Markets Off To A Cautious Start, Ahead Of A Busy Week With Central Bank Decisions And Earnings

Expect a busy week ahead as the world’s three largest central banks hold monetary policy meetings and three of the four largest US companies by market capitalization release their quarterly results. And with the Federal Reserve holding its monetary policy meetings on Tuesday and Wednesday, slowing the pace of rates to a smaller 25 basis points from December’s 50 basis points, a shift between the European Central Bank and the Bank of England is expected. . is raising interest rates by 50 basis points at its meeting on Thursday. Friday’s NFP of , will also be watched, with Apple, Amazon, Alphabet and Meta Platforms reporting quarterly earnings this week. , In the US market, major US futures were slightly lower in early session Monday ahead of a busy week of earnings and central bank meetings. Futures for the , Dow Jones Industrial Average lost around 102 points, while futures for the S&P 500 and Nasdaq 100 fell around 0.3 % and 0. 1%, respectively. “Inflation has rocked the Fed upside down; They need to be careful not to accidentally cut rates too early. Don’t buy this bullish bullpen with a few rate cuts in December. The Fed is only being helped by a very unlikely crash. event right now,” David Zervos, chief market strategist at Jefferies, said in a note sent to clients in the announcement. The US dollar traded above an eight-month low in foreign markets. on Monday, as the US dollar index rose about 0.03% to near 101.92 after touching an 8-month low of 101.50: n is close to last week. It is on track for a fourth straight monthly loss of more than 1.5%, the probability that the Federal Reserve is very close to ending its tightening cycle and interest rates may not rise as high as previously thought. , The British pound and the euro were 0.0 % higher and the euro 0.06% higher against the US dollar, respectively, as movements were somewhat muted ahead of the Fed, ECB and BOE monetary policy meetings this week. “We’re changing the business a little bit because the market is trying to gauge how the central banks will behave… I think for all three it’s more about what they say than what they do,” says Rodrigo Catril. Currency Strategist at National Australia Bank (NAB). Oil prices fell on Monday morning, rising as production is expected to remain unchanged at this week’s OPEC meeting and many market participants are closely watching the Federal Reserve meeting. Brent crude futures at , lost about 20 cents to trade near $86. 6 a barrel by 0 35 GMT, while U.S. West Texas Intermediate crude fell about 11 cents to $79.57 a barrel. , Representatives of the Organization of the Petroleum Exporting Countries (OPEC) and allies such as Russia, also known as OPEC, are asking whether they will change their current oil production in their virtual meeting on February 1. However, at the beginning of February, signs of an increase in oil exports from the Baltic ports of Russia sent Brent and WTI into losses during the first three weeks of the past three. “There will be no changes to OPEC production at this week’s meeting and we expect the US Federal Reserve’s outlook comment to be a key driver of the outlook in the short term,” said analysts at National Australia Bank. . Oil prices initially rose due to geopolitical tensions in the Middle East following a drone attack on oil producer Iran and China, one of the world’s largest oil importers, is expected to see growing energy consumption support demand. “It’s not entirely clear what’s going on in Iran, but any escalation there could disrupt the flow of oil,” said Stefano Grasso, senior portfolio manager at 8VantEdge in Singapore. “On the supply side, we have Russia and on the demand side, China. Both can fluctuate by more than a million barrels per day above or below expectations,” adds Grasso, a former oil trader at Italy’s Eni.

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