Traders Market Weekly: Only a Sheep Lets Himself be Sheared

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    The global equity markets outside of China are off to strong starts. S&P Futures are up about 48 points to trade around the 4240 area. The market saw modest buying early on and has maintained positivity throughout the session. Spoos are sitting just off the high of 4244.75. The psychological 4200 area held as support with the low print put in at 4200.25.

    In Asia, China and Hong Kong saw considerable sell-offs while Japan gained 0.6%. The Shanghai (-2.6%) and Hang Seng (-5%) saw sentiment turn sour. These markets suffered from early selling as they processed the weaker than expected lending data released after the markets were closed on Friday. Rising coronavirus cases took their toll as well. In Japan, the Nikkei was led higher by automotives, semiconductors and financials. As such, Honda, Toyota, Tokyo Electron, Advantest, Mitsubishi UFJ Financial and Mizhuo Financial rose 1-3%.

    In Europe, the major bourses are trading higher. Volkswagen (+6.5%) is leading European automakers after reporting its fiscal year results. Peers such as BMW, Stellantis and Mercedes-Benz Group are up 4% in sympathy.


    S&P Futures vs Fair Value: +47.0
    10 yr Note: 2.084%
    USD/JPY: 117.81 +0.48
    EUR/USD: 1.0961 +0.0046
    Europe: FTSE: +0.3% DAX: +2.5% CAC: +0.9%
    Asia: Hang Seng: -5.0% Shanghai: -2.6% Nikkei: +0.6%
    Gold (1968.00 -17.00) Silver (25.75 -0.41) Crude (105.01 -4.32)


    Key factors driving the futures market:

    Russia and Ukraine report progress in their talks
    Oil prices drop on hope of potential ceasefire agreement
    Treasury yields rising as inflation concerns, and rate-hike concerns, persist
    China dealing with COVID outbreak, puts Shenzhen, a major technology hub, in lockdown mode until March 20, creating more worries about supply chain constraints
    Russia threatening to seize assets of U.S. companies halting/closing business there
    FOMC meeting on Wednesday; Fed is expected to raise the target range for the fed funds rate by 25 basis points

    Berkshire Hathaway (BRK.B) continues to add to Occidental Petroleum (OXY) stake
    Foxconn, an Apple (AAPL) supplier, suspends operations in Shenzhen
    Chinese stocks continue to unravel on concerns about possible de-listing in U.S.
    Pfizer (PFE) CEO says fourth coronavirus vaccine will be necessary, according to CBS News
    Uber (UBER) adding fuel surcharge on each trip or Uber Eats order


    Research calls of note:
    Upgrades: UL, DB, ENVA, FTV, NOK
    Downgrades: OXY, TSN, AEP, CVX, IPG, OMC


    Equity Markets—

    Japan’s Nikkei: +0.6%
    Hong Kong’s Hang Seng: -5.0%
    China’s Shanghai Composite: -2.6%
    India’s Sensex: +1.7%
    South Korea’s Kospi: -0.6%
    Australia’s ASX All Ordinaries: +1.1%


    Equity Markets—

    STOXX Europe 600: +0.8%
    Germany’s DAX: +2.3%
    U.K.’s FTSE 100: +0.2%
    France’s CAC 40: +1.5%
    Italy’s FTSE MIB: +1.6%
    Spain’s IBEX 35: +1.2%


    The Hang Seng plunged 5.0% with many stocks facing de-listing possibility in U.S. getting hit hard.

    Hong Kong, along with mainland China, also had to battle with COVID concerns. China has put Shenzhen in a lockdown mode, suspending all non-essential business until March 20. That is impacting Apple supplier, Foxconn, while COVID remediation issues in general are weighing on the casino operators and many tech stocks. Worries about a slowdown in China continue to fuel expectations that policy stimulus will be provided.


    ^^^ +1 @ good market news posts above …
    Spring has returned after strong cold front
    (12F + snow in mtns of SW VA yesterday)

    GAS has finalized stabilized at $4.43 average for REGULAR
    FED will hopefully only raise 25bps as gas prices alone will slow down economy
    Stocks also off to a flat opening … and unfortunately the horrific war continues
    Still we all have think “+” and make best of things where we are 🙂


    GAS PRICES are so bad — that even TOM BRADY had to come out of retirement – lol 😉 🙂


    Dow 32,945.24 1.05 0.00%
    S&P 500 4,173.11 -31.20 -0.74%
    Nasdaq 12,581.22 -262.59 -2.04%
    GlobalDow 3,869.67 -8.66 -0.22%
    Gold 1,955.30 -29.70 -1.50%
    Oil 102.05 -7.28 -6.66%


    Market Updates

    S&P Futures vs Fair Value: -20.0
    10 yr Note: 2.109%
    USD/JPY: 117.95 -0.25
    EUR/USD: 1.0998 +0.0056
    Europe: FTSE: -1.5% DAX: -2.3% CAC: -2.4%
    Asia: Hang Seng: -5.7% Shanghai: -5.0% Nikkei: +0.2%
    Gold (1933.20 -27.60) Silver (24.98 -0.32) Crude (97.44 -5.51)


    The global equity markets are mostly lower. The weakness in the US on Monday appears to be spilling over to the overnight landscape. S&P Futures are down about 20 points to trade around the 4144 area. The market attempted an early rally that peaked out at 4182.75. Since then, spoos have seen steady pressure. A small bounce to the current level was seen after hitting the low of 4129.50.

    In Asia, China and Hong Kong fell hard for a second straight day while Japan closed slightly higher. The economic slate was active during the session. China’s Industrial Production topped consensus at 7.5%. February Retail Sales also beat forecasts with a print of 6.7%. The Unemployment Rate may have been troublesome, rising to 5.5% compared to the projection of 5.1%. The lockdown of the city of Shenzhen due to the surge in COVID-19 cases likely overwhelmed sentiment causing the erosion of the markets. In Japan, Auto makers were among the best performing classes with Toyota, Subaru and Nissan advancing 2-5%.

    In Europe, the major bourses are under heavy pressure. The resurgence of coronavirus cases in China has caused weakness in travel-related names. Air carriers such as Lufthansa and Air France KLM are down 2-3%. Commodity stocks have fallen out of favor with the recent retreat in underlying metals and energy prices. Miners such as Glencore and Antofagasta are off by 3-4%, while oil stocks like BP and Shell have slid 2-3%.


    Wake-Up Call Briefing

    S&P 500 futures 0.4% above fair value; Nasdaq 100 futures 0.4% above fair value; DJIA futures 0.4% above fair value
    Key factors driving the futures market:
    Lingering sense that sentiment is overly negative and that market is due for a nice near-term bounce
    Ongoing hope that Russia and Ukraine can reach a ceasefire agreement soon
    Big fallout in Chinese markets (Hang Seng down 5.7% and Shanghai Composite down 5.0%) driving more domestic buying interest
    Sharp drop in oil prices (WTI -8.3% to $94.49/bbl) tempers some inflation worries, but the offset is that the drop is due to global growth concerns

    Fed begins two-day FOMC meeting; policy decision and updated economic projections due Wednesday at 2:00 p.m. ET
    China says it wants to avoid U.S. sanctions related to Russia-Ukraine conflict
    More cities in China employ lockdown techniques to deal with COVID case surge; Europe cases rising, too, as BA.2 variant takes root
    Delta (DAL), United (UAL), and Southwest (LUV) offer improved Q1 revenue outlooks on improved leisure travel trends
    Coupa Software (COUP) down 28% after disappointing with guidance; keeps pressure on high-beta stocks
    LME imposes 15% daily price movement limit on all metals


    Research calls of note:
    Upgrades: ZM, GDRX, GWW, HTLD, MOS
    Downgrades: COUP, NKTR, HRL



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