Daily Market Bulletin – 17 February 2022

Market Developments

Investors are on edge as they monitor the developments around Ukraine, Iran and digest Fed's minutes.

Sentiment took a hit overnight, after reports of Ukrainian government forces opening fire against Russian-backed rebels. [1]

On Tuesday, Russia had announced withdrawal of some troops from near the border with Ukraine, but western countries and NATO have refuted this. Yesterday, ABC News reported that a senior White House official told it that Russia has increased its presence along the Ukrainian border by as many as 7,000 troops in the last few days, with some arriving Wednesday. [2]

On the Iran nuclear talks, hopes for an agreement rose after Iran's top nuclear negotiator, Ali Bagheri Kani twitted on Wednesday: "After weeks of intensive talks, we are closer than ever to an agreement; nothing is agreed until everything is agreed, though". [3]

On Wednesday, minutes from the Fed's January policy meeting showed that participants expected "it would soon be appropriate" to hike rates, but no mention of size and the US dollar was pressured, as they appeared less hawkish than markets expected. [4]

On the data front, the Australian economy added 12.9K jobs in January, from +64.8K in the prior month, while Unemployment steadied at 4.2%.

European plane maker Airbus announced its financial results earlier today and reported Revenue of €52.149 billion in 2021, 4% higher over the previous year, while having delivered 611 commercial aircrafts. For 2022 it projected a rise to 720 deliveries. [5]

Australian telecoms giant Telstra saw its Profit (NPAT) fall 34% year-over-year, to A$0.7 billion in the half-year ended December 32 (H1 FY22), whereas Underlying Earnings (EBITDA) grew 5.1% y/y. to A$3.5 billion.

On the 5G front, CEO Mr Penn commented that Telstra's network was now more than twice the size of its next nearest competitor, with more than 77.5% of the population covered. TLS.au shed more than 4% after today, after the financial results.

Nvidia reported record Revenue of $7.64 billion in Q4 FY2022, up 52% from a year ago and 8% higher the previous quarter. The company offered strong guidance for the next reporting quarter (Q1 FY2023), seeing Revenue $8.10 billion, plus or minus 2 percent. [7]

Last week, Nvidia had abandoned the acquisition of chip designer Arm due to regulatory challenges and expects to record losses of $1.36 billion from the relevant write-off.

Main Asia-Pacific stocks mixed and European futures try to react. On the FX front, the Japanese Yen is upbeat, while the US Dollar is mixed, erasing earlier gains.

Instruments Snapshot

EUR/USD is soft but reclaims 1.1350, after earlier drop.

GBP/USD is mixed as it covers earlier losses, but cannot leave 1.3600 behind it.

USD/JPY retreats, but defends 115.00.

USD/CAD is upbeat and returns above 1.2700.

AUD/USD lacks firm direction below 0.7200, as it pares earlier losses.

NZD/USD rejected 0.6900 earlier, but stays in profits for third straight day.

GER30 is on the back foot but reclaims 15,300.

US30 trades with caution and tests 34,800.

USOIL rebounds towards 93.00, despite Iran talks optimism.

XAU/USD extends Wednesday's gains, trying to surpass 1,875.

Economic Calendar Picks (GMT)

Markets await US Jobless Claims (13:30) and Japan's CPI Inflation (23:30) in a data-light day.

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

1

Retrieved 17 Feb 2022 https://www.reuters.com/world/europe/ukraine-rebels-accuse-govt-forces-mortar-shelling-report-2022-02-17/

2

Retrieved 17 Feb 2022 https://abcnews.go.com/Politics/live-updates/russia-ukraine/

3

Retrieved 17 Feb 2022 https://twitter.com/Bagheri_Kani/status/1494035061007650818

4

Retrieved 17 Feb 2022 https://www.federalreserve.gov/monetarypolicy/files/fomcminutes20220126.pdf

5

Retrieved 17 Feb 2022 https://www.airbus.com/sites/g/files/jlcbta136/files/2022-02/EN-Press-Release-Airbus-FY2021-Results_0.pdf

7

Retrieved 25 Jun 2022 https://nvidianews.nvidia.com/news/nvidia-announces-financial-results-for-fourth-quarter-and-fiscal-2022

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