⏰Wall Street braces for tomorrow’s Fed meeting and big-tech earnings
US100 erased early losses and rose over 1.0% during today's session as traders are still weighing bets about whether the FED will ease its tightening path on Wednesday and bracing themselves for reports from 4 US mega-tech companies, which are expected to create a lot of volatility. Meta Platforms will be the first of those with a report coming out on Wednesday after the close of the Wall Street session. Q4 financial reports from Alphabet, Amazon and Apple will follow a day later, on Thursday (also after the close of the Wall Street session).
Meanwhile, the Fed on one hand is expecting slow rate hikes to 25 bps, while upholding its hawkish rhetoric, even though most likely we will not see a series of hikes, but only 2 moves by 25 bp. Fed's Waller, known for his rather hawkish comments, stated that interest rates will be at restrictive levels if they are 1.5-2.0% higher above the inflation estimate at the end of the year. The Fed indicates that inflation will slow down to 3.1% at the end of the year. In this case, the restrictive level would be assessed in the range of 4.5-5.0%, which means that in March we may see the end of the tightening cycle.
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile appAlso fresh data reinforced expectations that FED will raise rates only by 25 bps on Wednesday. The Bureau of Labor Statistics report pointed to a further slowdown in labor costs, while Chicago PMI and US Conference Board Consumer Confidence index both contracted in January. Recent data shows that hikes are taking a toll on the economy, the question is how far FED is willing to go?
US100 bounced off support at 11,860 points, which is marked with the lower limit of the 1:1 structure and managed to return above the 100 EMA, as well as above the psychological resistance at 12,000. pts, which may herald a [potential resumption of the upward trend. Source: xStation5
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
