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S&P 500, DAX 40 Analysis and Talking Points
- S&P 500 Consolidates Ahead of Large Cap Earnings and FOMC
- DAX & Euro Sensitivity to Gazprom Headlines Remains Elevated
Calm before the storm as markets remain muted ahead of key large cap earnings and tomorrow’s Federal Reserve monetary policy decision. That said, US equity futures are slightly lower this morning after Walmart announced a profit warning for Q2 and FY23, citing currency headwinds and surging prices. From a technical standpoint, the recent recovery in the S&P 500 appears to be nothing more than a bear-market rally, which has stalled at short-term resistance situated at 4000-15. While support at 3930-45 keeps the index within a tight range.
US Earnings Calendar
S&P 500 Chart: 4-Hour Time Frame
Source: IG
Meanwhile, the DAX 40 and Euro have been capped by the ongoing concerns surrounding gas flows via the Nord Stream 1 pipeline. Gazprom announced yesterday that gas flows will fall to 20% of capacity from a prior of 40% on Wednesday, noting that issues regarding a turbine have led to the drop in gas flows. This further highlights that DAX and Euro sensitivity to Nord Stream headlines will be elevated as the threat of a complete to halt to Russian gas flows remains a material risk.
Further reading
US Dollar, EUR/USD, AUD/USD Price Action: Fed, Q2 GDP and CPI In Focus
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