MARKETS US / Crude Oil Price Rise Stokes Inflation Concerns and Strains Equity | News

NEW YORK (Dow Jones) – Monday’s rise in oil prices has reignited concerns about inflation on Wall Street. This fueled fantasies about interest rates that actually fell, and Wall Street turned negative for the year. Compelling business data from Goldman Sachs initially supported sentiment and the US stock markets, as did concerns about interest rate hikes. Investors’ fears that the US Federal Reserve would raise interest rates by 100 basis points at the upcoming meeting weakened.

The likelihood of an interest rate hike of more than 100 basis points has now been priced in the market at less than 30%. Last week, it was over 90 percent in some cases. One rate hike however, by 75 basis points it is priced according to the industry. However, the increase in prices on Erdl again raised investors’ doubts. After all, soaring energy prices are a key factor in inflation, which is far too high. The Dow Jones index fell 0.7 percent to 31,073 points, while the S&P 500 and Nasdaq Composite fell 0.8 percent each. On Nysa, 1,690 (Friday: 2,616) winners were counted compared to 1,566 (619) losers – 145 (117) titles were closed unchanged.

“I have the impression that something is wrong: either the economic trajectory is wrong or the analysts are too optimistic about earnings. And I have the impression that this is the case in the latter case, ”said investment strategist Altaf Kassam of State Street Global Advisors. companies’ reporting period. After all, thanks to Goldman Sachs, a large bank was able to convince. While the financial institution saw profits plummeting in the second quarter, it still made more than expected. Shares increased by 2.5%. Profits in Bank of America also fell significantly, but here analysts’ expectations were ignored – the rate stopped, supported by optimistic comments on consumer finance.

Financial services firm Synchrony Financial (+ 0.3%) exceeded market expectations, as did securities trader Charles Schwab (-1.5%). However, traders criticized the significant decline in retail sales. Aircraft orders from Delta Air Lines and Japan’s ANA helped Boeing’s stocks gain relative strength, while the stocks remained stagnant.

Oil price supported by weak dollar

In view of the prospect of the first interest rate hike in eleven years, the euro slightly recovered from losses, while the dollar index fell by 0.6%. The declining speculation about a Fed rate hike by 100 basis points caused the dollar to weaken. The euro was moving between the poles of rate hikes by the ECB, which the majority considered too low, and speculations about a possible larger interest rate hike. According to Saxo Bank strategists, an interest rate hike of 25 basis points would be a move that is “too small and too late”. Julius Br said that the ECB may raise interest rates by more than expected 25 basis points, which should strengthen the euro.

According to traders, oil prices followed the euro and the dollar, which came back from its 20-year high, was supporting oil prices. The weakness in Rohl prices over the past week was mainly due to the strong dollar, he said. Meanwhile, the director of the International Energy Agency (IEA), Fatih Birol, warned: “We are experiencing the first truly global energy crisis in history,” and IEA has warned “for months that the situation in Europe is particularly dangerous. “In addition, the data showed that the US government’s strategic oil reserves have dropped to their lowest level since 1985.

Government bonds fell in line with stock prices, yields rose in line with impending interest rate hikes in Europe and the US. The yield curve was still markedly inverted, which was perceived as a signal of recession. The price of gold hardly changed overnight.

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INDEX last + / -% absolute + / -% YTD

DJIA 31,072.61 -0.7% -215.65 -14.5%

S&P 500 3,830.85 -0.8% -32.31 -19.6%

Nasdaq Comp. 11 360.05 -0.8% -92.37 -27.4%

Nasdaq-100 11 877.50 -0.9% -106.12 -27.2%

US bonds

Term Profitability Bp to VT Profitability VT +/- Bp YTD

2 years 3.17 +4.2 3.12 243.6

5 years 3.09 +4.6 3.05 183.2

7 years 3.08 +6.3 3.01 163.6

10 years 2.97 +5.6 2.92 146.4

30 years old 3.14 +6.3 3.08 124.3

FOREX last +/-% Mon, 8:30 Fri, 17:34% YTD

EUR / USD 1.0144 + 0.6% 1.0089 1.0091 -10.8%

EUR / JPY 140.13 + 0.3% 139.48 139.81 + 7.1%

EUR / CHF 0.9917 + 0.7% 0.9846 0.9869 -4.4%

EUR / GBP 0.8487 -0.1% 0.8489 0.8507 + 1.0%

USD / JPY 138.15 -0.3% 138.25 138.53 + 20.0%

GBP / USD 1.1953 + 0.7% 1.1887 1.1865 -11.7%

USD / CNH (offshore) 6.7608 -0.1% 6.7549 6.7666 + 6.4%

Bitcoin

BTC / USD 21 533.87 + 2.5% 21 954.74 20 855.24 -53.4%

ROHL last VT-Settl. +/-% +/- USD% YTD

WTI / Nymex 102.18 97.59 + 4.7% 4.59 + 41.6%

Brent / ICE 105.76 101.16 + 4.5% 4.60 + 41.2%

GAS VT close +/- EUR

Dutch TTF 159.60 160.80 + 0.0% 0.03 + 35.2%

METALS last day before +/-% +/- USD% YTD

Gold (spot) 1,707.64 1,707.70 -0.0% -0.07 -6.7%

Silver (Spot) 18.68 18.70 -0.1% -0.02 -19.9%

Platinum (spot) 865.43 848.75 + 2.0% +16.68 -10.8%

Future Miedź 3.35 3.23 + 3.5% +0.11 -24.6%

YTD at the end of the day

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Contact the author: maerkte.de@dowjones.com

DJG / DJN / flf

(END) Dow Jones Newswires

July 18, 2022 4:13 PM ET (20:13 GMT)

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