An uneasy calm
STOXX 600 down 0.1%
HSBC up, BP down after results
EZ CPI picks up, core slows
U.S. stock edge down
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AN UNEASY CALM (0947 GMT)
April was a steady month for equity markets despite several "uncomfortable" risks lurking in the background.
Investors are concerned about the stability of the banking system, a deteriorating geopolitical landscape and a weaker corporate earnings picture. But according to Adam Singleton, head of investment solutions at Man FRM, there isn't enough in any of these narratives yet to set a definitive course for markets.
"Everywhere one looks, there is an uneasy calm," Singleton writes.
"When uncertainty is high, we should expect short, sharp periods of higher volatility (regardless of source), and therefore remaining liquid and nimble enough to capitalise on opportunities as they arise seems like a sensible position," he says.
With most hedge fund managers primed for something to go wrong, Singleton says an uneasy situation for hedge funds could be a market where banking crises are contained, the debt ceiling issues get resolved, there are no material negative geopolitical developments, inflation falls back towards target and corporate earnings improve.
"While not exactly a 'pain trade', the slightly uncomfortable trade for some of the hedge fund industry might be this Goldilocks path through the rest of 2023," Singleton writes.
STOXX STEADIES AS BANK GAINS OFFSET OIL DRAG (0746 GMT)
European shares were little changed in early trading on Tuesday, with gains in banks ahead of another likely rate hike from the ECB this week offsetting a drop in oil stocks on the back of weaker crude prices. Results from energy heavyweights also came in play.
HSBC HSBA.L rallied 4.5% after Europe's biggest bank rewarded shareholders with its first quarterly dividend since 2019 following strong numbers. BP BP.L declined almost 5% after the oil major cut its share buyback programme.
The region-wide STOXX 600 .STOXX was flat on the day. The overall picture across country benchmarks was mixed, while the DAX .GDAXI was also little changed after briefly surging to its highest since January 2022.
EUROPE SET FOR POSITIVE START (0649 GMT)
European shares were set to kick off a big week for central bank meetings, up slightly after JPMorgan agreed to buy First Republic Bank assets to help solve the third U.S. banking crisis in two months.
EuroSTOXX50 and FTSE 100 futures rose around 0.2-0.3%respectively, while S&P 500 futures were last just above parity, pointing to a muted start later on Wall Street. The Fed is expected to hike rates by 25 basis points on Wednesday before pausing, while the ECB policy decision is due on Thursday.
In corporate news, earnings continue to dominate the scene. HSBC HSBA.L shares were called up 2-3% in London after Europe's largest bank beat quarterly profit expectations and announced a new cycle of share buybacks for up to $2 billion.
Eyes also on BP BP.L after the UK oil major made a $5 billion profit in the first quarter, topping expectations, although it pared back a share buyback programme. Numbers to digest also from Logitech LOGN.S, AMS-OSRAM AMS.VI and Geberit GEBN.S, among the others.
Electrolux ELUXb.ST was on the watchlist too after reports of an approach from China's Midea Group for a potential acquisition of the Swedish brand.
RBA SHOCK HIKE STARTS HUGE WEEK FOR CENTRAL BANKS (0553 GMT)
The Reserve Bank of Australia kicked off a string of major central bank meetings this week by surprising markets with a quarter-point rate hike, when most had been positioned for a pause. It even signalled the possibility of more tightening to come, jolting the Aussie to a one-week high.
The Fed is up tomorrow, followed by the ECB the next day, all while the Bank of Japan's decision on Friday to remain a dovish outlier continued to reverberate in FX markets, knocking the yen to a fresh 15-year low against the euro.
Japan markets will be shut for public holidays for the next three days, missing not just the Fed and ECB decisions but Friday's monthly U.S. payrolls report as well.
The ECB is among the most hawkish of the major monetary authorities and is expected to raise rates for a seventh straight meeting. The debate among policy makers is whether to opt for another half-point hike or slow to a quarter-point pace.
The Fed, meanwhile, is widely expected to hike rates by a final quarter point and then signal a pause. Money markets are still betting on a Fed rate cut before the end of the year.
Treasury yields were ticking down in Asia with risks from the debt ceiling standoff ramping up. President Joe Biden has called for a meeting with top congressional leaders amid warnings the U.S. may run short of cash around June 1, earlier than the market had been estimating.
Asian stocks were lower, pressured by weakness in financial shares in Tokyo, Sydney and Hong Kong after the seizure of First Republic Bank by regulators rekindled worries about the U.S. banking sector.
JPMorgan will pay $10.6 billion to the FDIC as part of a deal to take control of most of First Republic's assets while gaining access to its coveted wealthy client base.
The White House said the lender was "severly mismanaged", suggesting problems are not systemic in the second biggest bank failure in U.S. history. Biden repeated a call for stronger rules and oversight.
Meanwhile, changes may be in the offing for the Fed's board, with the New York Times reporting that Biden is likely to nominate current governor Philip Jefferson to be vice chair and World Bank economist Adriana Kugler as a governor.
Key developments that could influence markets on Tuesday:
Euro-area CPI data
U.S. JOLTS report
Wall Street earnings including Pfizer ahead of the open, and Starbucks and Ford after the bell
الأصول ذات الصلة
إخلاء المسؤولية: تتيح كيانات XM Group خدمة تنفيذية فقط والدخول إلى منصة تداولنا عبر الإنترنت، مما يسمح للشخص بمشاهدة و/أو استخدام المحتوى المتاح على موقع الويب أو عن طريقه، وهذا المحتوى لا يراد به التغيير أو التوسع عن ذلك. يخضع هذا الدخول والاستخدام دائماً لما يلي: (1) الشروط والأحكام؛ (2) تحذيرات المخاطر؛ (3) إخلاء المسؤولية الكامل. لذلك يُقدم هذا المحتوى على أنه ليس أكثر من معلومات عامة. تحديداً، يرجى الانتباه إلى أن المحتوى المتاح على منصة تداولنا عبر الإنترنت ليس طلباً أو عرضاً لدخول أي معاملات في الأسواق المالية. التداول في أي سوق مالي به مخاطرة عالية برأس مالك.
جميع المواد المنشورة على منصة تداولنا مخصصة للأغراض التعليمية/المعلوماتية فقط ولا تحتوي - ولا ينبغي اعتبار أنها تحتوي - على نصائح أو توصيات مالية أو ضريبية أو تجارية، أو سجلاً لأسعار تداولنا، أو عرضاً أو طلباً لأي معاملة في أي صكوك مالية أو عروض ترويجية مالية لا داعي لها.
أي محتوى تابع للغير بالإضافة إلى المحتوى الذي أعدته XM، مثل الآراء، والأخبار، والأبحاث، والتحليلات والأسعار وغيرها من المعلومات أو روابط مواقع تابعة للغير وواردة في هذا الموقع تُقدم لك "كما هي"، كتعليق عام على السوق ولا تعتبر نصيحة استثمارية. يجب ألا يُفسر أي محتوى على أنه بحث استثماري، وأن تلاحظ وتقبل أن المحتوى غير مُعدٍ وفقاً للمتطلبات القانونية المصممة لتعزيز استقلالية البحث الاستثماري، وبالتالي، فهو بمثابة تواصل تسويقي بموجب القوانين واللوائح ذات الصلة. فضلاً تأكد من أنك قد قرأت وفهمت الإخطار بالبحوث الاستثمارية غير المستقلة والتحذير من مخاطر المعلومات السابقة، والذي يمكنك الاطلاع عليه هنا.