Technical Analysis Report

11 Jul

Technical Analysis Report – 11 July 2022

/ CSFX Analytics

MARKETS CAUTION ON MONDAY DUE TO U.S. INFLATION REPORT

Asia-Pacific stocks were mostly down on Monday morning. The Shanghai Composite is down 1.23% at 3,314.82. Overall, the Singapore MSCI is flat at 289.00. Over in Hong Kong, the Hang Seng Index is down 2.95% at 21,086. In Japan, the Nikkei 225 is up 0.15% at 26,650.00, while the Topix index is up 0.61% at 1906.00. South Korea’s Kospi is down 0.44% at 2,340.27. Australia S&P/ASX 200 down 1.14% at 6602.20.

Top News of the Day:

Caution gripped share markets on Monday as investors braced for a U.S. inflation report that could force another super-sized hike in interest rates and the start of an earnings season in which profits will be under pressure.

Upbeat U.S. June payrolls report already has the market wagering heavily on a rise of 75 basis points from the Federal Reserve, sending bond yields and the dollar higher.

Market Summary as per 08/07/2022:

European equities Friday closing. The DAX futures contract in Germany traded up 1.34% at 13,015.23, CAC 40 futures down 1.59% at 5936.89 and the UK 100 futures contract in the U.K. down 0.87% at 7,119.20.

In the U.S. on Wall Street, the Dow Jones Industrial Average closed down 0.15% at 31338.16. The S&P 500 down 0.08% at 3899.37 and the Nasdaq 100 up 0.14% at 12125.69, NYSE closes down 0.23% at 14642.32.

Top Market News Today:

In the Forex market, GBPUSD down 0.43% at 1.1974. The USDJPY up 0.66% at 136.942. The USDCHF up 0.38% at 0.9799. EURUSD down 0.53% at 1.0132, EUR/GBP up 0.06% at 0.8463. The USD/CNY up 0.27% at 6.7129 at the time of writing.

In the Commodity market U.S. Gold futures down 0.14% at $1,739.39. Elsewhere, Silver futures down 0.37% at $19.220 per ounce, Platinum down 1.51% at $883.50 per ounce, and Palladium down 1.86% at $2146.00.

Crude Oil down on Monday; Brent Crude Oil down 1.52% at $105.38 per barrel while U.S. West Texas Intermediate (CLc1) down 1.77% at $100.47.

In the Cryptocurrency Markets, Bitcoin at 20335.00 down 6.57%, Ethereum down 2.05% at 1142.61, Litecoin at 50.85 down 2.51%, at the time of writing.

Top Market Segment to Watch Out Today:

AMAZON: German union Verdi has called on staff at seven Amazon (NASDAQ:AMZN) distribution centres to strike over Sunday evening’s night shift in a bid to force the retailer to accept the union’s sectoral collective bargaining agreement.

Economic News:

US: The U.S. Treasury on Friday said it was moving to terminate a 1979 tax treaty with Hungary in the wake of Budapest’s decision to block the European Union’s implementation of a new, 15% global minimum tax.

A Treasury spokesperson said that since Hungary lowered its corporate tax rate to 9% – less than half the 21% U.S. rate – the tax treaty unilaterally benefits Hungary.

“The benefits are no longer reciprocal – with a significant loss of potential revenues to the United States and little in return for U.S. business and investment in Hungary.”

The timing of the termination following years of U.S. concerns about the treaty suggests that Treasury is using it to try to pressure Hungarian Prime Minister Viktor Orban to agree to implement the 15% global minimum tax agreed by nearly 140 countries.

Affirming the Hungarian government’s position, Foreign Minister Peter Szijjarto said that the global minimum tax would ruin Europe’s competitiveness and endanger jobs in Hungary.

Eurozone: The biggest single pipeline carrying Russian gas to Germany started annual maintenance on Monday, with flows expected to stop for 10 days, but governments, markets and companies are worried the shutdown might be extended due to war in Ukraine.

The Nord Stream 1 pipeline transports 55 billion cubic metres (bcm) a year of gas from Russia to Germany under the Baltic Sea. Maintenance lasts from July 11 to 21.

Last month, Russia cut flows to 40% of the pipeline’s total capacity, citing the delayed return of equipment being serviced by Germany’s Siemens Energy, in Canada.

Canada said at the weekend it would return a repaired turbine, but it also said it would expand sanctions against Russia’s energy sector.

Europe fears Russia may extend the scheduled maintenance to restrict European gas supply further, throwing plans to fill storage for winter into disarray and heightening a gas crisis that has prompted emergency measures from governments and painfully high bills for consumers.

German Economy Minister Robert Habeck has said the country should confront the possibility that Russia will suspend gas flows through Nord Stream 1 beyond the scheduled maintenance period.

Top Economic Releases Today:

U.K. BRC Retail Sales Monitor (YoY) (Jun) today at 19:01 this time estimated -1.2%, previously which was -1.5%.
JAPAN PPI (MoM) (Jun) today at 19:50 this time estimated 0.5%, previously which was 0.0%.
AUSTRALIA NAB Business Confidence (Jun) today at 21:30 previously which was 6.
AUSTRALIA Westpac Consumer Sentiment (Jul) today at 20:30 previously which was -4.5%.
GERMANY Buba President Nagel Speaks today at 12:30.