Opening Bell: Earnings Expectations Drive Markets Higher; USD Extends Selloff | Investing.com

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  • Treasury yields fall for the third day,
  • Market anomalies remain
  • Bitcoin trades lower

Key Events

Futures contracts on the , , and tracked a rally in European equities on Thursday as investors appeared to shrug off additional indications of rising inflation and instead focus on positive corporate earnings results. 

Gold continued to trade higher.

Global Financial Affairs

US futures extended a rebound after underlying gauges ended a three-day decline. It’s noteworthy that contracts on the Russell 2000 and the NASDAQ 100 outperformed futures on the S&P 500 and Dow Jones index.

We have been pointing out such anomalies in recent days. Yesterday, the same two outperformed despite concerns that inflationary pressure will dent the post-pandemic recovery. The sentiment seems to suggest that solid corporate earnings results are outweighing inflation worries. 

In Europe, the Index traded higher driven by the technology and mining sectors. Semiconductor stocks also outperformed amid a global hunger for chips, as manifested by Taiwan Semiconductor Manufacturing (NYSE:), a Taiwanese chipmaker, which a 13.8% increase in quarterly profits.

Most of the markets in Asia were higher. The  rose 0.5%, South Korea’s outperformed, adding 1.5%, closely followed by Japan’s ’s 1.46% climb. China’s retreated 0.1%, making it the only major regional index to close in the red, with property shares extending a selloff amid the Evergrande (HK:) fallout.

Economic data from China shows persistent inflation there. The annual rose in September at the quickest rate ever. This latest data was on the heels of data from the US on Wednesday which showed another strong increase in American last month, coupled with the from September’s Federal Reserve meeting in which members expressed rising anxiety about inflation.

Treasury yields on the note fell for the third straight day, as investors’ risk appetite grew.

The decline followed an Evening Star, a three-day reversal pattern. Rates are falling to the 200-DMA which may repeat a support. Such a patter could be the making of a H&S top. Meanwhile, the RSI is demonstrating weakening momentum, as it threatens a double top.

The dropped for the second day, tracking falling yields.

Dollar Index Daily

The greenback failed to blow out a bullish pennant. The next test will be the lower half of the 93 levels, where a H&S top, which failed to provide bulls with the impetus to complete a massive double bottom, was situated. Meanwhile, the RSI peaked out with its own H&S top.

, boosted by falling yields and a weakening dollar, rose for the third straight day.

Gold Daily

The price finally completed a small H&S bottom. However, it appears to have found resistance below the 200-DMA, as well as the RSI. The small H&S makes up the right shoulder of a larger H&S bottom.

fell off daily highs, giving up the $58,000 level, which it visited earlier today for the first time since early May.

Bitcoin Daily

If prices close at these levels, the candle will have completed a bearish Shooting Star, which could also turn out to be the head of a small H&S top. The RSI is also showing signs of topping out.

returned to its rally and traded above $81 for the first time since 2014.

Crude Oil Daily

Up Ahead

  • On Friday, Goldman Sachs (NYSE:). reports Q3 earnings.
  • University of Michigan is printed on Friday. 
  • On Friday US are published. 

Market Moves

Stocks

  • The STOXX 600 rose 0.6%
  • Futures on the S&P 500 rose 0.5%
  • Futures on the NASDAQ 100 rose 0.7%
  • Futures on the Dow Jones Industrial Average rose 0.4%
  • The Index rose 0.6%
  • The Index rose 0.6%

Currencies

  • The Dollar Index fell 0.1%
  • The rose 0.1% to $1.1606
  • The was little changed at 113.36 per dollar
  • The was little changed at 6.4332 per dollar
  • The rose 0.2% to $1.3691

Bonds

  • The yield on 10-year Treasuries was little changed at 1.54%
  • Germany’s yield was little changed at -0.13%
  • Britain’s yield advanced one basis point to 1.10%

Commodities

  • WTI crude rose 1%
  • Gold was up 0.1%





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