STATE OF THE MARKETS
Stocks sink on hawkish Feds. US stocks pushed lower on Thursday after Fed’s Bullard commented that 75 basis points in November and December would be necessary to further curb inflation. Stronger job reports of lower jobless claims supported the case and yields spiked up further on the news. Russell (-1.24%) fell the most, followed by S&P (-0.80%), Nasdaq (-0.61%) and Dow (-0.30%) as the 10Y benchmark jumped to 4.24%. The Dollar index dipped to 112.17 before quickly recovering and settled near the 113 handle as New York closed.
In the commodity markets, crude maintained bids and jumped to $86.92/bl before pushing lower to settle around $84.80/bl, on Dollar strength. Aggressive rate hikes expectations continue to drag the non-interest bearing gold lower to close below $1,627.75/oz for the first time in three weeks. Elsewhere, iron ore stalled around $94.85/tn waiting for catalysts for the next move.
In the FX space, King Dollar returned to the helm of demand across all horizons after news of Fed’s aggressive rate hikes plan. Sentiments were mixed as more Swiss in demand than Yen while Aussie, Kiwi and Loonie remained in demand in the short and medium term accounts. Loonie was seen synching across all horizons, signaling a turn around might be near.
On Friday, markets expect a more volatile session as traders and investors weigh the Fed’s plan on rate hikes as CME’s FedWatch now projected a 75% probability of a 75 bps hike in December, up from 61% last week. Earnings to watch include Verizon (VZ), American Express (AXP), Schlumberger (SLB), HCA Healthcare (HCA), Huntington (HBAN) and Regions Financial (RF) as there is no important economic data scheduled for Friday.
G8 CURRENCIES SENTIMENTS
| ST | USD | AUD | EUR | CAD | NZD | CHF | GBP | JPY | ST |
| MT | USD | NZD | EUR | CAD | CHF | AUD | GBP | JPY | MT |
| LT | USD | EUR | GBP | CAD | CHF | JPY | NZD | AUD | LT |
** ST refers to Short-Term daily turnover, MT is Medium Term weekly
and LT refers to Long-Term monthly turnover.
WALL ST MOST ACTIVE
| TICKER | LAST PRICE |
% CHANGE |
VOLUME | 90 DAYS AVG |
| TQQQ | 19.21 | – 1.69 | 264,919.0K | 185,123.9K |
| SOXL | 7.70 | + 1.72 | 170,610.7K | 84,731.2K |
| GOVT | 22.20 | – 0.63 | 150,822.1K | 14,339.7K |
| SQQQ | 58.19 | + 1.80 | 146,219.3K | 127,919.8K |
| SNAP | 10.79 | – 0.64 | 125,519.7K | 48,308.4K |
| TSLA | 207.28 | – 6.65 | 117,568.2K | 79,038.7K |
| T | 16.74 | + 7.72 | 117,542.5K | 41,540.6K |
| SPY | 365.41 | – 0.84 | 88,343.0K | 82,946.1K |
| AMD | 57.77 | + 0.94 | 79,466.8K | 85,018.8K |
| LABU | 6.13 | – 1.29 | 68,210.3K | 51,345.6K |
** % Change here refers to price vs previous day price
WALL ST TOP FLOWS
| TICKER | LAST PRICE |
VOLUME |
% CHANGE | FUNDS FLOW $ |
| TSLA | 207.28 | 117,568.2K | + 49.89 | 24,369.5M |
| AAPL | 143.39 | 64,403.0K | – 30.16 | 9,234.7M |
| NVDA | 121.94 | 65,065.5K | + 6.69 | 7,934.1M |
| AMZN | 115.25 | 48,708.3K | – 14.88 | 5,613.6M |
| MSFT | 236.15 | 21,747.6K | – 24.26 | 5,135.7M |
| NFLX | 268.16 | 17,183.5K | + 10.95 | 4,607.9M |
| AMD | 57.77 | 79,466.8K | – 16.84 | 4,590.8M |
| META | 131.53 | 26,208.7K | – 16.08 | 3,447.2M |
| GOOGL | 99.97 | 25,240.0K | – 6.90 | 2,523.2M |
| GOOG | 100.53 | 25,080.7K | + 10.26 | 2,521.4M |
** % change here refers to volume vs. 20 days average volume.
TOP 5 BLOCK ORDERS
| TICKER | PRICE | TYPE | VOL/OI | FUNDS FLOW |
| PBR | 15.44 | stock/options | 91.02 | 543.1M |
| KEY | 15.85 | stock/options | 48.27 | 339.4M |
| RUM | 7.10 | stocks/options | 44.30 | 47.0M |
| ZS | 1,391.40 | Soybean futures | 106,794 | 148.6M |
| NQ | 11,019.50 | NASDAQ futures | 12,528 | 138.2M |
OUR PICK – No New Picks
No new picks going into the weekend. Investors continue to exit the capital markets as the Federal Reserve hinted at more aggressive rate hikes. Highest outflow was seen in the short term money markets (-$5.7 billion) after US equities (-$3.6 billion) and taxable bond funds (-$2.6 billion). US investors also were seen exiting the foreign equities markets (-$3.5 billion) in significant amounts. We also noticed heavy flows into mining stocks and commodities, a signal that investors are gearing for a move after the Fed’s hike is done.
Trades updates:
Equities: WBA (21% undervalued, 5.76% yields), SQ (about fairly valued with 4.96 z-score), T (about fairly valued, 6.63% yields) and CRON (30% undervalued with 23.21 z-score) rebounded this week, while M (54% undervalued, 3.39% yields) maintains resiliency. VIPS (42% undervalued with 3.92 z-score) and AUY (21% undervalued, 2.73% yields) fall back under pressure.
FX & Commodities: CAD/JPY reached medium term TP2, AUD/CHF reached short term TP1, GBP/CAD at market reached short term TP2 but the limit didn’t get filled and we remain bullish EUR/GBP.
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| HORIZON | STRATEGY | SL | TP1 | TP2 |
| Short-Term | – | – | – | – |
| Medium-Term | – | – | – | – |
| Long-Term | – | – | – | – |
Disclaimer:
This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
