Metals higher and equities slightly shaky – What to expect from the S&P now

Frank Walbaum FX Strategies.Asia

Important news for the day

Tue, 22nd, 15:25 CET UK BoE gov Bailey speech.

Stock markets

According to Goldman Sachs strong gains in the S&P 500 index are over. Analysts say that returns of about 3% should be expected over the next decade. In particular the competition from bonds might cause the strong momentum to be subdued. The results had so far rather returned 11% in the last ten years on average. The index faces a high chance that it will remain behind the bond market this year. The low interest environment was one main driver for the positive returns as economic growth remained positive. So far this year only some tech stocks were the main driver behind the current 23% return.

Market talk

The Dollar remains stronger and might show further positive momentum moving forward. Most currencies lose steam against the Greenback, yet the momentum remains limited so far this week. Interesting might be the breakout to higher levels in the USDJPY currency pair, as further weakness in the Yen should be expected. Stock markets faced a small correction yet the VIX keeps falling, which should be seen as a sign that markets remain calm. Gold and Silver continue to move higher. If Gold can cross the upcoming slight resistance it might also continue the positive sentiment.

Tendencies in the markets

Equities positive, USD sideways, cryptos sideways, oil weaker, metals stronger, JPY weaker.

Author

Frank Walbaum

FX Strategies.Asia

Frank has been working in the TV business for several years. Acquiring his skills in Germany’s biggest broadcasting station, he then chose to work and live in Asia, which was in 2007.

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