Global Fundamental Analysis 02/02/2022

Global Fundamental Analysis 02/02/2022, FP Markets

Opening Call: The Australian share market is to open higher.


U.S. stocks closed higher ahead of earnings as investors weighed earnings reports and fresh economic data. The yield on the 10-year Treasury note rose to 1.799%, up from 1.780% on Monday. The WSJ Dollar Index fell 0.37% to 89.96. Oil prices were mixed ahead of an OPEC+ meeting. And gold prices settled back above $1,800.


Australian Market

Australia’s S&P/ASX 200 index closed a volatile session 0.5% higher amid strength in technology and financial stocks. The benchmark finished above the 7000-point mark for the first time in five sessions. The tech sector jumped 2.4%. The heavyweight financials rallied from Monday’s selloff as the Reserve Bank of Australia held the cash rate and ended its quantitative-easing program.


US Market

U.S. stocks advanced in a choppy trading session as investors weighed a recent spate of strong earnings results against continued uncertainty over the impact of higher interest rates this year. The S&P 500 added 0.7%, climbing for a third consecutive session. The blue-chip Dow Jones Industrial Average and the technology-heavy Nasdaq Composite Index both advanced 0.8%.  

“We have relatively good economic conditions, in terms of much-higher-than-normal (gross domestic product) growth, a strong labor market and consumers and companies with strong balance sheets,” said Chris Zaccarelli, chief investment officer for Independent Advisor Alliance. “But you have those big headwinds of the Federal Reserve raising rates and reducing (its) balance sheet.

I think investors are trying to decide what’s a good level… for buying some dips but also making sure they are prepared for potential volatility down the road.” The Nikkei Stock Average rose 0.3%, tracking Wall Street’s gains overnight. TDK jumped 11.2% after it raised its fiscal-year revenue and net-profit views. NEC climbed 11.0% after it boosted its fiscal-year net-profit forecast.



Gold futures climbed for a second session in a row, settling above the significant $1,800 an ounce level to start the month, as weakness in the U.S. dollar helped foster some buying in bullion. April gold rose 0.3% to settle at $1,801.50 an ounce, following a 0.6% gain a day ago, which helped to reduce a monthly decline to 1.8%, the biggest monthly fall since September. Tuesday’s settlement was the highest for a most-active contract since Jan. 26, FactSet data show. 


Oil Futures

Oil futures made modest moves, with U.S. prices ending slightly higher, as investors awaited a meeting of major oil producers that’s expected to lead to more production, and continued to track tensions over Ukraine. West Texas Intermediate crude for March delivery edged up nearly 0.1% to settle at $88.20 a barrel on the New York Mercantile Exchange. That was the highest settlement value for a front-month contract since Oct. 7, 2014, according to Dow Jones Market Data. April Brent crude, the global benchmark, declined by 0.1% to end at $89.16 a barrel on ICE Futures Europe.



Major currencies were stronger against the US dollar in European and US trade. The Euro generally held between US$1.1235 and US$1.1280 and was near US$1.1270 in late US trade. The Aussie
dollar rose from US70.55 cents to US71.27 cents and was near highs in late US close. And the Japanese yen rose from 115.05 yen per US dollar to JPY114.56 and was near JPY114.70 in late US trade.


European Markets

European sharemarkets were firmer on Tuesday. Financials rose 2.1% on the back of a 8% lift in shares of UBS. The Swiss lender announced its best annual profit since the global financial crisis.
Shares in mining stocks rose 3.5% in response to higher metal prices. Investors await meetings on Thursday by the European Central Bank and Bank of England. The pan-European STOXX 600
index rose by 1.3%. The German Dax index and the UK FTSE index both rose 1%. In London trade, shares in Rio Tinto rose by 3.2%. Shares in BHP rose by 1.0%.


Asian Markets

The Chinese stock exchanges are closed this week for holiday.

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