- Fed would release its statement on its monetary policy
- The US trade envoys have already started to adjust the market expectations
- Brexit talks are back on the main stage
Naysayers had to face it badly once again as Apple proved that it doesn’t need to sell a record number of iPhones to attract investors. In its earnings report yesterday, Apple topped revenue and sales forecast while the number of iPhones sold fell short of expectations. The number of iPhones sold (52.2 million) was nearly 3% higher as compared to the last year while the forecast was 52.3 million.
President Trump who rants about Witch hunt by using Twitter is likely to face more pressure Robert Muller who believes that he has sufficient grounds to subpoena a sitting president if he refuses to attend the court. If President Trump does receive a subpoena, investors would lose their confidence in terms of risk on trade. The US futures confirmed the direction of the trade yesterday.
Treasury yields and the dollar index would remain very much in the focus as the Fed would release its statement on its monetary policy. The dollar index has nudged lower but the overall strength in the index cannot be undermined. It took the wind out of the bull rally for metals; copper, Nickel and the precious metal.
As for the Eurozone, we expect the Eurozone’s economy to show some effects of the cold weather and its growth number may be feeble. If the number prints a reading below 0.4% it would further create obstacles for the ECB’s Hawkish monetary policy stance. The Euro/dollar pair broke the 1.20 mark yesterday for the first time since January.
The trade war between the US and China which soothed many investors because of the rosy picture painted by the like of Steven Mnuchin may actually change the situation. The US trade envoys have already started to adjust the market expectations as they are likely to return home empty hand from their trip. Commerce Secretary has also increased the noise by saying that the only solution out of this is where White House is also pleased otherwise he would return home earlier than expected.
Brexit talks are back on the main stage and investors are going to keep a close tap on it as the British pound fell to a fresh low against the dollar for this year. The next round of talks between the U.K. and the E.U begins today and the Irish border issue remains a thorny point. An outcome under which there is no deal would make the Brexit process complicated even further.
