16.06.22 Macro Morning
Chris Becker | Jun 16, 2022 09:15
As expected, the Federal Reserve hiked rates by 0.75% which had mostly been priced in by risk markets losing their you-know-what in the previous week of sell offs. This created a bounce opportunity with Wall Street and European stocks lifting between 1-2% overnight. In currency land, the USD pulled back from its 20 year high, with the Aussie and Kiwi making strong gains, relatively speaking. Bond markets saw a retreat in yields, with 10 Year Treasuries pulled back from the 3.5% level to just below 3.3% with interest rate futures still suggesting more rate rises on the way, so again – all relative! Commodity prices were mixed across the whole complex, with oil prices retracing slightly as Brent crude fell below the $120USD per barrel level, while gold lifted nearly 2% after bouncing off the $1800USD per ounce level.
Looking at share markets in Asia from yesterday’s session, where Chinese share markets ignored all the downside volatility with the Shanghai Composite closing up more than 0.5% to 3305 points while the Hang Seng Index went even further, closing 1.1% higher at 21308 points. The daily chart is showing price holding above trailing daily ATR support at the 20500 point level with previously overbought daily momentum still positive. There has not been the same sort of correlated falls with other stock markets as its still a fair way from the May lows at the 19000 point level, with another small rally up towards 22000 more likely:
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