Tag Archives: markets

Market Reactions to Trump’s Tariffs

Market Reactions to Trump’s Tariffs: In a move that reignited global trade tensions,
U.S. President Donald Trump announced a new round of tariffs on key trading partners,
with China again at the center of the economic storm.
The markets didn’t take long to react — and the response was loud and clear:
sharp sell-offs across equities, oil, and currencies, and a flight to safe havens like gold and the Japanese yen.

This article explores what happened, why,
and which assets were most affected so you can make smarter trading decisions with Evest.

 

Content

The Return of Tariffs

Market Reactions

Crypto Holds Its Ground

Why These Assets

Chinese Equities

The meaning for Traders

Final Thoughts

 

 

 

 

 

The Return of Tariffs: What Did Trump Announce?

Trump’s latest announcement introduced new tariffs on Chinese imports,
targeting the technology and industrial sectors.
The move, reminiscent of the previous trade war,
aims to rebuild U.S. manufacturing strength and reduce dependence on Chinese supply chains.

China responded immediately, imposing a 34% retaliatory tariff on U.S. tech products
such as semiconductors and processors — escalating the trade standoff again.

 

Market Reactions: From Sharp Sell-Offs to Safe-Haven Flight

U.S. Equities

Investors quickly exited risk assets, triggering widespread losses across U.S. indices:

The Dow Jones fell by 2.1%, losing around 740 points.

The Nasdaq Composite dropped 2.8%, led by weakness in tech stocks.

NVIDIA stock plunged 6.3%, closing at $94.3, as fears over tariffs hit semiconductor companies.

Oil

The energy sector followed suit:

Brent crude tumbled 3.7%, closing at $62 per barrel — its lowest level in two months.

Concerns over reduced global demand amid trade restrictions weighed heavily on oil prices.

Currencies

The U.S. dollar weakened across significant currencies, with the euro rising to 1.0962, nearly testing the 1.1200 resistance.

The Japanese yen surged as traders sought safe havens, bringing USDJPY down to 146.90.
Analysts are watching the 145.85 support level closely.

Gold

Gold rallied strongly:

It touched historic highs near $3168 before correcting slightly to close at $3037.

The yellow metal continues to act as a hedge in times of geopolitical stress and economic uncertainty.

Crypto Holds Its Ground — For Now

While traditional markets trembled, cryptocurrencies showed surprising resilience.
The overall sentiment in the digital asset space remained cautious but stable:

Bitcoin traded within a narrow range between $72،000 – and $87،000, holding up amid global uncertainty.

Significant altcoins like Ethereum and BNB saw mild pullbacks but no major breakdowns.

This relative calm is due to:

Some investors view crypto as an alternative hedge in times of economic tension.

However, others remain wary that trade wars and regulatory tightening could slow crypto adoption globally.

So far, crypto markets have not mirrored the volatility seen in stocks and commodities,
but a prolonged trade dispute could shift investor behavior in the weeks ahead.

 

Why These Assets Reacted This Way

Tariffs typically lead to higher production costs and slower economic growth.
These trade measures increase operating expenses for companies that rely on imported goods,
particularly in industries such as technology and manufacturing.
As a result, corporate profit expectations decline, especially in sectors most exposed to global supply chains.
This erosion in profitability often weakens investor confidence,
prompting a shift of capital into safe-haven assets like gold and the Japanese yen.

Moreover, China’s immediate retaliation with its tariffs amplifies global uncertainty,
encouraging traders across all markets to adopt a more cautious, risk-averse stance.

 

 

 

 

 

Chinese Equities Feel the Heat 

The shockwaves were felt in Asia as well:

The Shanghai Composite dropped 2.6%.

The Hang Seng Index fell 3.1%, with heavy losses in tech and export-driven stocks.

Traders fear prolonged trade friction could stifle China’s growth
and disrupt global supply chains in semiconductors and electronics.

 

What This Means for Traders

At Evest, we see volatility as an opportunity — if approached with insight and strategy. Here’s how traders can navigate the storm:

 Monitor geopolitical headlines closely — trade news can trigger fast market moves.
Use risk management tools like stop-loss orders.
Consider adding exposure to safe-haven assets like gold and the yen.
Explore CFDs on affected stocks, commodities, and currencies to benefit from market swings.

 

Final Thoughts

Trump’s tariffs have shaken global markets and reminded investors that political policy
can move prices as much as earnings reports or economic data.
Whether you’re watching semiconductors, oil, currencies, or crypto, this moment demands close attention.

 

Stay informed, stay strategic — and trade confidently with Evest.

 

 

Market Reactions to Trump’s Tariffs

U.S. Crude Oil Inventories Rise Amid Market Anticipation

U.S. Crude Oil Inventories Rise Amid Market Anticipation: Data from the American Petroleum Institute (API)
reported an increase in U.S. crude oil inventories by approximately 1.2 million barrels during the week ending November 29.
Gasoline inventories rose by 4.6 million barrels, while distillate stocks, including diesel and heating oil, increased by over 1 million.

 

Content

U.S. Crude Oil Inventories Rise

China’s Service Sector
Bank of England Governor

 

 

U.S. Crude Oil Inventories Rise Amid Market Anticipation

Data from the American Petroleum Institute (API) reported an increase in U.S. crude oil inventories
by approximately 1.2 million barrels during the week ending November 29.
Gasoline inventories rose by 4.6 million barrels, while distillate stocks, including diesel and heating oil, increased by over 1 million.

Markets eagerly await official data from the U.S. Energy Information Administration (EIA),
which is expected to decrease crude oil inventories by about 2 million barrels.
These figures will likely influence crude oil prices during today’s trading sessions.

 

Slowing Growth in China’s Service Sector Amid New Trade Concerns

Growth in China’s service sector slowed in November as new business activity contracted.
This coincided with concerns over potential trade policies under U.S. President-elect Donald Trump,
which may include additional tariffs on Chinese exports.

A survey conducted by S&P Global revealed that the Caixin Services Purchasing Managers’ Index (PMI)
dropped to 51.5 in November from 52 in October. Despite the decline, the index remained above the 50-point threshold, which indicates growth.

The results align with official data for the non-manufacturing sector, where the PMI fell to 50 earlier.
 Economist Wang Zhi from Caixin Insight noted that service providers in China expressed
optimism about market improvement due to government support measures, despite concerns about the future trade environment.

The survey also highlighted a decline in new business activity to 51.8 from 52.1
due to weakened external demand. However, the service sector continued
to add jobs for the third consecutive month to meet work pressures,
while business confidence reached its highest level in seven months.

 

 

Bank of England Governor Expects Gradual Rate Cuts Next Year

Andrew Bailey, Governor of the Bank of England, stated in an interview with the Financial Times
that the central bank might implement up to four interest rate cuts next year,
contingent on continuing current economic expectations.
He explained that inflation had decreased faster than anticipated compared to last year,
reflecting significant improvements in the UK’s overall financial performance.

Bailey emphasized that the Bank of England is exploring multiple potential economic
scenarios but remains committed to a gradual rate-cutting strategy to stabilize prices and boost economic recovery.
This approach aims to balance fostering economic growth and maintaining financial stability, which remains a key priority for the bank.

He also noted that future challenges might require more direct bank
Intervention through stronger measures is needed to ensure
the gradual decline in inflation continues, and long-term economic sustainability is maintained.

Previously, Bailey reiterated the Bank of England’s commitment to supporting the British economy,
fostering growth and maintaining financial stability as its primary objective.

 

U.S. Crude Oil Inventories Rise

 

Inflation Nears ECB Target Amid Persistent Challenges

Inflation Nears ECB Target Amid Persistent Challenges: In recent statements, Philip Lane, Chief Economist of the European Central Bank (ECB),
emphasized that the ECB is making gradual progress toward achieving its inflation target of 2%.
Despite this progress, challenges remain, requiring flexible monetary policies and continuous evaluation of economic conditions.

These remarks come as efforts to stabilize prices and markets continue.
Provided no unforeseen geopolitical risks emerge, further progress is expected next year.

 

Content

European Central Bank
Germany’s Business Climate Index

 

 

 

Philip Lane: Inflation Nears ECB Target, but Challenges Persist

On Monday, Philip Lane, Chief Economist of the European Central Bank,
stated that the bank faces ongoing challenges in stabilizing prices at its 2% target.
He highlighted that reducing inflation remains a priority, mainly through further reductions in service prices to ensure the desired stability.

Lane noted that inflation is gradually nearing the set target,
adding that the final phase of achieving this goal may be completed next year,
assuming no geopolitical or political risks arise.

He also emphasized the importance of maintaining flexible monetary policies
that respond to negative and positive risks that could impact inflation trends.
Lane assured that the ECB continuously assesses economic conditions in every meeting,

enabling well-informed decisions aligned with market developments.

Regarding the future, Lane suggested that prolonged restrictive monetary policies might not be necessary,
hinting at their potential easing in the near term if economic conditions stabilize.

 

 

 

Germany’s IFO Business Climate Index for November Falls Below Expectations

On Monday, the IFO Institute for Economic Research revealed
that Germany’s Business Climate Index for November underperformed expectations.
The index fell to 85.7 points, compared to an expected 86.0 points,
with the previous October reading at 86.5 points.

The IFO Business Climate Index is one of the leading indicators closely monitored by markets.
It reflects the state of the German economy by assessing business sector reactions to current economic conditions.
Any change in this index serves as an early signal of future economic trends, including spending,
employment, and investment, making it a crucial tool for evaluating Germany’s overall economic performance.

 

 

Inflation Nears ECB Target Amid Persistent Challenges

U.S. Stocks Retreat After Longest Weekly Rally

U.S. Stocks Retreat After Longest Weekly Rally: After U.S. stocks recorded their longest weekly rally of the year,
the markets saw a pullback as traders braced
for key earnings reports from major companies like Boeing, Tesla, and United Parcel Service.
This retreat comes at a time when markets are overbought, increasing the likelihood of short-term profit-taking.

 

Content

U.S. Stocks Retreat

Wall Street Earnings Challenges

Broad Decline Across Indices

Interest Rate Expectations

Market Volatility

Continued Gains

Future Market Outlook

Earnings Season and Big Tech Performance

Impact of Hurricane Helene

Market Reactions to Corporate Earnings

Strategic Expectations

 

 

 

 

U.S. Stocks Retreat After Longest Weekly Rally

U.S. stocks took a breather after consecutive gains, pushing the S&P 500 to record highs.
According to SentimenTrader, the market saw about 30 sessions without consecutive losses,
one of the best streaks since 1928.
Dan Wantrobski, research director at Janney Montgomery Scott,
noted that the market remains overbought and vulnerable to short-term profit-taking.

 

Wall Street Earnings Challenges

Approximately 20% of the companies in the S&P 500 are expected to release their earnings this week,
making this earnings season one of the biggest challenges for Wall Street.
According to Bloomberg Markets surveys, company results are more crucial
in determining the market’s direction compared to the upcoming U.S. elections or Federal Reserve policies.

 

Broad Decline Across Indices

The S&P 500 fell by 0.4%, the Nasdaq 100 dropped by 0.1%,
and the Dow Jones Industrial Average decreased by 0.9%.
The Russell 2000 also saw a decline of 1.5%.
Additionally, homebuilder stocks experienced significant losses,
while United Parcel Service shares fell after a sell recommendation from Barclays.
In contrast, Nvidia reached a new record, and Boeing shares rose by 2.7% after reaching a tentative agreement with its union.

 

Interest Rate Expectations and Rising Bond Yields

U.S. 10-year Treasury yields rose by 9 basis points to 4.18%.
Increasing expectations suggest the Federal Reserve may keep interest rates unchanged in November,
with a potential rate cut of 20 basis points expected next month.

 

Market Volatility and Geopolitical Risks:

Oil prices rose as China moved to support its economy while traders monitored geopolitical risks in the Middle East.
Volatility in stock options, bonds, and currencies increased as investors paid more
for hedging against risks related to U.S. elections,

interest rate decisions, and concerns about expanding conflicts in the Middle East.

 

Continued Gains for the S&P 500

The S&P 500 has posted continuous gains over the past six weeks,
a rare occurrence that has only happened 53 times since 1950, accounting for about 8% of all six-week periods,
according to Adam Turnquist of LPL Financial.

 

 

 

 

Future Market Outlook

Turnquist explained that the index typically posts an average return of 0.2% in the week following such streaks,
with 58% extending to seven weeks.
The average returns over the next six and twelve months were 5.1% and 11.4%,
respectively, with above-average favorable rates for both periods.
Turnquist added, “With the market entering a potentially volatile
period before the elections and facing resistance near peak price levels,
historical data suggests that investors should take advantage of market dips to buy,
as momentum tends to continue after a six-week winning streak.”

 

Earnings Season and Big Tech Performance

David Laut from Abound Financial said, “We believe there is room for continued stock gains,
especially as markets enter a seasonally strong period of the year,
with November and December historically being good months for stocks.”He added,
“Earnings season is heating up, and soon we’ll hear from big tech companies and the latest on their AI investments.
For these companies, this is the quarter to prove their profitability.”
Tesla is expected to face questions this week during its earnings call about production targets
and regulatory challenges following the disappointing launch of its new Cybercab truck.
Boeing also faces challenges as it works to calm investor concerns about production delays,
labor disputes, and depleting financial resources.

 

Impact of Hurricane Helene on U.S. Stocks

The earnings results of companies like UPS, Norfolk Southern,
and Southwest Airlines are expected to reveal the combined impact of Hurricane Helene
and the three-day East Coast dockworkers’ strike during the last quarter.

 

Market Reactions to Corporate Earnings

Jeffrey Buchbinder of LPL Financial noted that expectations for third-quarter earnings are relatively low,
with analysts forecasting only a 3% increase in earnings per share for S&P 500 companies.
Buchbinder added that this low bar and a supportive economic environment could lead to gains.
However, he cautioned that the market may have already priced in these positive results.
According to Morgan Stanley strategists, led by Michael Wilson,
companies beating earnings estimates this season are rewarded more significantly than the past four quarters.
They also noted that revisions for 2025 have outperformed seasonal expectations.
Bloomberg Intelligence strategists Gina Martin Adams and Wendy Soong added
that the early days of earnings season are seeing relatively strong price reactions.

 

Strategic Expectations

According to Goldman Sachs strategists, including David Kostin,
U.S. stocks are unlikely to maintain their exceptional performance from the past decade.
Many investors may shift to other assets like bonds to achieve better returns.
The strategists expect the S&P 500 to deliver an annual nominal total return of just 3% over the next ten years,
compared to 13% over the past decade, with a long-term average return of around 11%.
In a note dated October 18, the team wrote,
“Investors should be prepared for lower-than-average returns on equities over the next decade,
likely closer to the lower end of the typical performance range.”
 

U.S. Stocks Retreat After Longest Weekly Rally

The IMF: Global Public Debt Could Exceed $100 Trillion in 2024 Amid Rising Spending in the U.S. and China

The IMF: Global Public Debt Could Exceed $100 Trillion in 2024 Amid Rising Spending in the U.S. and China:
The International Monetary Fund (IMF) expects total global public debt to surpass the $100 trillion mark in 2024,
Driven by increased spending in major economies such as the United States and China.
In its Global Financial Outlook report,
The IMF noted that the global public debt-to-GDP ratio will reach 93% by the end of this year
and is likely to approach 100% by 2030,
exceeding the peak observed during the COVID-19 pandemic, which was 99%.

 

Content

Details

 

 

 

Details

Countries like the United States, Brazil, France, Italy, South Africa,
and the United Kingdom is expected to see its debt levels rise.
The IMF warned that delaying action to address this issue
could trigger negative market reactions and weaken governments’ ability to manage their budgets in times of crisis.

The report also highlighted that global challenges,

such as the transition to clean energy, aging populations, and security risks,
have increased uncertainty regarding fiscal policies, adding pressure on public spending.
In the worst-case scenario, the IMF projected that the global debt-to-GDP ratio could reach 115% within three years.

 

The IMF: Global Public Debt Could Exceed $100 Trillion in 2024 Amid Rising Spending in the U.S. and China

Final Reading of U.S. GDP Data Surprises Markets

Final Reading of U.S. GDP Data Surprises Markets: The final reading of the U.S. GDP data, released by the Bureau of Economic Analysis on Thursday,
showed that the GDP growth rate for the first quarter of this year was revised upward, aligning with market expectations.

 

Content
Details

 

 

 

Details

The data revealed that the U.S. GDP grew by 1.4% in the first quarter,
matching the anticipated 1.4% growth, up from the initial 1.3% growth reported for the previous quarter.

The GDP price index also grew by 3.1% in the first quarter, slightly above market expectations of 3.0%.

The press release highlighted that the increase in real GDP primarily reflected rises in consumer spending,
fixed residential investment, non-residential fixed investment, and state and local government spending,
partially offset by a decline in private inventory investment and an increase in imports.

Markets closely watch GDP data, which provides a clearer picture of the U.S. economy’s quarterly performance.
Positive data exceeding market expectations generally has a favorable impact on the dollar,
while lower-than-expected readings can negatively affect it.

 

 

Final Reading of U.S. GDP Data Surprises Markets

U.S. stocks close the trading session lower.

U.S. stocks close the trading session lower: In the last 30 minutes of Wall Street trading,
stocks erased their gains as investors rebalanced their investment portfolios following
a buying wave that increased their value by more than $4 trillion this year.

 

Content

Closing Trades

Economic Data

Central Banks

U.S. Stock Index

Market Movements

 

Closing Trades

Stocks closed lower for the third consecutive day, after a frenzied buying period
that saw the S&P 500 index rise by nearly 10% in three months.
According to recent estimates from Morgan Stanley,
Funds are expected to sell about $22 billion in global stocks and buy $17 billion
in fixed income to return to original asset allocation levels.
The U.S. stock index is on track to record five consecutive months of gains from November
to March, a feat accomplished only once in this century, in 2013.
Now, traders are debating whether the path will become more difficult
to continue rising as stock valuations remain relatively high compared to history.
“We still expect to see normal pullbacks along the way,” said Keith Lerner at Truist Advisory Services.
“However, until the weight of the evidence shifts, we suggest investors stay
with the primary market trend, which is up, and view pullbacks as opportunities.”
The data supports both arguments as the big debate continues
on how concentrated or broad this year’s S&P 500 rise has been, approaching 5200.
After the year began with gains focused on tech-heavy sectors,
the rally broadened to include other groups like commodities and industrials.
However, the contribution to total returns shows that 60%
of the gains in the index were driven by just six stocks:
Nvidia, Microsoft Corp., Meta Platforms Inc., Amazon.com Inc., Eli Lilly & Co., and Broadcom Inc.

 

Economic Data

As traders prepared for the Fed’s preferred inflation gauge on Friday – when markets will be closed
they analyzed the latest economic readings. U.S. consumer confidence remained steady,
durable goods orders rose, and home price growth accelerated faster since 2022.
“Expect market volatility in the coming quarters with mixed data
and questions about how long the Fed intends to pause,”

said Victoria Fernandez at Crossmark Global Investments.
We would not be surprised to see another rate cut priced out of the market, pushing yields slightly higher
from current levels, as economic data shows strength and current levels do not appear to be very restrictive.”

 

Central Banks

For stocks to justify their multiple expansion in recent months, global central banks must ease monetary policy this year.
According to Marko Kolanovic at JPMorgan Chase & Co, companies must deliver healthy earnings growth.
“Overall, if central banks turn out to be more dovish than currently projected,
but without this being accompanied by growth disappointments,
current equity multiples could be defended,” he wrote this week.
He added that equity multiples must fall if earnings disappoint and central banks are more restrictive.
Institutional, retail, and hedge fund clients of Bank of America Corp.
were all net sellers of U.S. equities in the week ended March 22,
while corporations buying their shares were the sole net buyers.

 

The U.S. stock index

The S&P 500 is on track to witness its fifth consecutive month of gains,
with a cumulative price return of about 25%.
The rise was supported by an economy that exceeded expectations,
future corporate earnings estimates that reached record levels,
technological leadership, and expectations that the Federal Reserve will begin to lower rates later this year,
according to Lerner at Truist.
“Strong price momentum, as we’ve seen over the past five months,
tends to occur during bull markets and is a sign of underlying strength,” he added.
While the markets seem to be stretching,
similar past periods of strength also tended to be positive when looking forward 12 months
with stocks rising every time and showing an average gain of 14%, Lerner added.
“Stocks have risen in the first quarter in anticipation of the first-rate cuts,”
said Anthony Saglimbene at Ameriprise.
“We have likely already entered a period where the Federal Reserve
is now less likely to surprise the market from here on out.”
Prices will likely continue rising until late March, given the lack of evidence of technical deterioration,
according to Mark Newton at Fundstrat Global Advisors.
“I continue to see the U.S. stock market as technically attractive,
and I do not feel there is enough risk to justify a sell-off at this time,”
Newton said. He concluded that a rise in the S&P 500 to 5350-5400
is possible until mid-April – before consolidation begins.


 Market movements

Stocks
The S&P 500 was down 0.3%
The Nasdaq 100 fell 0.4%
The Dow Jones Industrial Average was virtually unchanged
Currencies
 The Bloomberg U.S. Dollar Index was virtually unchanged
The euro was steady at 1.0830
 The British pound was steady at 1.2625
The Japanese yen fell 0.1% to 151.58 against the dollar
 Cryptocurrencies
 Bitcoin fell 2% to $69,538.32
Ether fell 1.9% to $3,561.06
Commodities
 West Texas Intermediate crude fell 0.6% to $81.49 a barrel
Spot gold rose 0.3% to $2,177.89 an ounce

 

U.S. stocks close lower

A new week full of events and market news

A new week full of events and market news: It is important to stay informed and informed of all major events, developments and market fluctuations

In this report, Evest provides you with insights and analysis of the most important market news


Content

Japan to double its budget reserves 

Retail sales in America

Tesla announces a price reduction for its cars in China

Gold rises today

 

Japan to double its budget reserves

 

The Japanese government plans to double its budget reserves  to 1 trillion yen ($6.9 billion) in the next fiscal year,
Prime Minister Fumio Kishida said on Sunday.

Kishida announced the plan after visiting a region in northwestern Japan hit by a strong earthquake earlier this month.

 

Retail sales in America

US retail sales data are expected to be closely watched on Wednesday for signs that consumer spending,
the main driver of economic growth remains resilient amid rising interest rates.

Retail sales are expected to increase by 0.4% in December, after a 0.3% increase in November.

Data on housing starts and existing home sales are expected to reveal difficulties facing
the housing market in the face of rising borrowing costs.

 

Tesla announces a price reduction for its cars in China

Tesla announced a reduction in the prices of some of its versions in China.
The price of the Model 3 has been reduced by 5.9% to 245,900 yuan (about $34,300).

Model Y’s price has also been reduced by 2.8% from 266,400 yuan to 258,900 yuan.

The price of the Chinese-made Model 3 was reduced to 285,900 yuan,
while the price of the Chinese-made Model Y was reduced to 299,000 yuan.
At the same time, China’s regulatory body announced that Tesla will recall about 1.6 million cars in China
due to problems with the power steering system device. The recall includes Model S, Model 3, Model X and Model Y.
Tesla is working to resolve the issue immediately and plans to release over-the-air (OTA) updates to affected users

 

 

Gold rises today and breaks the 2050 barrier

The price of gold rose today, surpassing the $1950 level, and breaching the 2050 levels.
Gold is benefiting from some geopolitical turmoil that has arisen in the Red Sea,
with Britain and the United States announcing a continuing campaign of air attacks against the Houthis in the region.

fueled by expectations of an interest rate cut this year, Gold increase
investors are accumulating bets on a 166 basis point cut in interest rates this year, exceeding the 150 basis point cut bets last Friday.

 

 

A new week full of events and market news

How will the markets be affected by U.S. inflation data

How will the markets be affected by U.S. inflation data and the potential shock that may unsettle the Federal Reserve: Jerome Powell, the Chairman of the U.S. Federal Reserve, presented his views at the last December meeting on the central bank’s success in taming high inflation rates,
which dropped to 3.1%. This led Powell to suggest the possibility of the Fed starting to taper within the current year.

 

Topics

How upcoming inflation data will be interpreted?

Higher-than-expected U.S. inflation

Lower-than-expected U.S. inflation

A shock that may unsettle the U.S. Federal Reserve

 

How upcoming inflation data will be interpreted?

 

On Thursday, the markets await the annual U.S. Consumer Price Index (CPI) data, with experts anticipating a positive reading of around 3.2%,
compared to the previous reading of 3.1%. The monthly CPI is also expected to show a positive reading of around 0.2%, compared to the previous 0.1%.

 

Higher-than-expected U.S. inflation

A resurgence in U.S. inflation above expectations would qualify the ongoing upward trend of the U.S. dollar that began this year.
This is because expectations at that time would focus on the possibility of the Fed starting the taper late in the current year.


Lower-than-expected U.S. inflation

 

The idea of a decline in U.S. inflation strengthens the position of the U.S. Federal Reserve.
Faced with the scenario of an early reduction in high interest rates, this could potentially negatively impact the pricing of the U.S. dollar index.
On the other hand, we might witness positive movements in gold.

 

A shock that may unsettle the U.S. Federal Reserve:

 

After Jerome Powell raised the issue of reducing U.S. interest rates, which reached 5.50% by the end of 2024,
markets began to anticipate the taper starting in late March of the coming year.
However, the recent positive U.S. employment figures contributed to lowering those expectations.
, the markets eagerly await Consumer Price Index data, reflecting U.S. inflation levels.
annual consumer prices rise above 3.2%, it could signal a return to rising inflation with an acceleration.
This might prompt the Federal Reserve to taper later in the current year
or start at the end of 2024, potentially causing clear damage to the U.S. economy, especially with the extended period of keeping interest rates high.
Conversely, we may see a decline in economic growth rates, with the Federal Reserve expecting 1.4% growth during the current year.


How will the markets be affected by U.S. inflation data?

Week a head full of news and events

Week a head full of news and events: Market Volatility and economic events are ahead, this  report will update you with the most important events ahead and the most important news

 

Topic

The most important event this week

British pound against the US dollar

Oil

Gold

US dollar against Japanese yen

Nasdaq

 

 

The most important event this week

Monday, January 8th

Switzerland- Swiss Consumer Price Index (CPI)

Switzerland-Swiss Consumer Price Index (CPI) MoM

Thursday, January 11

Consumer Price Index (CPI) YoY-USA

The Consumer Price Index (CPI) MoM-USA 

Initial Jobless-USA 

Friday, January 12

China – China Consumer Price Index (CPI) YOY

UK-Gross Domestic Product (GDP) MoM

USA-Producer Price Index (PPI) YoY

USA-Producer Price Index (PPI) MoM

 

British pound against the US dollar

 

The dollar achieved weekly gains of 1.08% positive labour market data in the United States,
due to the optimism of the market about the US Federal Reserve
maintaining the current interest rate for  longer than expected
and sufficient to return inflation to the central bank’s target,
which provided strong support for the US dollar’s movements in the currency market,
outperforming its major counterparts.

 

Bullish scenario

The GBPUSD is moving between the support level of 1.2500
and the resistance level of 1.2826 and the highest rising trend line since last November.
The technical outlook for the pair is still bullish on the long-term
time frames given that the price is above the 200 moving average,
But in the short term, we still see bearish price action, since the pair failed to make a new high for 2023 in December.

If prices rise above the sub-resistance level of 1.2750,
it will push the pair to rise further to the main resistance of 1.2826, reaching the level of 1.3000.

Bearish scenario

However, if prices fall again below the minor support level of 1.2650,
this will likely push prices further to the main support of 1.2500.

 

Oil

Oil prices rose in last week’s trading session, achieving their first weekly gains in 2024,
aftermarket sentiment improved about the possibility of a recovery
in American demand for oil in the coming period,
especially after data from the US Energy Information Administration
revealed the positivity of oil inventories within the United States, and data was also raised.
The American labour market is better than expected.
The markets are optimistic about the strength of the labor market
and consequently the economic growth in the United States,
which occupies first place among the countries that consume the highest crude oil. Consequently, crude oil prices eventually rose.

Bullish scenario 

Oil prices moved in a narrow range during last week’s trading between the levels of 70 to 74 dollars,
forming an ascending triangle pattern that penetrated upward
coinciding with closing above the falling trend line since last October,
and below the resistance level of 76.04. If it is penetrated upward, it will be a signal to reach the resistance level. 80.00

Bearish scenario 

However, in the event of a return again below the pivotal level of 73.50,
this will push prices to fall again to the support level of 70.00,
and in the event of closing below with deep momentum,
it will be an indication of a further decline to the main support of 67.11.

 

 

Gold

After the US labour market data last Friday provided clear positivity through the jobs
that were added to the private non-agricultural sector by recording 216 thousand jobs instead
of expectations that indicated 177 thousand jobs, unemployment also stabilized at approximately 3.7%
instead of expectations that indicated an increase of approximately out 3.8%,
on the other hand, it showed an increase in wage rates and the provision of 0.4% instead of 0.3%,
which indicates the idea that the US Federal Reserve will begin reducing interest rates late this year,
which may contribute to a possible strength of the US dollar index and, in return, a negative movement for gold.

Bullish scenario 

What is important in the positive purchasing scenario is the confirmation of the strength
of the rebound from around the support and the rising bottom in the areas of 2033.80 to 2016.63 dollars,
and among the criteria for an increase in the possibility of a return of strength to buyers
is the break of the descending digital channel in addition to breaking
the horizontal resistance of 2060.29 dollars to the top.

The aforementioned technical condition was achieved at the time,
giving preference to a rise in prices and targeting the levels of $2089.14 to $2104.26,
by breaking it is possible to target $2148.58.

Bearish scenario

In the selling scenario, we rely on prices being below the descending digital channel,
in addition to prices being below the horizontal resistance of $2060.29.

With a directional movement on frames (30 minutes to 15 minutes),
it will support the idea of a decline in prices to target the $2016.63 levels, and
by breaking them and trading below them, the next target will be around the $1972.33 levels.

 

US dollar VS Japanese yen

A fateful week awaits the financial markets to read the data on US inflation rates for December.
The markets are anticipating and speculating about the date of starting
to reduce interest rates through US consumer price data.

Experts expect annual consumer prices to rise to 3.2% instead of the previous reading of 3.1%,
while monthly core consumer prices are expected to decline by 0.2% instead of 0.3%.
it is noteworthy that a decline in inflation will lead to an early reduction in interest rates,
and vice versa if inflation rises again. Others may add, in one form or another,
a continuation of the tightening, even if it is maintained for a longer period by the US Federal Reserve.

Bullish scenario

Through the positive scenario, which depends on the idea
of prices exiting the descending digital channel and prices trading positively,
it may continue, especially after prices take an upward directional movement.

With touching the bullish technical trend line,
it will likely coincide with the horizontal digital support level around 142.55,
an opportunity to rise and target the 146.30-148.15 levels.

Bearish scenario

Through the selling scenario, which reacts by breaking and stabilizing prices
below the existing digital support around 142.55,
then we will have a downward directional movement and ensure a strong return for sellers.

If the technical condition is met, prices will have an opportunity to target 140.70 levels,
and if prices break them and hold below them, the next target will be 138.95.

 

Nasdaq

The American markets witnessed some downward corrections during last week’s  trading
after the partial return of strength to the US dollar’s trading,
especially with the improvement in US job numbers again,
but the positive outlook remains for US stocks due to market expectations of more than 70%
that the Federal Reserve will reduce interest rates next in March,
which will reflect negatively on the dollar and positively on the American stock markets

Bullish scenario

The Nasdaq index is trading around the 16305 level after the downward correction
from the peak, it achieved around the 16975 levels,
as the index is trading near the turn-taking areas around the 16183 levels,
which is expected to push it upward again if behaviour seeking a reversal appears around those levels.

Bearish scenario

The Nasdaq may continue bearish trading if it breaks the 16183 levels
and closes below them in a trading session, and at that time,
the declines may continue to target the support centred around the 15700 levels.

 

Week a head full of news and events