A combination of rising Bond Yields and increased tensions in Ukraine saw U.S. Equity Markets closed lower yesterday, led by the NASDAQ 100 which finished the session with a loss of 1.92%. Russian delegate Leonid Slutsky said recent progress in negotiations could lead to a written document on their positions in the coming days, raising optimism of a diplomatic solution. U.S. Deputy Secretary of State Wendy Sherman added that Russia looks like it’s now showing signs of willingness to negotiate. This sparks optimism that the military conflict could end soon. This also led to a decline in oil prices, which helped ease inflation fears after crude’s recent surge higher. This optimism was tempered later in the day, after White House press secretary Jen Psaki said that the U.S. had not seen any indication that Russia was open to an agreement. Markets did not hold onto their early morning gains for long… Throughout the afternoon, equities sold off sharply. There were concerns that the Chinese lockdowns in Shenzhen could impact the supply chain, with companies like Apple (AAPL) supplier Foxconn and automakers Toyota and Volkswagen halting their operations in the region. This could make the current supply-chain situation even worse, as Shenzhen is one of the largest ports in the world, while ongoing supply-chain disruptions would mean persistently higher inflation. Investors are waiting for Wednesday’s Federal Reserve policy release. Wall Street is expecting a 25 basis-point rate hike, but everyone will keep an eye on clues for the timeline of future rate hikes. Some banks are seeing as many as seven this year, so any commentary on a measured approach could be a bullish sign for investors. The financial sector was one of the outperformers today, as rising bond yields implied higher margins for banks. Apple was a huge drag on tech names (and markets overall, given its massive weighting in indexes) after one of its key suppliers had to shut down operations because of COVID lockdowns in China. Investors continued to sour on Netflix (NFLX), driving its shares to the lowest level since March 2020. Within the S&P 500 Index, seven of the 11 sectors finished lower. European Markets closed higher. Russian energy giant Gazprom said it’s still continuing delivering gas to Europe at pre-conflict levels, implying that the European Union is not yet seeing a shortage of energy. The U.K. is set to invest heavily in increasing solar energy generation, as well as building a second nuclear plant, to reduce reliance on energy from other sources. The International Monetary Fund said it was likely that Russia will default on its debt, but added that this won’t trigger a global financial collapse. European Union leaders were said to have pledged $2.2 trillion in new defense spending to protect their countries from any new military threats or energy disruptions. In Asia, China’s government implemented a lockdown in the port city of Shenzhen, potentially worsening supply-chain disruptions. The White House said that Russia had officially asked China for military help in its military conflict in Ukraine. Chinese tech giant Tencent was reportedly set to receive a record fine from the government for money-laundering violations, increasing concerns of China’s crackdown on tech companies. This led to a sharp sell-off in Chinese tech, dragging those listed in Hong Kong to their worst day since 2008. South Korean President-elect Yoon Suk-yeol was said to take a hardline stance to negotiations with North Korea, adding that the country will invest in new missile defenses to protect from an attack. Elsewhere, Oil fell 7% on optimism that Russia and Ukraine were making progress, implying that Russian energy supply wouldn’t be taken out of the market, while Gold closed 1.9% lower as Treasury yields increased, giving investors a yield-providing safe haven.
To mark my 2500th issue of TraderNoble Daily Commentary I am offering a special 2-Year Rate of Euro 2750 for my Platinum Service which includes 1 to 4 updated emails throughout the trading day to demonstrate this value, a monthly subscription over the same period would cost 4440 euro in total This offer represents a 38% discount and is open to both new and existing members. If anyone is interested in this offer can you please email me on bryan@tradernoble.com for details
For anyone following my Platinum Service it made 481 points yesterday and is now ahead by 2835 points for March. The Platinum Service made an impressive 5324 points gain in February, after ending January with a gain of 3878 points, more than making up for December’s 932 points loss, having made 2466 points in November, 1028 points in October, 2866 points in September, 1543 points in August, and 996 points in July. The Platinum Service made 1366 points in June, 1439 points in May, 1244 points in April, after ending March with an impressive gain of 3769 points. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
Equities
The S&P 500 closed 0.74% lower at a price of 4173.
The Dow Jones Industrial Average closed 1 point higher for a 0.01% gain at a price of 32,945.
The NASDAQ 100 closed 1.92% lower at a price of 13,046.
The Stoxx Europe 600 Index closed 0.4% higher.
This morning, the MSCI Asia Pacific Index fell 0.3%.
This morning, the Nikkei closed 0.15% higher at a price of 25,346.
Currencies
The Bloomberg Dollar Spot Index closed 0.5% higher.
The Euro closed 0.6% lower at $1.0913.
The British Pound closed 0.5% lower at 1.3015.
The Japanese Yen fell 0.7%, closing at $117.45.
Bonds
Germany’s 10-year yield closed 11 basis points lower at 0.35%.
Britain’s 10-year yield closed 10 basis points lower at 1.60%.
US 10 Year Treasury closed eight basis points higher 2.11%.
Commodities
West Texas Intermediate crude closed 7% lower at 102.16 a barrel.
Gold closed 1.9% lower at $1942.10 an ounce.
This morning on the Economic Front we already had the release of U.K. February Jobless Claims which fell 48.1K versus -35K expected. At 10.00 am we have the German and Euro-Zone ZEW Survey. This is followed by U.S. PPI and the New York Empire State Manufacturing Index at 12.30 pm. Finally, we have a speech from ECB President at 2.15 pm.
Cash S&P 500
My S&P plan worked well on Friday with the market trading lower to my 4210 initial buy level before rallying to my 4225 revised T/P level as emailed to my Platinum Members. Subsequently, I emailed them again to buy the S&P at 4199 before we rallied to my 4220 T/P level and I am now flat. The S&P made a rebound high at 4247, before getting slammed into the close. This sell-off has continued overnight with the S&P now trading at 4149- well below the key 4175/4200 support zone. The S&P is now stuck between potential escalation versus potential de-escalation as the magic search goes on trying to figure out what is priced in and what is not priced in in terms of technicals, flows and Month and Quarter End considerations. On top of this we have a Fed Meeting tomorrow, followed by Fed Chair Powell’s press conference. My hunch is that we will get some sort of agreement between Russia and Ukraine over the coming days. This will see the S&P fly higher which will give us a decent rally that works off some of these oversold conditions which can then give us a new sell set-up. Bond Yields are rising which is no surprise as QE is now over for now. The Fed are trapped as they hate uncertainty. I just cannot see them hike more than 25 basis points in this environment despite Inflation at a 40-year high. The S&P has support at last month’s 4105 low print. This level must hold. I will be an aggressive buyer from 4090/4120 with no stop. Ahead of the Fed Meeting, I do not want to be short the S&P at this time.
EUR/USD
The Euro is rallying as I go to post. I will now raise my sell level to 1.1060/1.1120 with a higher 1.1175 stop.
March Dollar Index
I am still flat the Dollar which is selling off this morning. Ahead of tomorrow’s Fed Meeting, I will now lower my buy level to 97.60/98.20 with a wider 95.95 stop.
Cash DAX
No Change. I am still a buyer on any dip lower to 13530/13630 with the same wider 13395 stop.
Cash FTSE
Overnight, the FTSE traded lower to my 7090 buy level. I am still long and I will add to this trade at 7030 with the same 6975 stop. I will now lower my T/P level to 7030 and if any of the above levels are hit, I will come back with a new update for my Platinum Members.
Dow Rolling Contract
I am still flat. The Dow is struggling to make much progress above the 33000 area. However, ahead of the FOMC tomorrow, I am reluctant to go short. The Dow has strong support from 32500/32200 and I will now lower my buy level to this area with no stop for now. The ‘’Fear & Greed’’ Index closed with a reading of 16 last night, with the same ‘’Extreme Fear’’ print. Remember, a reading below 10 will be a strong buy signal for U.S. Indexes. If I am taken long the Dow, I will have a T/P level at 32750.
Cash NASDAQ 100
The NDX traded the whole of yesterday’s buy range for a now 13075 average long position. I will now lower my T/P level to 13150 while leaving my 12895 tight stop unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
June BUND
The Bund traded lower to my 161.50 buy level. I will add to this trade at 160.80 while leaving my 159.95 stop unchanged. I will now lower my T/P level to 161.80 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
Gold Rolling Contract
My Gold plan worked well with the market trading lower to my 1955 buy level before rallying to my 1965 T/P level and I am now flat. Gold is getting hit hard this morning, trading at 1930 as I go to press. Anyone who bought Gold over the last three weeks are now trapped long. Gold has support from 1890/1910 where I will be a strong buyer with no stop for now. If I am taken long, I will have a T/P level at 1928.
Silver Rolling Contract
My Silver plan worked well with the market trading lower to my 24.90 buy level before rallying to my 25.21 revised T/P level and I am still flat. Silver has support from 23.50/24.10 where I will an aggressive buyer with no stop.
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