July 16, 2022
  • July 16, 2022

LIVE MARKETS More than four

By on January 27, 2022 0
  • European stocks fall 1.3%
  • The Fed is expected to raise rates in March
  • US futures in the red

January 27 – Welcome home to real-time market coverage from Reuters reporters. You can share your thoughts with us at [email protected]

MORE THAN FOUR (0801 GMT)

The world’s largest economy is expected to register GDP growth at a 37-year high of 5.5%, with data due later on Thursday. Some, like JPMorgan, estimate that figure could be as high as 7.5%. We will also likely see weekly jobless claims fall further.

Join now for FREE unlimited access to Reuters.com

Register

This, in a nutshell, is why the US Federal Reserve believes there is “quite a lot of room to raise interest rates.”

Could there be more than four rate hikes this year? Powell didn’t deny the possibility, so markets began pricing in a fifth move.

As a result, two-year Treasury borrowing costs hit 23-month highs, narrowing the gap with 10-year yields. And on Treasuries, the segment of debt with the shortest maturity, Tradeweb notes a strong accentuation, the spread between three- and six-month yields being the highest since 2015, and more than double compared to the period of a month ago.

A similar steepening is noticeable between the other maturities of the bonds, a sign that the price is tighter.

Thus, the stock market sell-off that had eased before the Fed is back, with global equities down 0.6%; The Europeans and Wall Street are ready for another fall.

But if buyers are scared, there are bargain hunters of a different kind – billionaire William Ackman said he’s bought $1 billion worth of Netflix stock since Thursday’s market crash.

Companies, meanwhile, continue to deliver good news; Tesla, for example, predicted growth of more than 50% this year, while Deutsche Bank posted its biggest profit since 2011. But with buyers still hidden, Tesla shares fell in after-hours trading. Office.

Reuters Charts

Key developments that should further guide markets on Thursday:

-Chinese industrial companies saw their December profits grow at the slowest pace in a year and a half

– German consumer sentiment improves slightly

– New Zealand inflation at its highest in three decades Read more

-South Africa is expected to hike rates by 25 basis points

-US Durable Goods/Advanced Q4 GDP Statement/Early Unemployment Insurance Claims

– Auction of American 7-year banknotes

– US profits: Blackstone, Dow Chemicals, Southwest Airlines, McDonalds T Rowe Price, Mastercard, JetBlue, Apple, Visa, Mondelez

-European results: LVMH, Dr Martens, UniCredit Britvic, St. James’s Place, STMicro, SAP, Deutsche Bank, IG Group, Diageo, Sabadell, SEB, Polymetal

(Sujata Rao)

*****

DOWN (STRONGLY) WE GO AGAIN (07:30 GMT)

Relief from an unsurprising Federal Reserve statement lasted only about 8 minutes yesterday, but after that brief initial spike, Wall Street headed south in wild swings that brought the Dow Jones and the S&P indices in negative territory.

“Risk assets … reversed once Chairman Powell started talking. Investors deduced that his biggest concern was being behind the curve, and that policy will be tightened faster than we never thought so before.” said Ian Williams, analyst at Peel Hunt.

And global markets are taking notice. In Asia, stocks fell to their lowest level in almost 15 months and European stocks are expected to follow with futures down 1.4-2.1%. Meanwhile, US contracts indicate that the sale should extend to a second day.

The Federal Reserve said it was likely to raise interest rates in March and reaffirmed its intention to end its bond purchases that month in what U.S. central bank chief Jerome Powell said. promised to be a sustained battle to control inflation. Read more

(Danilo Masoni)

*****

Join now for FREE unlimited access to Reuters.com

Register

Our standards: The Thomson Reuters Trust Principles.