Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

<b> MARKET</b> ANALYSIS <b> MARKET</b> ANALYSIS

MARKET ANALYSIS

Cutting-Edge Market Commentary for Informed Strategy Making

WEEKLY OUTLOOK 05.12.2022 - 09.12.2022


Over the weekend, some cities in China eased travel restrictions, raising hopes of an easing of the government's strict zero-Covid policy as Chinese business activity shrunk for the third consecutive month. Apple's top supplier, Foxconn, predicts that with the new softer covid containment rules, it will be able to run the Zhengzhou plant at full capacity in four weeks.

With signs of a reopening from China, the world's largest oil importer, and after OPEC+ kept production stable at Sunday's meeting after cutting production by 2 million barrels/day in October, prices of oil went up. Russia is considering cutting supplies after the G7 and Australia imposed an oil price cap of $60 a barrel on the country's seaborne crude exports.

On the equity front, in the current conditions, the announcement of the increase in dividends for Pfizer is very likely.

While Fed members can't speak ahead of their last 2022 meeting on Dec. 13-14, investors are still gathering clues as to how aggressive the central bank might be after four consecutive rate hikes. The main event this week on Friday is US Producer Price Inflation PPI data from the US with the YoY year-over-year increase expected to cool to 7.20% from 8.00%. On the other hand, statements by Fed Chairman Powell last week that a possible slowdown in rate hikes that had so excited stock markets was coming, were contradicted by Friday's employment report which showed that hiring is remained strong in November and that average wages had increased. The second clue this week is Thursday's Weekly report of initial jobless claims predicting a slight 5K increase. Some 70% of traders still expect the Fed to slow rate hikes to 50 basis points in December, down from 75 basis points at the previous four meetings. According to Goldman Sachs, hikes of 25 basis points should follow in February, March and May, bringing the rate to a peak of 5-5.25%.

As for the other central banks, the expectation for the Central Bank of Australia is that on Tuesday it will decide for a rise of 25 basis points from 2.85%, a rise that has narrowed after the sharp slowdown in inflation in October . It is therefore not certain that the Australian dollar will be weighed down as it would benefit more from the reopening of China than from such an increase.

On Wednesday, however, the BoC is expected to see an increase of 50 basis points to which would be added the 350 basis points increase since March.

In view of the last meeting of 2022, the president of the ECB, Madame Lagarde, will issue statements on several occasions which could in turn predict what the atmosphere will be at the meeting on 15 December. Last week, data showed a larger-than-expected fall in eurozone November inflation, and therefore the expectation of the hike will be 50 basis points, lower than the previous series of hikes of 75 basis points.

The economic week ends with the corollary of the PMI data, and the Trade balances, as well as with the Oil Inventories and the EIA Short-Term Energy Outlook. On Friday afternoon, operators will also have to take into account the data processed by the University of Michigan which will outline Consumer Expectations and Sentiment as well as the evening Rig count.


Monday 05 December

Time CET

Val.

Event

Expected

Previous

01:30

JPY

Services PMI (Nov)

50

50

02:45

CNY

Caixin Services PMI (Nov)

48

48.4

02:45

EUR

ECB President Lagarde Speaks

09:55

EUR

German Services PMI (Nov)

46.4

46.5

10:00

EUR

Services PMI (Nov)

48.6

48.6

10:30

GBP

Services PMI (Nov)

48.8

48.8

11:00

EUR

Eurogroup Meetings

15:45

USD

Services PMI (Nov)

46.1

46.1

16:00

USD

ISM Non-Manufacturing PMI (Nov)

53.1

54.4


Tuesday 06 December

Time CET

Val.

Event

Expected

Previous

04:30

AUD

RBA Interest Rate Decision (Dec)

3.10%

2.85%

04:30

AUD

RBA Rate Statement

14:30

USD

Exports

258.00B

14:30

USD

Imports

331.30B

14:30

USD

Trade Balance (Oct)

-79.10B

-73.30B

14:30

CAD

Exports (Oct)

66.37B

14:30

CAD

Imports (Oct)

65.23B

14:30

CAD

Trade Balance (Oct)

1.00B

1.14B

16:00

CAD

Ivey PMI (Nov)

51

50.1

16:30

AUD

RBA Rate Statement

18:00

USD

EIA Short-Term Energy Outlook

22:30

USD

API Weekly Crude Oil Stock

-7.850M



Wednesday 07 December

Time CET

Val.

Event

Expected

Previous

01:30

AUD

GDP (QoQ) (Q3)

0.70%

0.90%

04:00

CNY

Exports (YoY) (Nov)

-3.60%

-0.30%

04:00

CNY

Imports (YoY) (Nov)

-5.00%

-0.70%

04:00

CNY

Trade Balance (USD) (Nov)

79.05B

85.15B

06:00

JPY

Leading Index (MoM) (Oct)

-3.80%

06:00

JPY

Leading Index

98.4

97.5

08:00

GBP

Halifax House Price Index (MoM) (Nov)

-0.20%

-0.40%

08:00

EUR

German Industrial Production (MoM) (Oct)

-0.50%

0.60%

11:00

EUR

GDP (QoQ) (Q3)

0.20%

0.20%

16:00

CAD

BoC Rate Statement

16:00

CAD

BoC Interest Rate Decision

4.25%

3.75%

16:30

USD

Crude Oil Inventories

-2.758M

-12.580M

16:30

USD

Cushing Crude Oil Inventories

-0.841M

-0.415M


Thursday 08 December

Time CET

Val.

Event

Expected

Previous

00:50

JPY

GDP (QoQ) (Q3)

-0.30%

-0.30%

01:30

AUD

Exports (MoM) (Oct)

7.00%

01:30

AUD

Imports (MoM) (Oct)

01:30

AUD

Trade Balance (Oct)

11.750B

12.444B

13:00

EUR

ECB President Lagarde Speaks

14:30

USD

Initial Jobless Claims

230K

225K

19:00

EUR

ECB President Lagarde Speaks


Friday 09 December

Time CET

Val.

Event

Expected

Previous

02:30

CNY

CPI (MoM) (Nov)

0.10%

02:30

CNY

CPI (YoY) (Nov)

1.60%

2.10%

02:30

CNY

PPI (YoY) (Nov)

-1.50%

-1.30%

14:30

USD

Core PPI (YoY) (Nov)

5.90%

6.70%

14:30

USD

Core PPI (MoM) (Nov)

0.20%

0.00%

14:30

USD

PPI (YoY) (Nov)

7.20%

8.00%

14:30

USD

PPI (MoM) (Nov)

0.20%

0.20%

16:00

USD

Michigan Consumer Expectations (Dec)

55.3

55.6

16:00

USD

Michigan Consumer Sentiment (Dec)

57

56.8

19:00

USD

U.S. Baker Hughes Oil Rig Count

627

19:00

USD

U.S. Baker Hughes Total Rig Count

784



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