STATE OF THE MARKETS
Stocks tumbled amid flight to safety . US stocks tumbled on Monday as investors were spooked by the protests in China that could spark global recession fears as the economy reverts amid new lockdowns. The small cap Russell (-2.05%) fell the most, followed by Nasdaq (-1.58%), S&P (-1.54%) and Dow (-1.45%) as investors flock to bond’s safety, sending yields lower across the board. The shorter 2Y fell under 4.43% while the 10Y benchmark fell to 3.62% as safe haven demand pushed the Dollar back above the 106.65 mark.
In the commodity markets, global recession fears pushed crude oil lower to $73.60/bl before bidders stepped in and settled the black gold higher near $76.50/bl as New York closed. Dollar strength continued to weigh on gold that was under pressure and closed below $1,741.30/oz. Elsewhere, iron ore continues to stall around the $93/tn handle as markets wait for the next catalysts.
In the FX space, overall sentiments were mixed as demand for safe haven Yen remained elevated across the board alongside Aussie and Kiwi. Short term traders were quick to sell the overbought Sterling, while continuing to demand Euro. King Dollar remained in the offers alongside Swiss and Loonie.
On Tuesday, markets expect to be defensive ahead of the GDP and employment data later this week. Earnings releases to watch includes Intuit (INTU), Bank of Nova Scotia (BNS), Workday (WDAY), CrowdStrike (CRWD), Hewlett Packard (HPE) and NetApp (NTAP) as well as consumer confidence and Case-Schiller home price index.
OUR PICK – No New Pick
We stay on the sideline for now. With two trades stopped out recently – Crude Oil and NZD/USD – and choppy markets ahead of the NFP Friday, we decided to stay on the sideline for now.
Disclaimer: This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.