FUNDAMENTAL AND TECHNICAL ANALYSIS REPORT

11 Oct

FUNDAMENTAL AND TECHNICAL ANALYSIS REPORT – 11 October 2022

/ CSFX Analytics

Under $1,700 Gold Drops on Hawkish Fed

Asia Pacific stocks fell further on Tuesday. The Shanghai Composite is down 0.18% at 2,968.67. Overall, the Singapore MSCI is down 0.25% at 279.65. Over in Hong Kong, the Hang Seng Index is down 2.18% at 16,843.00. In Japan, the Nikkei 225 is down 2.66% at 26,380.00, while the Topix index is down 1.97% at 1868.00. South Korea’s Kospi is down 2.17% at 2,184.37. Australia S&P/ASX 200 down 0.34% at 6645.00.

Top News of the Day:

Gold prices hovered above annual lows on Tuesday after tumbling sharply on hawkish signals from the Federal Reserve, while copper prices rose on hopes that Chinese demand will persevere despite recent economic headwinds.

Federal Reserve Vice Chair Lael Brainard on Monday emphasized the need for restrictive monetary policy, and said that the economic damage of recent rate hikes was yet to be felt.

Market Summary as per 10/10/2022:

European equities Monday closing. The DAX futures contract in Germany traded down 0.01% at 12,272.94, CAC 40 futures down 0.45% at 5840.56 and the UK 100 futures contract in the U.K. down 0.45% at 6959.32.

In the U.S. on Wall Street, the Dow Jones Industrial Average closed down 0.32% at 29202.89. The S&P 500 down 0.75% at 3612.40 and the Nasdaq 100 down 1.02% at 10926.97, NYSE closes down 0.76% at 13693.57.

Top Market News Today:

In the Forex market, GBPUSD down 0.21% at 1.1030. The USDJPY up 0.08% at 145.778. The USDCHF up 0.14% at 1.0009. EURUSD down 0.13% at 0.9685, EUR/GBP up 0.07% at 0.8778. The USD/CNY up 0.42% at 7.1856 at the time of writing.

In the Commodity market U.S. Gold futures down 0.19% at $1,664.87. Elsewhere, Silver futures down 0.88% at $19.414 per ounce, Platinum up 0.11% at $893.00 per ounce, and Palladium up 0.18% at $2176.00.

Crude Oil down on Tuesday; Brent Crude Oil down 0.13% at $95.86 per barrel while U.S. West Texas Intermediate (CLc1) down 0.03% at $89.75.

In the Cryptocurrency Markets, Bitcoin at 18940.00 down 0.97%, Ethereum down 2.61% at 1268.00, Litecoin at 51.73 down 1.77%, at the time of writing.

Top Market Segment to Watch Out Today:

AstraZeneca Plc.: Attempts by Oxford University researchers and AstraZeneca (NASDAQ:AZN) Plc to create a nasal-spray version of their jointly developed COVID-19 shot suffered a setback on Tuesday as initial testing on humans did not yield the desired protection.

Economic News:

US: The U.S. Federal Reserve is clear on the need for restrictive monetary policy to lower inflation, Fed Vice Chair Lael Brainard said on Monday, but the path and pace of rate increases will remain “data-dependent” as the central bank monitors the economy and the evolution of domestic and global risks.

In prepared remarks and responses to questions, Brainard said Fed rate hikes to date were beginning to slow the economy – perhaps even more than expected – and that the full brunt of tighter policy would not even be felt for months to come.

Additionally, the “concurrent” rate hikes by central banks abroad as they all fight local outbreaks of inflation was creating an impact “larger than the sum of its parts” that posed potential risks U.S. officials need to monitor, Brainard said.

She referred to projections of policymakers about the path of interest rates, which as of September showed the median officials anticipating the federal funds rate rising to around 4.6% next year, as “very helpful at a point in time,” but also based on expectations about how the economy will evolve.

Euro Zone: British finance minister Kwasi Kwarteng needs to make 62 billion pounds ($69 billion) of spending cuts or tax rises to stop public debt growing ever-larger as a share of the economy, the Institute for Fiscal Studies (IFS) said in a report on Tuesday.

Interest rates for new long-term government borrowing leapt to a 20-year high last month, after Kwarteng announced 45 billion pounds of unfunded tax cuts, on top of even greater short-term support for households’ and businesses’ energy bills.

Kwarteng has sought to regain market confidence by scrapping a plan to axe Britain’s top rate of income tax – saving 2 billion pounds – and bringing forward plans for new forecasts and a debt reduction plan to Oct. 31.

But the IFS think tank – whose views on budget policy are closely watched in Britain – said Kwarteng would face an uphill struggle to convince sceptical markets that his plans will boost growth to 2.5% a year promised by Prime Minister Liz Truss.

Top Economic Releases Today:

U.K. Claimant Count Change (Sep) today at 02:00 this time estimated 4.20K, previously which was 6.30K.
00.
U.S. 3-Year Note Auction today at 13:00 previously which was 3.564%.

JAPAN Core Machinery Orders (YoY) (Aug) today at 19:50 this time estimated 12.6%, previously which was 12.8%.
U.K. Unemployment Rate (Aug) today at 2:00 this time estimated 3.6%, previously which was 3.6%.