- Wall Street points to opening with a majority in red.
- European markets fall between 0.16% and 1.40%.
- The dollar reaches parity against the euro for the first time since 2002.
- Oil, commodities and cryptocurrencies remain under pressure.
The negative economic outlook, inflation, an increase in COVID cases in China, and what could happen in Germany with the gas supply, continue to drag the markets down. The dollar continues to rise and marks new highs in decades.
More and more fears
The futures of S&P 500 are falling 0.40%, while those of the Nasdaq rise 0.07%. In Europe, the FTSE 100 lost 0.42%, the DAX fell 0.57% and the IBEX 35 fell 1.40%. Added to the usual issues is the possibility that the supply of gas will not be resumed Germany since Russia after a maintenance outage.
Fear of a global slowdown and a recession in the US is already leading to expectations of interest rate cuts for next year. Likewise, for the time being, there is continuity in the rate hike to curb the inflation. On Wednesday the June Consumer Price Index data will be released, which will be key. In May the annual rate reached 8.6% and the market consensus is that it will be higher in June. Recession fears have lowered longer-term inflation expectations.
The treasury bond yields they keep going backwards. The 10-year bond yields 2.92%, and the 30-year bond 3.10%. The German 10-year benchmark is at 1.14% (it was at 1.40% at the beginning of the month).
In the foreign exchange market, the EUR/USD is in the news after touching 0.9999, and trading below parity for the first time since December 2002. In the last hours the dollar eased a bit, but in general they remain firm in the context of fears general, and expectation of an aggressive Fed. GBP/USD approached 1.18000 and AUD/USD 0.6700. DXY trades neutral on Tuesday after hitting fresh two-decade highs above 108.50
the market of cryptocurrencies return to the risk zone for more falls. The Bitcoin trade back below $20,000. The Prayed still weakened at the $1735 area, avoiding further downside, but with no signs of recovery. The silver hit new lows in nearly two years at $18.70. The prices of Petroleum they are affected by growth expectations and fall again, with declines greater than 4%.
Regarding corporate results, today is the turn of HCL Technologies and Burberry. Twitter it lost more than 11% on Monday (it was the worst in the S&P 500), and in the premarket it fell 0.30%, after the cancellation of the purchase by Elon Musk. Tesla fell 6.50% on Monday and lost more than 1% in the premarket. ConocoPhilliops loses 2.95% and American Express 2.75%. PepsiCo rises 1.28% after reporting results of the second quarter, which showed higher revenues and above expectations.
Technical levels
Source: Fx Street
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