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Stocks Rallied As Inflation Eased

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STATE OF THE MARKETS

Stocks rallied as inflation eased. US stocks rallied higher on Wednesday after inflation was reported lower in July, sending speculation that the Feds might not raise as much rate as had expected. Subsequently, the Dollar index fell below the 105 handle as major averages surged higher. Small caps Russell (+2.95%) led the rally, followed by the tech-laden Nasdaq (+2.89%), S&P (+2.13%) and Dow (+1.63%). Long term investors however remained cautious as bonds were bought, sending yields lower, before settling relatively unchanged. As at writing, inversions remained to be seen in 1Y (3.29%), 2Y (3.23%), 5Y (2.94%) and the 10Y (2.80%). 

In the commodity markets, Dollar weakness pushed major commodities higher with crude rebounded back above $91/bl while gold surged past $1800/oz before pulling back lower on profit taking. Elsewhere, iron ore however, continues to press lower as global recession continues to weigh on the commodity. It settled 20 cents lower, around $109.60/tn as New York closed.

In the FX space, overall sentiments seemed slightly bullish as demand for Swiss pulled back while Kiwi and Aussie reigned in the helm of demand across all horizons. King Dollar was seen sold off across the board as markets reprice Fed’s hike post inflation data.

On Thursday, markets expect to scoop further bargains as more earnings reports come in from Brookfield Asset Management (BAM), Illumina (ILMN), Rivian Auto (RIVN), Resmed (RMD), Cardinal Health (CAH), Wheaton Metals  (WPM), US Foods (USFD), Dillard’s (DDS) and Applied Industrial Tech (AIT) as well as the latest US jobless claims and Producers Price Index.


G8 CURRENCIES SENTIMENTS

ST NZD AUD JPY CHF EUR GBP CAD USD ST
MT NZD AUD CHF EUR JPY CAD GBP USD MT
LT AUD NZD CHF JPY GBP CAD EUR USD LT
** ST refers to Short-Term daily turnover, MT is Medium Term weekly 
and LT refers to Long-Term monthly turnover.


WALL ST MOST ACTIVE

TICKER LAST PRICE

% CHANGE

VOLUME 90 DAYS AVG
NVTA 8.63 + 276.86 232,039.5K 9,118.3K
TQQQ 36.50 + 8.21 135,719.9K 162,641.3K
SQQQ 35.83 – 8.18 108,729.3K 117,649.6K
AMD 99.05 + 3.67 83,366.2K 101,908.8K
HLBZ 1.48 + 2.78 79,204.7K 5,941.8K
F 15.50 + 3.06 71,642.1K 63,601.0K
CCL 10.34 + 9.19 71,541.5K 47,931.3K
AAPL 169.24 + 2.62 70,074.3K 87,115.2K
SOXL 19.91 + 12.55 69,133.7K 61,207.2K
SPY 419.99 + 2.10 68,633.2K 91,142.8K
** % Change here refers to price vs previous day price


WALL ST TOP FLOWS

TICKER LAST PRICE

VOLUME

% CHANGE FUNDS FLOW $
TSLA 833.07 31,577.5K + 5.05 27,885.1M
AAPL 169.24 70,074.3K – 0.03 11,859.4M
NVDA 180.97 59,681.3K + 9.95 10,800.5M
AMD 99.05 83,366.2K – 7.04 8,257.4M
AMZN 142.69 54,698.3K – 17.62 7,804.9M
MSFT 289.16 24,663.3K – 3.18 7,131.6M
META 178.34 30,225.4K – 4.13 5,390.4M
GOOGL 119.70 30,886.6K – 8.88 3,697.1M
TTD 74.24 42,313.9K + 397.25 3,141.4M
RBLX 48.01 64,768.5K + 170.38 3,109.5M
** % change here refers to volume vs. 20 days average volume.


TOP 5 BLOCK ORDERS

TICKER PRICE TYPE VOL/OI FUNDS FLOW
DKNG 19.35 stock/options 84.80 469.8M
PACB 7.69 stock/options 79.97 92.8M
JMIA 8.20 stocks/options 79.82 84.4M
NQ 33,317.00 DOW futures 2,596 87.0M
YM 13,410.50 NASDAQ futures 6,725 90.7M


OUR PICK – CAD/JPY

Risk sentiments and weaker crude capped Loonie. Sentiments model showed upside remained capped as Loonie tried to rally against Yen in the medium term. We expect crude weakness to continue as the global recession continues to weigh in the minds of investors. Recent IMF projection of a global growth slowdown was not helping sentiments either. Continuous outflow from the equities markets showed that long term investors remain skeptical and prefer to hold cash.

 

HORIZON STRATEGY SL TP1 TP2
Short-Term Sell 104.60 102.80 102.00
Medium-Term Sell 105.20 102.00 101.20
Long-Term Sell 105.20 101.20 100.50

 

Disclaimer:

This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.