Short recap
JP higher on weaker JPY, rest of Asia mixed
EU opened higher
US indices didn’t keep the gains on Trump disappointment as he was short of details about his plans on tax overhaul and infrastructure
Open to immigration reform deviating from campaign rhetoric
Top US and CN officials discussed trade and economy
US growth slowed a bit but consumer spending strong
US PCE, next week NFPs and few Fed speakers left – crucial for March hike
Brexit – banks will have 12-18 months for transition
Will see how it goes as they push for 5 year period
Fiat Chrysler facing diesel emissions allegations on some models
Volkswagen paid USD 2.9 bln to buy back 138k diesel cars in US
EU Commission more flexible on changes in Telecom sector
Apple doing marketing with USD 50 bln paid last year to US based suppliers (like 3M, Corning…etc.)
Stocks trading at record highs on new iPhone expectations
Salesforce.com revenue up 27%
Opel-Peugeot – GM searching for opportunities, not mentioning sale of Opel
TransCanada withdrew its legal case against US over stopping Keystone XL (USD 15 bln)
Valeant looking at further revenue decline in 2017 amid competition. The company is still struggling under enormous debt burden, likely the sales of non-core assets may not be sufficient.
US banks with record profits last year
Fidelity Investments and Charles Schwablowering trade commissions to zero
Another war in brokerage field boiling?
10 yr US Trys yield at 2.42%
10 yr Bund yield at 0.21%
USD supported by rising Mar 15 hike expectations not the Trump talk
Now at 78% above 70-75% for Fed to move
Other sources say 65/70%
Fed Williams March hike “up for serious consideration”
Room to go:
DXY towards 102.00/12 (high from Nov)
10 yr US Trys yield towards 2.52% (range 2.30/2.52%)
If DXY moves higher, stocks should have the room too
Fed hike can be further catalysator
Will see whether further US data and remaining Fed speakers will seal the deal
EURUSD – as mentioned before the 1.0500-20 level a battleground
USDJPY – 115.00 and Ichimoku ahead of us
Data
Wed:
UK: Manufacturing PMI – expected slightly higher (close to three year high)
US: PCE inflation expected at 1.7%, hitting of 1.8% or above will be a strong signal for Fed to move in March
US: Consumer spending – expecting 0.3% increase
US: Personal income – expecting 0.3% higher
ISM Manufacturing – expecting no change
Fed’s Kaplan, Brainard speaking
Beige Book
Thu:
Fed’s Mester speaking
Fri:
US: ISM Non-manufacturing activity index – expecting no change
US: NFPs only next week on Mar 10
Fed’s Yellen, Evans, Lacker, Powell, Fisher speaking
Should you have any questions feel free to contact me anytime.
Good luck Champs!
Mr Hawk
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