X

This is not a paywall.

Register for free to continue reading.

The news sucks. But your reading experience doesn't have to. Help us improve that for you by registering for free.



Please create a password or click to receive a login link.


Please enter your password or get a login link if you’ve forgotten


Open Sesame! Thanks for registering.

First Thing, Daily Maverick's flagship newsletter

Join the 230 000 South Africans who read First Thing newsletter.

A South African Hero: You

There’s a 99.7% chance that this isn’t for you. Only 0.3% of our readers have responded to this call for action.

Those 0.3% of our readers are our hidden heroes, who are fuelling our work and impacting the lives of every South African in doing so. They’re the people who contribute to keep Daily Maverick free for all, including you.

We need so many more of our readers to join them. The equation is quite simple: the more members we have, the more reporting and investigations we can do, and the greater the impact on the country. We are inundated with tip-offs; we know where to look and what to do with the information when we have it – we just need the means to help us keep doing this work.

Be part of that 0.3%. Be a Maverick. Be a Maverick Insider.

Support Daily Maverick→
Payment options

Stocks Gain as Earnings, Rate Bets Boost Sentiment: Mar...

Business Maverick

Business Maverick

Stocks Gain as Earnings, Rate Bets Boost Sentiment: Markets Wrap

A pedestrian wearing a protective face mask is reflected in an electronic stock board outside a securities firm in Tokyo, Japan, on Thursday, Oct. 29, 2020. Japanese stocks pared losses after the Bank of Japan’s policy decision and as U.S. futures bounced back following a global equity rout.
By Bloomberg
18 Jul 2022 0

US stocks rose amid upbeat results from Wall Street banks while speculation the Federal Reserve will take a more measured approach to policy tightening eased recession fears.

The S&P 500 gained for a second day, though traded off session highs. Goldman Sachs Group Inc. shares surged after the bank reported second-quarter results that were better than expected in nearly every area. Bank of America Corp. reported an increase in net interest income.

Treasuries fell across the board as investors shunned haven assets, with the 10-year yield climbing back toward 3%. The dollar fell against all of its Group-of-10 peers. On the flip side, Bitcoin rallied back above $22,000.

The S&P 500 index is more than 5% above June’s closing low following Friday’s strong rally on renewed hopes that inflation — and Fed rate hikes — may be close to peaking. Fresh data showed a greater decline in US consumers’ long-term inflation expectations, helping boost odds for a 75 basis points hike in July and squashing talk of a 100 basis-point move.

A Dovish 2023

“We got a combination of better-than-expected inflation signals in some data points at the end of the week, reducing rate hike expectations, and better-than-expected retail sales that reassured markets about recession fears, which is lifting sentiment,” said Esty Dwek, chief investment officer at Flowbank SA. “Add to that some decent bank earnings this morning and markets are moving higher.”

Even so, a pressure point for markets remains gas supply to Europe amid a standoff with Russia over its invasion of Ukraine. Moscow has already curbed supplies to the continent amid tensions related to its invasion of Ukraine. European stocks and US futures briefly pared gains before the bell in New York

Gazprom PJSC has declared force majeure on at least three European gas buyers, according to people familiar with the matter. The force majeure notice applied to supplies over the past month, it said in a letter dated July 14.

Gazprom declared a “force majeure” on gas supplies to Europe to at least one major customer.

“The possibility that Russia stops, or severely reduces, their gas exports to Europe should keep markets on edge in the near-term,” Mizuho International Plc strategists Peter McCallum and Evelyne Gomez-Liechti wrote in a note to clients.

Gains in stock markets may prove to be short-lived as inflation pressures remain high and a recession seems increasingly likely, according to strategists at Morgan Stanley and Goldman Sachs Group Inc.

Read more: Morgan Stanley, Goldman Say Stocks Have Yet to Find a Bottom

Elsewhere in markets, West Texas Intermediate crude climbed above $100 a barrel, and copper extended its recovery from last week’s slump. Bitcoin rallied, trading above $22,000 for the first time since early June.

Key events to watch this week:

  • Earnings this week include Tesla
  • US Treasury Secretary Janet Yellen visits South Korea. Tuesday
  • Reserve Bank of Australia releases July minutes. Tuesday
  • UK Chancellor Nadhim Zahawi and Bank of England Governor Andrew Bailey speak at event. Tuesday
  • Bloomberg Crypto Summit in New York. Tuesday
  • Bank of Japan, European Central Bank rate decisions. Thursday
  • Nord Stream 1 pipeline scheduled to reopen following maintenance. Thursday

Some of the main moves in markets:

Stocks

  • The S&P 500 rose 0.7% as of 10:40 a.m. New York time
  • The Nasdaq 100 rose 1%
  • The Dow Jones Industrial Average rose 0.6%
  • The Stoxx Europe 600 rose 0.9%
  • The MSCI World index rose 1.2%

Currencies

  • The Bloomberg Dollar Spot Index fell 0.7%
  • The euro rose 1.1% to $1.0186
  • The British pound rose 1.4% to $1.2020
  • The Japanese yen rose 0.3% to 138.09 per dollar

Bonds

  • The yield on 10-year Treasuries advanced seven basis points to 2.98%
  • Germany’s 10-year yield advanced eight basis points to 1.21%
  • Britain’s 10-year yield advanced five basis points to 2.14%

Commodities

  • West Texas Intermediate crude rose 4.2% to $101.70 a barrel
  • Gold futures rose 0.6% to $1,714.20 an ounce


Comments - share your knowledge and experience

Please note you must be a Maverick Insider to comment. Sign up here or sign in if you are already an Insider.

Everybody has an opinion but not everyone has the knowledge and the experience to contribute meaningfully to a discussion. That’s what we want from our members. Help us learn with your expertise and insights on articles that we publish. We encourage different, respectful viewpoints to further our understanding of the world. View our comments policy here.

No Comments, yet

Please peer review 3 community comments before your comment can be posted