FUNDAMENTAL NEWS AND TECHNICAL ANALYSIS REPORT – 24 FEBRUARY 2023

24 Feb 2023

Germany’s fourth-quarter GDP shrank by 0.4%

Asian stock market closes in red on Thursday. The Shanghai Composite is in red by 0.11% at 3287.48. Overall, the Singapore MSCI is in red 1.01% at 295.15. Over in Hong Kong, the Hang Seng Index is down 0.35% at 20351.35. In Japan, the Nikkei 225 is down 1.34 at 27104.32. While the Topix index is down 1.11% at 1975.25, South Korea’s Kospi is up 0.89% at 2439.09. Australia S&P/ASX 200 up 0.27% at 7304.90.

Top News of the Day: –

The German economy contracted at the end of the year, as inflation and the energy crisis took their toll on household consumption and capital investment.

The German economy shrank by 0.4% in the fourth quarter of 2022 compared with the previous three months, the statistics office said on Friday.

Preliminary data from the office had pointed to a 0.2% quarter-on-quarter contraction adjusted for price and calendar effects. In the third quarter of 2022, GDP saw slight growth of 0.5% compared to the three months prior.

After relief measures such as the fuel discount and the 9-euro transport ticket ended, consumers spent less on consumption in the fourth quarter than in the third quarter, the statistics office said. Household spending was down 1.0%.

Market Summary as per 23/02/2023:

European equities Thursday closing. The DAX futures contract in Germany traded up 0.49% at 15475.69, and CAC 40 futures up 0.25% at 7317.43. UK 100 futures contract in the U.K. is down 0.29 at 7907.72.

In the U.S. on Wall Street, the Dow Jones Industrial Average closed up 0.33% at 33153.91. The S&P 500 up 0.53% at 4012.32 and the Nasdaq 100 up 0.72% at 11590.40, NYSE is up 0.35% closing at 15584.92.

Top Market News Today:

In the Forex market, GBPUSD is up 0.07% at 1.2017. The USDJPY is up 0.16% at 134.90, and The USDCHF is up 0.24 at 0.9361. EURUSD down 0.12% at 1.0581. EUR/GBP is down 0.07% at 0.8811. The USD/CNY is up 0.46% at 6.9387 at the time of writing.

In the Commodity market, U.S. Gold futures are down at 0.09% $1,819.03. Elsewhere, Silver futures were down 0.66% at $21.15 per ounce, Platinum down 0.90% at $936.00 per ounce, and Palladium down 0.27% at $1476.50.

Brent Crude Oil is up 1.00% at $83.04 per barrel.

In the Cryptocurrency Markets, Bitcoin at 23791.00 down at 0.62%, Ethereum is down 0.15% at 1648.20, and Litecoin at 93.91 down 0.80%, at the time of writing.

Top Market Segment to Watch Out for Today:

GOLD-Gold prices rose slightly on Friday but were set for a fourth consecutive week in red amid growing uncertainty over U.S. monetary policy, with markets seeking more cues from a reading on the Federal Reserve’s preferred inflation gauge later in the day.

The yellow metal saw some relief as U.S. fourth-quarter GDP data was revised slightly lower, indicating that the economy had cooled more than expected under the yoke of high-interest rates. The reading pushed up some hopes that the Fed will have less economic headroom to keep raising rates.

Economic News:

US:- U.S. Treasury Secretary Janet Yellen said on Friday that U.S. inflation was coming down but there was still more work to do to bring it in line with the Federal Reserve’s 2% annual target.

Yellen also told reporters on the sidelines of G20 finance ministers and central bank governors’ meeting near the Indian tech hub of Bengaluru that she still believes that a “soft landing” without a recession is possible due to a strong labor market and strong U.S. balance sheets.

“Inflation is coming down if you measure it on a 12-month basis, but still core inflation, which I think will fall further, remains higher than is consistent with 2%,” she said, referring to the Fed’s target rate.

Echoing comments, she made on Thursday that the U.S. and global outlooks were improving despite ongoing pressures from the war in Ukraine, Yellen said the U.S. economy is “fundamentally in good shape.”

“Employment, you know, continues to increase. Households are in good shape. You know, we don’t have balance sheet problems of the type that we had prior to the (2008-2009) global financial crisis,” Yellen said referring to high debt levels and crashing home prices of that era.

UK: -Britain marked the one-year anniversary of the invasion of Ukraine by issuing more sanctions against Russia, including export bans on every item it has used on the battlefield and import bans of iron and steel goods.

Britain has frozen assets and targeted a wave of Russian officials and companies in the last year to cripple Moscow’s economy and curb its ability to wage war on its neighbor.

In a statement on Friday, it said it would target another 92 individuals and entities, including allies of Russian President Vladimir Putin such as the boss of Nord Stream 2, Matthias Warning.

Ahead of a meeting between Group of Seven leaders and Ukrainian President Volodymyr Zelenskiy, Britain said the internationally coordinated sanctions and trade measures would target aircraft parts, radio equipment, and electronic components.

“Today we are sanctioning the elites who run Putin’s key industries and committing to prohibit the export to Russia of every item Russia has been found using on the battlefield,” Foreign Secretary James Cleverly said in a statement.

Other executives to be targeted include those at the state-owned nuclear power company Rosatom and others who work at defense groups and Russian banks.

It will also ban the import of 140 goods including iron and steel products processed in third countries.

“Trade sanctions are working. UK goods imports from Russia have fallen by 99%, since before the invasion, and goods exports to Russia have fallen by nearly 80%,” Business and Trade Secretary, Kemi Badenoch, said.

The meeting of G7 leaders and Zelenskiy is expected to discuss further sanctions on Russia.

Top Economic Releases Today:

USD: Core PCE Price Index (MoM) (Jan) Forecast 0.4%, Previous 0.3% at 19:00
USD: New Home Sales (Jan) Forecast 620K, Previous 616k at 20:30
EUR: German GDP (QoQ) (Q4) Actual –0.4%, Forecast –0.2%, Previous –0.2% at 12:30
JPY: National Core CPI (YoY) (Jan) Actual 4.2%, Forecast 4.2%, Previous 4.0% at 05:00
EUR: German GDP (YoY) (Q4) Actual 0.3%, Forecast 0.5%, Previous 0.5% at 12:30