2023/01/05 (142.005) Technical Analysis – XETR-SIE & CBOT

Dow 300 Points Lower Ahead Of Tomorrows Labour Market Report
– That´s Why, Due To High Volatility Tomorrow, Don`t Trade Without Stops

US WallStreet Extend Losses On Thursday Ahead Of Labour Market Report Tomorrow On Friday
– In Focus Were Amazon, Bed Bath & Beyond, Silvergate Capital And/Or Walgreens Boots Alliance

A still robust US labor market increased investors’ fears of a further aggressive monetary policy course by the Fed on Thursday. On Wall Street, the three most important indices, the Dow Jones, S&P 500 and Nasdaq 100, all fell again. Among the individual stocks, some stocks fell by double digits. According to the private service provider ADP, 235,000 jobs were created in the US private sector in December. Analysts had only expected 150,000 new jobs. A robust job market can mean rising wages and, as a result, continued high inflation. This could prompt the US Federal Reserve to raise interest rates more than previously expected. The official US labor market report for December, which will be published on Friday, is now decisive for the Fed. The technology selection index Nasdaq 100 slipped 1.59% to 10,741 points. The leading index Dow Jones lost 1.02% to 32,930 points and/or the market-wide S&P 500 fell by 1.16% to 3,808 points.

Among the individual values, several papers recorded price losses in the double-digit percentage range. The shares of the bank Silvergate Capital, which specializes in fintechs and cryptocurrencies, fell by 42 percent. According to the Californians, the crypto market crash triggered by the FTX scandal triggered such a run on the bank’s deposits that Silvergate was forced to sell assets at large losses and lay off 40 percent of its staff. The negative industry news also covered the papers of the crypto exchange Coinbase with a minus of around ten percent. Bed Bath & Beyond slipped 29 percent after the household goods retailer doubted its continued existence. According to the company, it is still considering all strategic alternatives to improve the financial situation – including the sale of parts of the business. Shares in brewer Constellation Brands fell by around nine percent due to weak Q3 figures. The US company continues to struggle with rising costs, which are weighing on margins and offsetting growth in its core business. Walgreens Boots Alliance shares in the Dow Jones fell to their lowest level since late October. The titles of the drugstore and pharmacy chain did not benefit from an increase in this year’s sales outlook. Rather, investors were disappointed that Walgreens only confirmed the profit outlook. As the weakest value in the leading index, the titles lost 6.1 percent at the end of trading. Amazon shares hit the headlines with the largest wave of layoffs in the online retailer’s history. CEO Andy Jassy announced in a memo to employees that more than 18,000 jobs would be cut. The Internet retailer’s papers lost around 2.4 percent. They have been in a downtrend since last August.The frontrunner in the Dow Jones, however, was the Chevron share with a plus of 1.8 percent. The papers benefited from good news from Venezuela. With a price increase of a good six and a half percent, the papers from Western Digital made a positive impression. As the Bloomberg news agency reported, citing circles, the memory manufacturer is again in talks about a merger with Japanese competitor Kioxia. However, it was also said that the negotiations are still at an early stage and could end without an agreement. T-Mobile US shares gained around three percent. The Telekom subsidiary surprisingly increased the number of contract customers in the fourth quarter. As expected, the number of new customers is strong, wrote UBS analyst John Hodulik. The churn rate was the lowest it had ever been in a fourth quarter.

DXY Approaches 105 While US 10-Year Treasury Yield Consolidates Above 3.7%

The dollar tested the 105 neighborhood for the first time in three weeks as investors digested a slew of job market data that paved the way for an aggressive Federal Reserve. Stronger-than-forecasted ADP and JOLTs Job Openings figures, coupled with a decline in jobless claims numbers, pointed to a still-tight labor market, which, in turn, fueled bets that rates would have to move even higher to cool the economy. Now, all eyes turn to the nonfarm payroll report on Friday for clues about the next move in interest rates. On the policy side, minutes from the FOMC December meeting also echoed this view, with policymakers committed to pushing rates higher and holding them at a restrictive level until there were clear signs that inflation was easing. This dollar’s strength was seen across the board, with some of the most pronounced buying activity against the GBP and risk-sensitive currencies such as the AUD and/or NZD.

The US 10-year Treasury note yield, seen as a proxy for global borrowing costs, consolidated above 3.7% as investors digested minutes from the FOMC December meeting. Policymakers confirmed their previous hawkish signals that interest rates must continue to rise and remain at a restrictive level for a prolonged period to bring inflation down to target. However, investors are not blindly buying this tightening narrative, with speculation about a recession prompting bets that the Federal Reserve will cut rates later this year. Some sectors of the US economy, including housing and industry, have already flashed recessionary signs. Now, all eyes turn to the nonfarm payroll report on Friday for clues about the next move in interest rates.US Trade Gap Lowest in Over 2 Years One Day Ahead Of US Unemplyment Data, So That Wall Street Tumbles

The US trade deficit narrowed to $61.5 billion in November of 2022, the lowest since September of 2020, and below forecasts of a $73 billion gap. It reflected a decrease in the goods deficit of $15.3 billion to $84.1 billion and an increase in the services surplus of $1.0 billion to $22.5 billion. Total exports were down 2% to $251.9 billion, led by falls in sales of natural gas, crude oil, nonmonetary gold, civilian aircraft and travel while shipments rose for pharmaceutical preparations, telecommunications, computer, and information services and charges for the use of intellectual property. Meanwhile, imports of goods and services declined 6.4% to $313.4 billion, due a broad-based decrease, namely pharmaceutical preparations, cell phones, crude oil, passenger cars, computers and travel. The deficit with China decreased $5.8 billion to $20.4 billion and the gap with the EU narrowed $3.6 billion to $19.5 billion.

US stocks closed sharply lower on Thursday as strong employment results added leeway for more interest rate hikes by the Federal Reserve. Data from ADP showed that 235 thousand private-sector jobs were added in December, well above estimates, while initial jobless claims surprised to the downside. The results further backed evidence of a stubbornly tight labor market after JOLTS Job Opening figures yesterday also surpassed expectations, backing the hawkish rhetoric unveiled in the FOMC’s latest meeting. Per the document, Fed policymakers warned markets to not expect a dovish pivot any time soon, adding that it hampers the transmission of monetary tightening. The Dow closed 300 points lower and the S&P 500 lost 1.2%. The rate-sensitive Nasdaq underperformed and lost and 1.4%, quickly approaching levels last seen in July 2020. Amazon fell over 2% after the e-commerce giant said it plans to shed more than 18,000 jobs, while Microsoft extended its selloff to slide nearly 8% this year.