Trade overview: current reports, trends, indices, stock prices, bonds, foreign exchange and commodities and analyst recommendations
07:55
Most Asian stock markets are trading in a negative trend today. The Nikkei index in Tokyo falls by about 1%, the Hang Seng index retreats by about 0.3% and the Kospi in Seoul registers a decrease of about 0.8%. On the other hand, Shanghai rises by about 0.6%.
Slight declines are recorded in futures trading on US stock market indices.
● The risk in the S&P 500 is increasing and the signs of imminent declines are increasing
US government bond trading is now stable. This is after sharp increases in long-term government bond yields were recorded there on Friday. The ten-year bond yield increased by 6 points to 3.74% and the two-year bond yield increased by one point to 4.52%.
In the commodity market, oil futures are now down about 1% after rising on Friday following a report that Russia will cut oil output by 500,000 barrels per day in March. This, in response to the sanctions and purchase ban imposed on Russian oil in recent months following the invasion of Ukraine. The Brent rose last week by 8.6% and the WTI type oil recorded an increase of 8.2%.
In the global forex market, the dollar is now trading with a slight increase of about 0.1% against the euro and the pound and is strengthening by about 0.6% against the Japanese yen to a level of 132.1 yen per dollar.
Slight declines are recorded in the crypto arena and at this time Bitcoin is trading around 21.8 thousand dollars and Ethereum has weakened to a level of 1,520 dollars.
● Inflation in the US is expected to moderate, and what is the forecast in Israel?
Today, important macro data will not be published in Israel or in the world. However, the rest of the week is especially full of macro data from the worlds of inflation and growth. The main drama is expected with the publication of the consumer price indices in the USA (Tuesday at 15:30 Israel time) and in the UK on Wednesday.
In the US, it is estimated that the index recorded a monthly increase of 0.4% in January (and an increase of the same rate in the core index that does not include energy and food prices), so that the annual inflation rate decreased from 6.5% in December to 6.2% (and the core rate decreased from 5.7% to -5.5%).On Wednesday morning the index will be published in Great Britain, where inflation is expected to register a decrease of 0.4% in January so that the annual rate will moderate from 10.5% to 10.2%.
And finally, John Mayer, Chief Investment Officer at Global X, notes in his weekly review that “so far, about 70% of the S&P 500 companies have published their reports for the fourth quarter. Overall, the average earnings per share decreased by 11% on an annual basis. This signals a decrease in the rate of growth in the coming year, and this against the background of higher interest rates, higher wage costs, the strong dollar and tax increases. Therefore, we should expect the continuation of efficiency programs among companies, something that may affect the economy at the macro level.”
He also points out that “Fed Governor Powell’s statements about the first signs of a decrease in inflation (disinflation) will be tested this week with the publication of the consumer price index for the month of January. Despite the trend of a decrease in inflation, it is possible to detect an increase in prices in specific sections such as second-hand cars It will be interesting to see the effect on inflation expectations, and this is in light of the fact that the break-even point of inflation for 5 years rose in the last two weeks to 2.4%, but this is still lower than the record of 3.5% recorded in March 2022. The market is now pricing in a final interest rate of 6 %, which shows that there is more work to be done to lower inflation in the US.”