Market Reports by GulfBrokers - 2023

Global stocks stay flat while gold prices reversed from the fresh monthly high as markets took a deep breath ahead of Federal Reserve Chair Jerome Powell’s congressional testimony. The overall risk mood is quite tepid as investors wait for Powell’s speech for further clues about the ongoing pace of the U.S. central bank’s rate hikes. Powell is set to speak today at 15:00 GMT, two weeks ahead of the March FOMC meeting.

Federal Reserve policymakers will need to raise interest rates higher and keep them there longer to tackle the higher prices caused by sticky inflation, San Francisco Fed President Mary Daly said Saturday.

EQUITIES

Chinese shares traded lower after Beijing has disappointed global financial markets by establishing a relatively low economic growth target for 2023. China set a five per cent GDP growth estimate for the year compared to its 5.5 per cent target. Meanwhile, Wall Street ended higher on Monday as investors still expecting the Federal Reserve to ease up on its aggressive monetary policy tightening later this year.

OIL

Crude oil futures were mostly steady so far today after reaching the highest levels in over five weeks. The key data for the oil prices this week will once again be the weekly crude inventory report, movement of the US dollar and FED policymaker's comments.

CURRENCIES

In the currency market, the EURUSD slightly reversed from the recent highs following the release of better-than-expected German Factory orders data. Factory orders in Germany increased 1% in January, beating market forecasts of a 0.9% fall. On the other hand, the Australian dollar remains one of the weakest currency pairs of this week, and the AUDUSD extend the slide during the European session after the RBA decision.

GOLD

The safe-haven metal hovers near the daily session lows. As of this writing, the precious metal trades are below $1846. The expected trading range for gold today is between 1830 support and 1865 resistance. Moving ahead to the North American session, the gold investors should closely monitor the comments from the FED chair Powell.

Economic Outlook

On the data front, the Reserve Bank has raised interest rates for the 10th straight meeting in a row. The central bank increased the cash rate by 25bps to 3.6% at its March meeting. RBA Governor Philip Lowe said the tighter squeeze remained necessary to push down inflation, signalling that even higher rates will be needed in 2023.

“The board expects that further tightening of monetary policy will be needed to ensure that inflation returns to target and that this period of high inflation is only temporary,” RBA Governor Philip Lowe said.

Technical Outlook and Review

EURUSD:
For today, the key resistance is located above $1.0720, a break above this level will confirm a possible move to 1.0770. On the downside, if the pair loses the 1.0640 handles, then we expect a move of 1.0600 and 1.0570.



The important levels to watch for today: Support- 1.0640 and 1.0600 Resistance- 1.0695 and 1.0720.

GOLD: For today, the first nearest support level is located at 1842. In case it breaks below this level, it will head towards the next support level which is located near 1835 then 1830. On the upper side, 1855 will act as an immediate and strong hurdle while 1860 will be a critical resistance zone.



The important levels to watch for today: Support- 1842 and 1835 Resistance- 1855 and 1860.

Quote of the day - “The price of a commodity will never go to zero. When you invest in commodities futures, you are not buying a piece of paper that says you own an intangible of a company that can go bankrupt.” Jim Rogers.
Read more - https://gulfbrokers.com/en/daily-market-report-627
 
Shares of the streaming television pioneer, Roku (NASDAQ: ROKU) retreats back to nearly $60 last week, but again the stock found new buyers near the $60 area and rebounded back to above $65. Therefore, the long-term price action of the trend continues to show signs that the stock is still, and the recent price reversal is likely due to price retracement before another aggressive upside move.

Roku shares plunged more than 80% in 2022. Throughout last year, the company’s stock price has been aggressively bearish, which had been a result of pressure caused by several factors, including the rising fed rates to over 4.5 percent. One of the other reasons was declining revenue growth and facing growing competition from other popular streaming platforms like Netflix, Amazon Prime, Disney+ and more.

Roku shares strongly started this year; the stock surged almost 42% in January. The upside momentum boosted after the company gained millions of new customers, the company ended 2022 with more than 70 million accounts globally, adding nearly 5 million in the final quarter of the year. The positive news pushed the stock to the highest levels since September.

ROKU Q4 earnings review​

The company released its Q4 and fiscal year 2022 results last month. ROKU reported a smaller-than-expected loss for its fourth quarter while the revenue came above Wall Street estimates. Total revenue for the quarter came in at $867.1 million, compared to $865.3 million during the same period a year ago. The company reported fourth-quarter platform revenue of $731.3 million, up 5% year-over-year. During the quarter, total streaming hours reached 23.9 billion, up 23% year over year.



“Despite a difficult macro environment in 2022, we made excellent progress building on our platform, brand, and industry leadership with the addition of nearly 10 million net new active accounts – ending the year with 70 million active accounts globally”. “Importantly, we plan to continue to improve our operating expense profile to better manage through the challenging macro environment," Roku said in a letter to shareholders.

Should you buy the Roku stock now?​

Though Roku has demonstrated good revenue numbers and customer growth it also faces hard competition from other social media platforms. However, if the company can provide positive earnings reports in coming quarters it will help to boost investor confidence and increase the upside momentum. Therefore, we are likely to see the streaming video platform stock trade above $80 within the next couple of weeks, and for the long term, above the $100 level. On the flip side, a drop below $60 will signal that there are still more sellers left in the market to push it below $53/50.

Read the original blog here - https://gulfbrokers.com/en/bullish-trend-persists-for-roku-despite-recent-retreat
 
Apple (NASDAQ: AAPL) stock reversed from the fresh 5-week high after we heard another hawkish FED chair Powell's speech. The stock bounced more than 3% on Monday after the US investment bank giant Goldman Sachs recommends 'buying' Apple for the first time in six years. Goldman Sachs predicts that Apple’s Services business will account for 40% of gross profit by 2027, compared to 33% in 2021. The updated 12-month price target of $199 represents a roughly 32% upside from last week's closing price.

"We recommend buying Apple stock because we believe the market's focus on slower product revenue growth obscures the strength of the Apple ecosystem and the sustainable and visible revenue streams associated with it," Michael Ng, who leads Goldman Sachs' analyst team, said.

Meanwhile, Morgan Stanley analyst Erik Woodring raised his 12-month average price target from $175 to $180 and even highlighted five overlooked catalysts that could send Apple stock into a $230 bull scenario. “Looking long-term, we see a catalyst-rich path for the next 12 months that is underappreciated by investors,” Woodring said.

EQUITIES

Global stock markets remain under pressure after Federal Reserve Chairman Jerome Powell vowed to keep pressing the fight against inflation. The Federal Reserve Chair Jerome Powell warned that the central bank would likely lift interest rates more than previously expected to fight inflation and cool down the economy. “The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated,” Mr Powell said.

OIL

Crude oil prices showed a lot of volatility and closed with significant losses on Tuesday after FED Chair Jerome Powell offered a more hawkish outlook on monetary policy than markets anticipated. While the latest API inventory report showed the US crude inventories fell by 3.835 million barrels in the week ended March 3rd, following a 6.203 million barrels gain in the previous week.

CURRENCIES

In the currency market, the dollar gained for a second straight day against a basket of currencies. The greenback hit a fresh 8-week high on Tuesday as a hawkish tone by Federal Reserve chair Jerome Powell stoked concerns about interest rates being hiked by 50 basis points this month. Moving ahead to the North American session, the USD traders should closely monitor the release of the ADP employment report and the second round of Fed Chair Jerome Powell’s Testimony.

GOLD

The safe-haven metal slightly rebounded while volatility remains high as the markets are unsettled by swings in volatility caused by the latest hawkish comments from FED chair Powell. However, the next three days are littered with key U.S. economic figures and any market disappointment over the outcome of them could potentially support the gold.

Economic Outlook

On the data front, German retail sales plunged 6.9% in January, worse than forecasts of a 6.1% drop. On a monthly basis, retail sales declined by 0.3%, following a 5.3% slump in December. Industrial production in Germany advanced 3.5% in January 2023, well above market expectations of a 1.4% rise.

Moving ahead today, the important events to watch:

US – ADP employment report: GMT – 13:15

US – BOC interest rate decision and statement: GMT – 15:00

Technical Outlook and Review

EURUSD:
Technically the current price action signals suggest that the bearish trend remains intact. For today, if the bearish momentum continues the next downside levels watch 1.0500 and 1.0480. On the flip side, the immediate resistance is at 1.0550 and then 1.0570.



The important levels to watch for today: Support- 1.0500 and 1.0480 Resistance- 1.0550 and 1.0570.

GOLD: Technically the overall trend still looks bearish after the previous session's selling pressure and the short-term support around $1800. If the metal breaks below $1800 the next important support at $1790.



The important levels to watch for today: Support- 1800 and 1790 Resistance- 1818 and 1830.

Quote of the day - The elements of good trading are (1) cutting losses, (2) cutting losses, and (3) cutting losses. If you can follow these three rules, you may have a chance - Ed Seykota.
Read more - https://gulfbrokers.com/en/daily-market-report-628
 
EURUSD struggles for clear directions as it seesaws near the lowest levels in eight weeks. The reason for such a significant weakening was the substantial strengthening of the US dollar. However, the pair slightly rebounded to above 1.0560 but the future direction will depend on NFP figures released on Friday.

EURO has been under intense selling pressure since Tuesday after the aggressive speech from Fed Chair Jerome Powell. In the coming days, the currency pair needs to stay above 1.0600 to have a chance to develop upside momentum in the near term. On the downside, 1.0500 and 1.0470 are the crucial demand area to watch.

EQUITIES

European and UK shares opened lower Thursday continuing the theme from the previous session as investors across the globe remain concerned about the impact of aggressive monetary policy tightening on economic growth. Moving ahead, the market participants and investors will now turn their attention to the U.S. NFP data that might influence the Federal Reserve’s decision on whether to act more aggressively.

On the earnings front, Oracle, DocuSign and Gap are amongst those reporting the last quarter's financial results today.

OIL

Crude oil futures remain under pressure despite inventory drop. The recent strong bearish sentiment fueled by Fed Chairman Jerome Powell's hawkish stance encouraged dollar bulls and pressured commodity prices lower. The latest EIA data showed the US crude inventories unexpectedly fell by 1.7 million barrels last week, the first decline this year.

CURRENCIES

In the currency market, the British pound struggling to find strong upside momentum as the US Dollar remains strong. The sustainability of any gain in the currency pair in the coming days will largely depend on how the US dollar behaves. Meanwhile, the dollar index slightly reversed from the highs as the US Dollar consolidated against its rivals after climbing to 8- a week high early this week. However, the overall momentum remains bullish.

GOLD

A strong U.S. dollar and rising interest rates are creating headwinds for gold. During the previous session, the metal rebounded back to above $1820 but failed to extend the gains as a stronger dollar and higher interest rates continued to hammer investment demand in the precious metals. Gold is highly sensitive to rising interest rates since higher rates dent gold's appeal as they increase the opportunity cost of holding non-yielding bullion.

Economic Outlook

On the data front, China's consumer inflation slows on weaker demand. China Feb CPI inflation slowed to just 1% from 2.1% in Jan with core inflation at just 0.6% and food price inflation down sharply.

Technical Outlook and Review

EURUSD:
For today, 1.0530 is the immediate support level, followed by 1.0500. If the pair breaks below 1.0520, the slump will quickly extend toward the 1.0480 mark. On the upper side, the euro is likely to find immediate resistance at 1.0570 and then 1.0600.



The important levels to watch for today: Support- 1.0530 and 1.0500 Resistance- 1.0570 and 1.0600.

GOLD: From a technical perspective, gold is maintaining a negative bias according to the weekly chart. If the bearish momentum continues, then the next key support area to watch is $1806 then $1800. On the upper side, If the metal regains upside momentum and presses back above $1820 then the key resistance area to watch is $1830 and $1835.



The important levels to watch for today: Support- 1806 and 1800 Resistance- 1820 and 1826.

Quote of the day – I think investment psychology is by far the most important element, followed by risk control, with the least important consideration being the question of where you buy and sell – Tom Basso.
Read more here - https://gulfbrokers.com/en/daily-market-report-629
 
Social media stocks have been on the rise in the stock market over the past 3 trading sessions including Meta, Alphabet, Snap and Pinterest after Senate Democrats and Republicans introduced a bill that would give the administration new powers to ban Chinese apps that pose security threats, including the popular video-sharing platform TikTok.

Among these stocks, Snap Inc (NYSE: SNAP) owns Snapchat, a social media platform that connects users through visual communication and storytelling and could be poised to be the biggest beneficiary since it offers more or less the same features as TikTok. The stock jumped 22% this week and gained more than 40% this year. However, the stock slightly reversed from the highs and closed almost 6% lower on Wednesday.

TikTok has over 100 million active monthly users in the US and at least 10,000 employees across the US and Europe, its parent company, ByteDance, is headquartered in Beijing, China. TikTok has been under the target of US lawmakers and politicians due to concerns over user data being sent to China. Last week, the U.S. House Foreign Affairs Committee advanced legislation that would give President Joe Biden the authority to ban TikTok in the U.S. due to national security concerns.

“We appreciate that some members of Congress remain willing to explore options for addressing national security concerns that don’t have the effect of censoring millions of Americans, a U.S. ban on TikTok is a ban on the export of American culture and values to the billion-plus people who use our service worldwide.” - Brooke Oberwetter, a spokesperson for TikTok, said.

$SNAP short-term technical outlook​

$SNAP has a 52-week low of $7.33 and a 52-week high of $39.80. Technically the overall momentum remains mixed, but we can see that the stock well rebounded in recent days. This recovery saw the shares jump to a high of $12.60, which was the highest level in months. Therefore, the stock will likely continue rising as buyers target the key resistance levels at $15 and $15.80. A drop below $9.60 will invalidate the bullish view.

Read more - https://gulfbrokers.com/en/snap-stock-outlook-after-gaining-22-this-week
 
Global markets remain volatile ahead of the most awaited macro news of the week, the US non-farm payroll report. The US Bureau of Labor Statistics (BLS) will release the February jobs report today at 13.30 GMT. The market participants are anticipating 205,000 new nonfarm jobs in February following the 517K increase recorded in January, the unemployment rate is expected to stay at 3.4%.

As we are heading to the crucial hours of this week, we may experience significant volatility with an increased risk of market gaps so we recommend to everyone should have sufficient margin coverage and be comfortable with your exposure on your account.

EQUITIES

US futures slightly regain upside momentum during the European session as investors took a breather following the previous session’s sell-off, but the upside momentum is limited ahead of the US jobs report. Dow Jones plunged below 32,000 as investors continued to bet on further Federal Reserve tightening to bring decades-high inflation under control.

OIL

Oil prices plunged to fresh monthly lows as investors remain concerned about the aggressive monetary tightening that could lead to a demand slowdown. From a technical perspective, both US WTI and brent prices are maintaining a negative bias according to the weekly chart. The volatility in the commodity market is expected to remain high in the coming weeks.

CURRENCIES

In the currency market, GBPUSD recovering lost ground. The currency pair rebounded back to above 1.1950 following the release of better-than-expected UK GDP data. Meanwhile, King Dollar struggling to regain upside momentum as traders across the globe wait for the result of the US employment to get a clear picture of the greenback's long-term direction.

GOLD

The precious metal rebounded from the weekly lows after the USD gives back some of the gains. The metal inched a little higher Friday as the dollar index stays under pressure for the third consecutive day. However, later today could see increased volatility spikes after the release of the US employment report. At the time of writing, the metal trades were above $1835.

Economic Outlook

On the data front, the Bank of Japan left its ultra-easy monetary policy unchanged on Friday in its last meeting before Governor Haruhiko Kuroda steps down and is replaced by economics professor Kazuo Ueda.

Moving ahead today, the important events to watch:

US – Non-Farm payrolls: GMT – 13:30

Canada – Employment report: GMT – 15:00

Technical Outlook and Review

EURUSD:
On the bullish side, the resistance stays above 1.0610, and a break above this exposes the index towards the 1.0640/50 level. On the flip side, rejection and pullback from the 1.0610 resistance allow for a dip towards 1.0550, with 1.0530 and 1.0500 forming additional downside targets.



The important levels to watch for today: Support- 1.0550 and 1.0500 Resistance- 1.0610 and 1.0640.

GOLD: For today, considering heavy volatility there are chances the metal can rally back to above the key resistance of $1840. On the downside, the decline is more extensive, and it will be hard to rule out a run towards $1800 if the metal breaks below again $1820.



The important levels to watch for today: Support- 1820 and 1800 Resistance- 1820 and 1826.

Quote of the day – “The art of investing is not about figuring out what has already happened. It’s about anticipating the future and creating the future that others will read about in The Wall Street Journal.” – Joshua Rogers.
 
Global stocks markets ended on a strong bearish note on Friday after financial regulators shut down one of the leading lenders in the United States, the Silicon Valley Bank (SVB). Meanwhile, the most awaited US jobs report showed on Friday the US economy added 311,000 jobs in February, more than the consensus estimate of 225,000 but the unemployment rate rose from 3.4% to 3.6%.

This week all eyes will be on the US inflation data, which could reinforce expectations of a bigger rate hike later this month. The important economic events to watch are the European central bank rate decision, US retail sales, PPI and Michigan Consumer Sentiment Index for March.

On the earnings front, the companies scheduled to release their last quarter financial results this week will be Adobe, Xpeng and FedEx.

GOLD

The precious metal opened with a gap up, increasing the price of the yellow metal to more than $1892 an ounce during the Asian session. The metal staged a decent recovery as Fed rate hike bets get scaled down. As of this writing, the precious metal is traded near $1882 an ounce. Gold price slumped to a fresh weekly low of $1809 during the first half of last week while the metal strongly rebounded back to above $1865 after the metal failed to break below the previous month's support. Moving ahead, the metal could continue to strengthen due to its status as a safe haven asset but the long-term direction of the gold price will depend on the US CPI data which will release on Tuesday.



On the upside, a hurdle can be noted near $1894 then the psychological resistance zone of $1900. A break and daily closing above the $1900 level shall trigger renewed buying interest, validating a rally towards the $1930 resistance zone. On the downside, the nearest support level is $1870 then $1862. If it breaks below $1860, it will head towards the next support level, located near $1850/44.

DOLLAR INDEX

The US Dollar Index, a measure of the value of the greenback against a basket of weighted currencies remains under pressure for the fourth consecutive day. The recent selling pressure was fueled after the release of a mixed US employment report. As a result of the latest jobs data, dollar weakness ensued and markets now seem to be pricing in a smaller 50 basis point hike at the Fed's meeting next week. Some of the key data points expected to dictate this week's dollar movements include the US inflation report, which is due out on Tuesday and US retail sales and PPI data on Wednesday.



Although the medium and long-term trend is bearish, in the short term it seems that evidence is starting to emerge that a short-term recovery of the USD. On the upper side, the first resistance is located around 104.20, a break above this level will confirm a possible move to 104.50 and 104.70. On the downside, key support seems to have formed in the 103.60 area. A four-hour close below that area could be seen as a strong bearish shift and open the floor to an extended slide toward 103 (psychological level) and 102.60.

EURUSD

The currency pair reversed back to below 1.0670 from the fresh monthly highs. Looking ahead, it seems safe to assume that movement in the euro will remain highly volatile. The crucial ECB decision this week will be the key economic data points which could determine the next move for the common currency. The European Central Bank (ECB) is expected to take a hawkish stance, with another 50 bps rate hike on the cards.



This week, the first immediate support is near 1.0600 then good support is expected at the 1.0520 area, with this zone having held last week while further down, demand is also expected around 1.0480, which will act as the next area of support. On the flip side, the first immediate resistance level for the pair is 1.0730, then the stronger resistance is 1.0760, which is important to be stable above it for a continuing rise to 1.0800 and 1.0850 levels.

DOW JONES

Dow Jones futures and other US indices managed to rebound from the early session lows during the European session on Monday after the UK authorities confirmed that HSBC bank agreed to rescue the Silicon Valley Bank’s (SVB) UK arm. While the stock futures struggle to extend their recent uptick pressured by worries about the health of the US financial system. This week, Dow should also closely monitor the release of the latest US CPI and retail sales numbers, looking for clues on future rate hikes by the central bank.



Technically the current price action signals suggest that a medium-term bearish trend remains intact. On the downside, if the bearish momentum continues the key support areas to watch are 31,600, if the index breaks below 31,600 it would open doors towards 31,200 and 30,900. On the upper side, however in case, if the pair manages to settle above 32,500, it will gain upside momentum and head towards the next resistance level at 32,800 and 33,100.


Read more here - https://gulfbrokers.com/en/weekly-review-gold-usd-eurusd-and-dow-jones-71
 
With the ongoing meltdown in the banking sector sparking worries of a recession, the US inflation report will be closely watched today, which will be released at 12:30 GMT. The inflation data could determine the size of the US Federal Reserve's rate hike at next week’s policy meeting. On a yearly basis, the Consumer Price Index (CPI) in the US is forecast to be 6.0% in February from 6.4% in January.

The markets should react positively if inflation shows further signs of cooling which will help the stocks, commodities, and Crypto pairs to regain upside momentum. While another jump in US consumer price inflation may solidify expectations around the Federal Reserve hiking rates by another 25 basis points in the next meeting.

EQUITIES

US futures continues its sideways move after the strong sell-off as investors have adopted a ‘wait and watch’ approach ahead of the US CPI data, the data could help investors determine how the Federal Reserve will move ahead with its interest rate policy.

OIL

Crude oil futures remain under pressure as the collapse of Silicon Valley Bank raised concerns about a broader economic slowdown, triggering a selloff in risk assets. Moving ahead, the oil traders also waiting for this week's OPEC monthly report, which will help form an outlook for the demand-supply balance.

CURRENCIES

In the currency market, EURUSD bulls remain in the driving seat with their feet on the accelerator supported by the weak US dollar. However, the future direction of the Euro largely depends on this week's ECB meeting outcome, the Euro traders and investors are focused on possible measures and changes that the European Central Bank may undertake in the March meeting. The dollar has declined fractionally over the last four trading days.

GOLD

The precious metal rallied to a fresh monthly high of $1912 as renewed recession fears and global growth concerns offered an opportunity for the precious metal to shine. At the time of writing, the yellow metal slightly reversed from the highs. Considering the recent bullish move gold investors will closely monitor the release of US inflation data.

Economic Outlook

On the data front, the UK reported mixed employment reports. The jobs report showed that the number of people claiming unemployment-related benefits fell by 11.2K in February, less than the 12.4k declines expected. While the unemployment rate in the United Kingdom came in at 3.7 percent, slightly below the market consensus of 3.8 percent.

Moving ahead today, the important events to watch:

US – OPEC monthly report: GMT – 11:00

US – CPI: GMT – 12:30

Technical Outlook and Review

EURUSD:
The currency pair needs to stay above 1.0700; otherwise. 1.0630/10 may be visible soon. On the upper side, 1.0740 is the key resistance zones to watch, if the pair breaks and close above this area then the next resistance area to watch is around 1.0780 and 1.0810.



The important levels to watch for today: Support- 1.0670 and 1.0630 Resistance- 1.0710 and 1.0740.

GOLD: The technical scenario is bullish after the price breaks above the psychological mark of $1900. If the bullish momentum continues, then the next upside levels to watch and $1914 and $1920. On the downside, any meaningful pullback now seems to find some support near the $1895 zones, below which the slide could further get extended towards the $1880 and $1874 region.



The important levels to watch for today: Support- 1895 and 1880 Resistance- 1914 and 1920.

Quote of the day – “There are two requirements for success in Wall Street. One, you have to think correctly; and secondly, you have to think independently.” - Benjamin Graham.
Read more here - https://gulfbrokers.com/en/daily-market-report-631
 
The collapse of the "Silicon Valley Bank" led to widespread panic in the global market, with investors and traders scrambling to sell off their assets. While the US government has already taken several measures to stabilize the banking system. The New York-based bank also financed many firms in the UK, to protect these companies UK Banking giant HSBC has acquired the British arm of SVB with the support of the Bank of England.

As of March 10, Silicon Valley Bank UK Limited had around £5.5 billion in loans and around £6.7 billion in deposits, HSBC said. "This acquisition makes excellent strategic sense for our UK business," HSBC Chief Executive Noel Quinn said.

"HSBC is Europe's largest bank and SVB UK customers should be reassured by the strength, security and protection they bring, this morning the Government and the Bank of England facilitated a private sale of Silicon Valley Bank UK to HSBC. Deposits will be protected, without taxpayer support”- Britain's finance minister, Jeremy Hunt said.

The Shocking Collapse of Silicon Valley Bank​

Silicon Valley Bank (SVB) was one of the leading banks for the innovation economy, with over $100 billion in assets under management. The bank provided a range of financial services to its clients, including commercial banking, investment banking, and asset management. The bank was shut down by US regulators on Friday in what was the biggest failure by a US bank since 2008.

The collapse of the SVB Financial Group occurred after it had to force-sell its AFS securities at a 1.8 billion loss. Following the news, customers immediately tried to pull their money, including many venture-capital firms. According to the regulator, the withdrawals initiated by depositors and investors amounted to $42 billion on Thursday alone.

On Friday, Shares of SVB Financial Group Inc., the parent company of Silicon Valley Bank, dropped more than 60% before the trading was halted after the financial institution announced plans to sell $2.2 billion in stock.

“We are taking these actions because we expect continued higher interest rates, pressured public and private markets, and elevated cash burn levels from our clients,” Silicon Valley Bank Chief Executive Officer Greg Becker said.
 
Shares of the Swiss bank Credit Suisse extended the losses Wednesday morning and hit a fresh record low. The strong bearish sentiment was fueled after Credit Suisse’s top shareholder; the Saudi National Bank ruled out further assistance to the Swiss bank. Saudi National Bank said it cannot give more money to Credit Suisse because cannot go above 10% ownership due to regulatory issues.

The bank also released its previously postponed annual report yesterday. It identifies "significant weaknesses" in internal controls over financial reporting and adds that it has not yet contained customer cash outflows.

EQUITIES

Wall Street ends higher on Tuesday following a steep sell-off in the last 3 days. The upside sentiment was lifted after the latest economic data showed that US inflation slowed as much as estimated. Meanwhile, US stock futures trading in a narrow range Wednesday morning as traders and investors are waiting for fresh retail sales data.

OIL

Crude oil prices are under huge selling pressure as the closure of Silicon Valley Bank, followed by Signature Bank, has undermined market confidence and raised recession risk fears. Crude oil futures edged lower Wednesday Morning after a large build in U.S. crude inventories. The latest API crude inventory data showed the US crude inventories increased by 1.555 million barrels in the week ended March 10th, following a 3.835 million barrels fall in the previous week.

CURRENCIES

In the currency market, the dollar index (DXY), which tracks the currency against key rivals slightly recovered and registered modest gains. The short-term recovery was helped by positive comments from Federal Reserve Governor Michelle Bowman. She remarked that the banking sector remains "resilient and on a solid foundation, with strong capital and liquidity." She disclosed that the Fed continues to closely monitor developments across the financial system.

GOLD

Spot gold prices reversed sharply lower from above $1900 to under $1886 on Wednesday morning. Moving ahead to the North American session, gold traders and investors should closely monitor the release of the US Producer price index and retail sales figures which might have a very high impact on the dollar which will result in an impact on the gold price.

Economic Outlook

On the data front, US CPI inflation rates came in as expected, and the stocks and precious metals reacted with minor gains. US CPI for February came in at 6% as against 6.4% in January 2023. Despite US inflation softening the market participants are still expecting only a 25-basis-point interest rate hike by the U.S. central bank this month.

Moving ahead today, the important events to watch:

US – Retail sales: GMT – 12:30

US – PPI: GMT – 12:30

Technical Outlook and Review

EURUSD:
The currency pair needs a clear break of 1.0750 to move further upside 1.0800 and 1.0850. On the flip side, a breakdown through 1.0650 would negate that bias and suggest a test of the 1.0600 and 1.0580 support region again.



The important levels to watch for today: Support- 1.0650 and 1.0590 Resistance- 1.0700 and 1.0750.

GOLD: The precious metal remains volatile. The metal rebounded back to above 1905 after hitting a fresh session low of $1886. If the bullish sentiment continues next key resistance to watch is $1914 then $1920. On the downside, the immediate support near 1898 then 1895, break below 1895 will open the doors to $1885 and 1880 levels.

The important levels to watch for today: Support- 1880 and 1872 Resistance- 1914 and 1920.

Quote of the day “The hardest part of investing is holding on through difficult periods and taking short-term pain so you can have long-term gains” — Jim Cramer.
Read more - https://gulfbrokers.com/en/daily-market-report-632
 
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