as strong in other currencies, but all gained against the dollar. Oil was down in line with equity mood. With many markets closed thin trading may have exacerbated the moves.

Tuesday December 31

It was a quiet ending to the day, month, year and decade, with stocks quiet at first, and then making a strong rally into the close to erase yesterday’s losses and then some. Only FTSE failed to go green, following a strong 1.14% rally in GBP. The dollar continued to pull back and Gold and all major currencies advanced. Bonds were down in line with the equity move, but Oil fell again. This short day was all about positioning for end-of-year reporting, rather than any actual news moves.

Wednesday January 01

Markets were closed everywhere, although forex trades, which are not done on exchanges, continued , although as you would expect, volume and therefore volatility was very thin. A move up of 0.22% in CAD was the most any major made.

Thursday January 02

The China Phase 1 deal was augmented today by positive comments from China about it, and further negotiations made during the trading session. Coupled with some New Year positioning, carrying on the ramp on Tuesday afternoon meant all indices were up. Notably however, Gold, JPY and Bonds were also up, an indicator of possible things to come. The move in JPY was only 0.03% on another nearly flat forex day, where only CAD moved more than 0.1%. Oil was also down in a sign that the rally was fragile and done on low volume. It should be noted that four out of five manufacturing PMI reports today missed, only Germany beat estimates.

Friday January 03

The overnight US targeted strike on a top Iranian commander sent Asian and then European and US markets into a tailspin. As you might expect with anything Middle Eastern, oil soared in price, as did Gold, JPY and bonds. Otherwise the dollar was down across the board. A strong risk-off day, as you would expect.

WEEKLY PRICE MOVEMENT

The biggest index move on this quiet week was DAX, down 0.88%, and the strongest currency move was NZDJPY, down 1.77%. ETH made up some of the ground from last week, whereas BTC once again was flat. FANGs slightly outperformed NDX, in particular AAPL, which briefly touched $300 for the first time.

Note we use Google Finance data for daily movements, listing UUP as a proxy for DXY. All references to ‘the dollar’ are based on DXY. The equity and index prices are now based on the cash close each day.

NEXT WEEK (all times are GMT)

(Calendar High volatility items are in bold)

• Non-Farm Payrolls
• Services PMIs
• Various CB speakers
• First full week of new decade

Monday January 6

Back to work for many traders, and volumes should increase with plenty of data this week. Last week was Manufacturing PMIs which were generally poor, and this week it is Services. Unusually, ECB Lane and BoC Wilkins speak over the weekend, but markets will generally be guided by the next step in the latest US-Iran bellicosity.

01:45 CNY China Caixin Services PMI (Dec)

07:00 EUR Germany Retail Sales (MoM) (Nov)

08:55 EUR Germany Markit PMI Composite (Dec)

09:00 EUR Eurozone Markit PMI Composite (Dec)

09:30 GBP UK Markit Services PMI (Dec)

14:45 USD US Markit Services PMI (Dec)

14:45 USD US Markit PMI Composite (Dec)

Tuesday January 7

The ISM Services PMI is important today, following the miss in the Manufacturing print last week. Otherwise Eurozone inflation is the key release. 

10:00 EUR Eurozone Prelim CPI (Core YoY e1.3% p1.3%)

13:30 USD US Trade Balance (Nov)

13:30 CAD Canada International Merchandise Trade (Nov)

15:00 USD US ISM Non-Manufacturing PMI (Dec) (e54.5 p53.9)

15:00 CAD Canada Ivey Purchasing Managers Index

15:30 NZD NZ GDT Milk Index (time approx)

Wednesday January 8

A quiet day on the news front as markets get back to normal. The ADP ‘preview’ of Friday’s jobs report has a similar estimate. There are rate decisions on PLN and RON.

07:00 EUR Germany Factory Orders s.a. (MoM) (Nov)

10:00 EUR Eurozone Business Climate (Dec)

10:30 EUR Germany 10Y Bond Auction (time approx)

13:15 USD US ADP Employment Change (Dec) (e150k p67k)

Thursday January 9

Chinese inflation will definitely set the tone on this busy day, and we have our first Fed speakers of 2020. There is a rate decision on ILS

00:30 AUD Aus Imports/Exports/TB

01:30 CNY China CPI (p4.5%)

07:00 EUR Germany Trade Balance s.a. (Nov)

07:00 EUR Germany Industrial Production s.a. (MoM) (Nov)

10:00 EUR Eurozone Unemployment Rate (Nov)

13:00 USD Fed Clarida speech

13:15 CAD Canada Housing Starts s.a (YoY) (Dec)

13:30 USD US Jobless Claims

16:30 USD Fed Williams speech

19:00 CAD BoC Governor Poloz speech

19:10 EUR German Buba President Weidmann speech

Friday January 10

The first jobs print of 2020, and the estimate is climbing back to the 180-200k mean. Canada reports simultaneously so the scope for a big USDCAD move is there, especially if it first moved strongly on Thursday’s BoC speech.

00:30 AUD Retail Sales s.a. (MoM) (Nov)

13:30 USD US NFP/AHE/UnEmp (NFP e160k p266k)

13:30 CAD Canada NFP/AHE/UnEmp (NFP e20k p-71.2k)

This report is published every week as an email by MatrixTrade.com - you can sign up to receive it here. This blog is supported solely by advertising, so if any of the ads interest you, please click on them. If you want notification when the blog is updated, please follow me on Twitter, Facebook, Stocktwits, TradingView or Linkedin (all open in separate windows). Details of how I compile the report are here.