Beat the street: US inflation data steers US indices down, USD up
Despite earnings from Coca-Cola already today and the prospect of Q4 numbers from both Lyft and Airbnb after the bell it’s all about US CPI.
In the event it came in stronger than expected and has sen the dollar rise against all other currencies. This is taking down equities and gold.
(AI Video Summary)
Fed unlikely to cut rates in March
In today's edition of "Beat the street", Jeremy Naylor talks about what's happening in the stock market and the latest news about consumer prices. He mentions that the Federal Reserve is unlikely to cut interest rates in March, but it might happen in May. He also points out that some stocks, especially those on the Nasdaq, have been underperforming.
One example he gives is Coca-Cola, which saw a decrease in sales in the fourth quarter because they raised their prices. This affected their demand, particularly in North America. Next, he discusses the EUR/USD trade and how the euro is getting weaker compared to the US dollar. He explains that this could result in the euro reaching its lowest point since 14 November. He also talks about how this could impact interest rates.
US tech stocks may have lower start
Moving on to the US markets, Naylor predicts that tech stocks, like those on the Nasdaq, will have a lower start. He mentions that the Dow Jones is also experiencing a slight decline, but it's not seen as a big deal. He describes the current market situation as being priced for perfection, but not actually getting it.
Strong dollar impact on gold and Bitcoin
The video then touches on the impact of the stronger dollar on commodities, such as gold and Bitcoin, which have seen declines. The German DAX 40 is also going down because of higher-than-expected US inflation numbers.
Earnings reports and market performances
He then mentions that upcoming earnings reports from companies like Airbnb and Lyft are being anticipated. They expect Airbnb's stock price to rise, while Lyft's is decreasing. Technical analysis is provided for both stocks.
Other stocks, like Boeing and Procter & Gamble, are highlighted for their market performance. The influence of the stronger dollar on oil prices is also discussed. Naylor mentions that OPEC predicts strong oil demand with no signs of consumption peaking.
To wrap things up, the video summarises the market's reaction to the US inflation numbers and predicts a lower start for the US markets. Naylor expects the euro-dollar trade to continue weakening and note the impact of the stronger dollar on other currencies and commodities.
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