22th August 2022: Friday trading signals are given +12.334%; Futures and stock prices fell; Share price decline; Prerequisites for rising gas prices
Symbol: UKOIL; Type: BUY; Open Price: 93.704; Close Price: 97.088; Profit: +3.485%.
Symbol: USOIL; Type: BUY; Open Price: 88.206; Close Price: 91.362; Profit: +3.454%.
Symbol: US500; Type: SELL; Open Price: 4195.14; Close Price: 4195.14; Profit: -0.786%.
Symbol: BTCUSD; Type: SELL; Open Price: 24458.34; Close Price: 22946.69; Profit: +6.181%.
Futures and stock prices fell
The yield on the 10-year Treasury note hardly moved, while the work on the two-year note increased by around five basis points. This widened the yield-curve inversion, a leading indicator of a forthcoming economic downturn. The spot index for the dollar reached its highest level in five weeks. As a risk-averse sentiment took hold at the beginning of a pivotal week for financial markets, highlighted by the gathering of central bankers at the Jackson Hole retreat, US equity futures fell along with stocks in Europe. (The market closes) European stock prices are on track to hit their lowest level in more than three weeks, with declines led by companies in the automotive and technology industries. The MSCI Asia-Pacific Share Index has dropped for the third consecutive day, with losses visible in most key markets and minor increases in China.
The price of natural gas in Europe rose sharply as concerns returned about a lengthy suspension in supply through a critical pipeline, which would put more strain on an already struggling economy. The expectation of weaker demand from China is hurting the oil price, which fell below $90 a barrel in New York before leveling off.
Share price decline
According to a study of market participants, the Federal Reserve has a long way to go before it can achieve its inflation objective. 68% of respondents believe current pricing pressures are the most unstable in decades, reducing company profitability. Even though stock prices dropped over the past week, the S&P 500’s loss for 2022 is now 11% rather than the 23% it was when it reached its lowest point in the middle of June. Since interest rates are a primary factor in determining the fair market value of a company, investment managers all over the world face the most significant threat from an accelerated pace of monetary tightening. According to those who took part in the study, the bad news is that inflation will significantly blow margins, resulting in a decline in stock prices.
According to the results of a poll by MLIV Pulse, the vast majority of consumers plan to reduce their spending over the next half year due to persistently high prices. A reduction in the amount that consumers spend would have a noticeable negative impact on the profits that are reported by firms in the S&P 500. There is a good chance that unemployment will climb to a level higher than 4% but not higher than 6%. This is a concerning number since it is more significant than policymakers are predicting but lower than other severe economic downturns in the past.
Prerequisites for rising gas prices
The increase in gas prices in Asia comes after Russia’s pipeline maintenance causes a record in Europe. Suppliers’ cost of Asian LNG is more significant than $60 per million Btu. Gazprom plans to turn off the Nord Stream gas pipeline that supplies Europe for three days. LNG dealers based in Asia have voiced their worries that the link won’t be able to resume service as scheduled.
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