Spreadex Market Update
Record Tesla Profits Help Shore Up Stocks – US Data On Watch Today
Equities Choppy Ahead of US Data
Equities markets are still very much in limbo ahead of the Fed next week. A better showing in the US yesterday, linked to bumper results from Tesla, was not echoed globally. Despite USD remaining weak on Thursday, stock sentiment is still quite muted in the UK and Europe though we did see some recovery off yesterday’s lows in the FTSE and the Dax The Nikkei continues to be the strongest performer this week, up almost 3%. However, stocks might see more action today with key US data due (GDP & durable goods).
Tesla Records Best Quarter Ever
Tesla helped US stocks climb off the lows yesterday with the company reporting its best ever quarterly results. At $24.32 billion, Tesla’s Q4 profits were almost 4% higher than the same period a year prior and beat the $24.16 billion Wall Street was looking for. The company outlined plans to ramp up production across 2023, despite concerns over the global economic outlook. Looking to today’s earnings schedule we have further big names with the likes of Visa, Mastercard and Intel due to report earnings.
Aussie Remains Firm Following CPI Shock
AUD remains strong on Wednesday bolstered by a fresh uptick in RBA tightening expectations on the back of stronger-than-forecast inflation this week. While the RBA has been opting for smaller hikes recently and clearly wanted to head towards a pause in tightening, recent data shows that the bank might well have to step up the pace of hikes once again.
BOC Signals Rates Pause
Yesterday’s BOC rates meeting saw the bank hiking rates from 4.25% to 4.50%, in line with expectations. On the back of the hike, the bank has signalled that it will likely hold off on further rate hikes while it assesses the impact of tightening. CAD was seen lower on the back of the meeting and remains soft today.
Gold Rally Pauses – Crude Still Muted
In the metals and commodities space, gold and silver are both starting the day a little softer on Thursday following decent gains yesterday. Gold prices were seen breaking out to fresh highs on the year as the Dollar pushed lower. Today’s US data has the potential to drive fresh buying in metals if further USD materialises. Crude futures continue to hold just below recent highs for now following choppy action yesterday. The latest EIA report on Wednesday showed a build of just 0.5million barrels, below the 1.2 million the market was looking for and down sharply from the prior week’s 8.4 million build. However, crude is being curtailed by fresh recession fears amidst weaker economic outlooks from key US companies.
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