Market Commentary – February 10, 2022

Kevin Jock

10th February 2022

Global stock markets rose on Wednesday, with all the major U.S. indices continue to rally as both the Dow and Nasdaq were up by more than 200 points. Such move was driven by solid corporate earnings which helped to boost investor optimism. Share price of Meta are up for the first day after a series of consecutive losses and all the other FAAMG stocks are gaining as well.

In Europe, we can see that its major stock indices surged on Wednesday as well, encouraged by a number of strong Q4 trading updates, with UK, France and Germany’s major indices all rose by more than 1%. Volkswagen was the top boosts to the index since it was up by 6.1%, on the hope of a possible listing of its luxury brand Porsche AG.

Across Asia, both the ASX 200 and Nikkei 225 indices trading nearly flat during Thursday’s Asian morning session. While HK’s Hang Seng index opened high at the beginning but later plunged into red territory, dipped 0.7% before the mid-day break. Virus cases in Hong Kong continued to break daily record, surged by 1,161 cases yesterday with the HK Hospital Authority estimate that the fifth wave of pandemic could possibly infect 250K people.

Oil price is pretty flat on Thursday morning as investors are now focusing on the outcome of the nuclear talks between U.S. and Iran. Gold prices continue to remain bullish and has thus climbed to $1,832.95 as of yesterday’s close. The Chinese Yuan edged up on today due to corporate demand as the PBoC set the midpoint rate at 6.3599 per dollar before the market open.

image_2022_02_10T05_35_20_689Z

Figure 1 (Source: IS Prime) IDX.EU.50 Daily : STOXX50 fluctuates amid a wide range awaiting further guidance from the ECB whom have continued their dovish front whilst bond markets speak otherwise.

Headliner to Review

  • U.S. crude oil inventories decreased by 4.8M barrels in the week ending Feb 04, which is a dramatic difference as the market expects it to increase by 1.5M barrels.
  • U.S. wholesale inventories increased 2.2% in December, slightly more than the estimation of an increase of 2.1%. This is largely due to a rise of motor vehicle stocks as it increased by the most in 10 years.

Headliner to Watch

  • The governor of the Reserve Bank of Australia (RBA) is due to speak tomorrow, with investors and traders bet that the bank could possibly raise interest rates repeatedly in 2022.
  • UK’s preliminary GDP is projected to expand by 1.1% quarter-on-quarter, the same pace as in Q3 2021 as the local economy has recovered its lost output from the pandemic.

Any opinions, news, research, analysis, prices, or other information contained on this website is provided as general market commentary, and does not constitute investment advice.

Authors:
Antony Tan
Kerry Man