Beat the street: Traders pause ahead of key week for US earnings, central banks, and jobs

Traders also eye signals from the Fed and the Bank of England. Oil price volatility spikes after a drone attack on US forces in Jordan added to Red Sea tensions.

(AI Video Summary)

"Magnificant Seven" tech earnings could affect VIX

In today's "Beat the street" video, Angeline Ong talks about important market events and trading opportunities in a way that even beginners can understand. She starts by mentioning that big tech companies like Meta, Microsoft, Apple, Alphabet, and Amazon will release reports that could affect the market's momentum. She also highlights the need to keep an eye on oil prices due to tensions in the Middle East.

Ong then moves on to analyse the volatility index (VIX), and switches over to Axel Rudolph who predicts that the remaining five stocks from the "Magnificent Seven" group (the biggest stocks in the S&P 500) reporting their earnings could increase market volatility. He suggests that if the VIX rises above its previous high of $14.84, it could lead to a spike in the index, similar to what happened in December and January. He also mentions the possibility of the VIX hitting the 200-day moving average at around $16.86. To manage risk, he advises setting stop-loss orders below the recent lows between December and January.

US earnings analysis with Josh Fabian

Next, the video switches to a live interview with Josh Fabian from tastylive, part of IG Group, where he and Ong discuss the upcoming busy week in the US earnings calendar, focusing on companies like Amazon, Apple, Meta, and Google. Fabian notes that the market already has high expectations for these tech stocks, and their outlooks for the rest of the year are important. They briefly touch on the tensions in the Middle East and how they could impact oil prices.

Fed interest rate decision

The video also covers central bank actions, with the Federal Reserve expected to maintain interest rates and its balance sheet reduction plan. The forecast for the Fed's GDP growth in 2024 is 1.4%, and the jobless rate is expected to average around 4.1%. The Bank of England is also likely to keep interest rates unchanged, although there are signs of possible lower borrowing costs.

Red Sea attacks impact on oil prices

Lastly, Ong briefly mentions recent drone attacks in the Red Sea and explains how they could affect oil prices. She mentions that so far, disruptions to oil supply have been limited, but the market may start factoring in the risk of more disruptions following the attack on a fuel tanker operated by Trafigura.