Daily Market Bulletin – 1 March 2022
Market Developments
Sentiment appears to be at a better place today, as market continue to digest the war in Ukraine and upbeat factory data form China.
Yesterday's peace talks between Russia and Ukraine concluded with no major breakthrough. The leader of the Russian delegation though, is willing to negotiate for as long as it takes to clinch agreement, as reported by Russian news agency TASS [1]. Ukranian President Zelenskyy accused Russia of continuing to bomb his country during those negotiations [2].
Energy giant Shell, announced on Tuesday that it will exit its joint ventures with Russian Gazprom and related entities [3]. The move comes after rival BP had said it would be selling its nearly 20% stake in Rosneft.
Mastercard issued a statement on Monday, saying it had blocked multiple financial institutions from its payment network, as a result of sanctions against Russia [4].
China's factory activity expanded in February, as Manufacturing (PMI) was 50.2 vs 49.9 forecast, 50.1 in January.
The Reserve Bank of Australia kept rates unchanged at 0.1% as expected today and acknowledged the war in Ukraine as a new source of uncertainty for the global economy. The bank reiterated its patience around monetary policy and that it will not increase the cash rate until actual inflation is sustainably within the 2%-3% target range. [5].
Zoom announced Revenue growth of 21% year-over-year to $1.071 billion in Q4 FY2022 (period ended January 2022), while in Q3 it had registered growth of 35% year-over-year to $1.050 billion [6]. Forward guidance for Q1 FY2023 was underwhelming, as the firm projects Revenue of $1.070-$1.075 billion. The stock dropped after-hours, following the results.
EV startup Lucid, reported Revenue of $26.4 million for the fourth quarter of 2021. It delivered 125 cars during that period, while total deliveries exceed 300 units. It also cut its 2022 production target to 12,000-14,000 vehicles, from 20,000 previously, due to "extraordinary supply chain and logistics challenge" [7]. The stock slumped after-hours, following the report.
Main Asia-Pacific stock markets were upbeat, European futures follow suit and US 10YR Yields rise.
Safe-haven Japanese Yen is soft and the US Dollar is mixed, while the Australian Dollar gains against the greenback.
Instruments Snapshot
EUR/USD is subdued around 1.1200.
GBP/USD trades with positive undertone above 1.3400.
USD/JPY is mixed as it erases earlier gains, but tries to hold 115.00.
USD/CAD is soft, threatening 1.2650.
AUD/USD extends its advance towards 0.7300.
NZD/USD rebounds form its poor start to the day, having defended 0.6750.
GER30 finds buying interest and reclaims 14,400.
US30 is upbeat, trying to take 34,000 out.
USOIL is on the offensive, testing 97.50
XAU/USD is cautious around 1.905.
Economic Calendar Picks (GMT)
Its PMI day today, with readings from Germany (08:55), Eurozone (09:00), UK (09:30), Canada (14:30) and USA (14:45 & 15:00).
We also expect Germany's preliminary CPI Inflation (13:00) and GDP figures from Canada (13:30).
Overnight, focus shifts to US President Biden State of the Union Address (02:00) and Australia's Q4 GDP (00:30).
On the earnings front, US retailer Target and Chinese tech firm Baidu report before US markets open today.
See the economic calendar here.
Nikos Tzabouras
Senior Market Specialist
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.
With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.
References
| Retrieved 01 Mar 2022 https://tass.com/politics/1413465 | |
| Retrieved 01 Mar 2022 https://www.youtube.com/watch | |
| Retrieved 01 Mar 2022 https://www.shell.com/media/news-and-media-releases/2022/shell-intends-to-exit-equity-partnerships-held-with-gazprom-entities.html | |
| Retrieved 01 Mar 2022 https://www.mastercard.com/news/press/2022/february/mastercard-statement/ | |
| Retrieved 01 Mar 2022 https://www.rba.gov.au/media-releases/2022/mr-22-05.html | |
| Retrieved 01 Mar 2022 https://investors.zoom.us/news-releases/news-release-details/zoom-video-communications-reports-fourth-quarter-and-fiscal-1 | |
| Retrieved 04 Jun 2023 https://ir.lucidmotors.com/news-releases/news-release-details/lucid-announces-fourth-quarter-and-full-year-2021-financial |
Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interests arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed here.