5 Keys to Wall Street By Investing.com


©Reuters

By Geoffrey Smith

Investing.com – The Federal Reserve begins its two-day meeting with markets in turmoil, struggling to digest a 75 basis point hike in benchmark interest rates. The advance of the dollar against the yen and the euro stops after the Japanese finance minister admitted his concern and one of the most aggressive members of the ECB again gave his arm to twist. The US PPI data for May could change the situation in the short term. Cryptocurrencies remain under great pressure after the Celsius Network crash. OPEC publishes its monthly report on the oil market. Oracle (NYSE:) surprises for good with its quarterly results. Here are the top five things to watch out for this Tuesday, June 14, in the financial markets.

1. Markets are unsettled awaiting the start of the Fed meeting

The Federal Reserve begins a two-day monetary policy meeting in an increasingly confused market environment.

The market consensus has quickly shifted to expecting a 75 basis point hike in the fed funds rate on Wednesday, following another painful spike in consumer inflation in May. Producer price inflation data for the month is due out at 2:30 PM ET and is likely to consolidate these expectations, with a consensus forecast of another strong 0.8% price rise from April. .

On Monday, the yield on 10-year Treasury bonds rose the most so far this year as investors scramble to price in interest rate risks. At 3.32%, it now trades at roughly the same level as bond yields, having briefly broken above that level on Monday. A sustained period in which short-term interest rates trade above long-term rates has historically been a reasonably reliable predictor of recession.

2. Cryptocurrencies still under pressure after Celsius lockdown

The cryptocurrency space remains under pressure after one of the biggest multifunctional players in the space, Celsius Network, suspended withdrawals due to a liquidity crisis on Monday.

Prices hit a fresh 18-month low of $20,859 at the start of trading in Europe on Tuesday, before recovering a bit to settle at $22,307 by 12:05 PM ET. This figure is still 7.5% lower than that of Monday’s day in New York. Caution remains the order of the day as market participants are aware that MicroStrategy, a de facto leveraged Bitcoin fund, faces a margin call on a $205 million loan if the price falls by under $21,000.

Looking on the bright side, the world’s leading cryptocurrency exchange by volume, Binance, was able to resume withdrawals after temporarily suspending them on Monday.

3. Stocks Point to a Dead Cat Rally at the Open

US stock markets point to a dead cat rally at the open on Tuesday, after a start to the week that smacks of capitulation.

At 12:10 AM ET, shares were up 55 points, or 0.2%, while shares were up 0.3% and {{8874|100 futures}} were up 0.6. %. Benchmark spot indices had lost between 2.8% and 4.7% on Monday.

The small business optimism index prepared by the has fallen from 93.2 to 93.1 points, an 18-month low, although it is still a smaller drop than that observed in recent months.

Stocks likely to command attention on Tuesday include Oracle, whose quarterly report beat expectations on Monday, and Apple (NASDAQ:), which is once again under fire from EU antitrust regulators. For their part, cryptocurrencies remain in the spotlight: MicroStrategy falls 5.4% before the opening; Coinbase (NASDAQ:) 1.5%.

4. The advance of the dollar stops after the declarations of Japan and the ECB

The dollar halted its rise against the euro and the yen, after Japan’s finance minister admitted concerns about currency weakness and hawkish members of the European Central Bank reignited the fight for a half-point rise in interest rates in July.

Dutch central bank governor Klaas Knot said in an interview with French newspaper Le Monde that the ECB should raise rates by more than the 25 basis points indicated in its forecast last week.

At the time, the ECB had left the door open for more drastic action in September, but committed to a “gradual” and “data-driven” approach over the summer.

5. Oil rises; the monthly report from OPEC and the API is expected

Crude oil prices rise ahead of the monthly report from the Organization of the Petroleum Exporting Countries (OPEC), to be released at 1:45 PM ET. His forecast of demand from China will be of particular interest, in view of the new outbreaks of Covid-19 in Beijing and Shanghai that threaten to trigger a new wave of mobility restrictions.

A Beijing government spokesman had previously said the city had to do “everything possible” to control an outbreak linked to a particular bar.

By 12:25 AM ET, futures were up 0.6% at $121.62 a barrel, while the futures were up 0.7% at $123.06 a barrel.

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