Conotoxia Comments

The introduction of railways, cars or the internet to the general public marked a breakthrough in the economy. It now seems that the next such technology will not be cryptocurrencies, but artificial intelligence. However, the investments associated with it could lead to a speculative bubble. It is therefore worth taking a look at how revolutions in the financial markets have historically played out and how this relates to today's reality. History of the 20th century car boom In 1886, Carl Benz of Germany developed the first three-wheeled car powered by an internal combustion engine. At the same time, Gottlieb Daimler, Benz's competitor, also developed an internal combustion powered vehicle. The invention of the automobile marked the beginning of the rapid growth of the automotive industry. From 1900 to 1919, the number of motor vehicle companies grew from 100 to almost 2,000. The actual automotive boom, however, came in 1908, when Henry Ford introduced the mass production of the Model T. The revolution here was not only the mere existence of the car, but also the standardisation of belt production, which significantly reduced its costs through economies of scale. Source: https://transportgeography.org/contents/chapter1/the-setting-of-global-transportation-systems/ford-cost-production-1908-1924/ Throughout this time, competitors were trying to catch up with Ford's assembly line advances by producing quality cars, while smaller companies were losing ground.It was hard to identify a winner in this technological race. And despite a product that was super-modern for the time, the number of American car companies had fallen to 98 by 1929. And by the 1930s, the number had fallen even further - to 44. Nevertheless, the number of cars produced was growing rapidly. It turned out that more efficient use of mass production and adaptation to the prevailing economic conditions displaced competition and gave rise to the so-called Big Three. At the time, a potential investment in GM, the leader in this big three, would prove to be a tough test for investors as the stock market crashed in 1929, known as 'Black Friday'. Source: https://www.darrinqualman.com/global-automobile-production/ In August 1929, the average price-to-earnings (P/E) ratio on the New York Stock Exchange was 23 In just two months, it fell below 15 as a result of the sharp collapse in share prices. Investing before the collapse in GM shares would have only come out at zero after more than 15 years. This example shows that investing in even very fast-growing and promising companies, when buying them relatively expensively, may not necessarily prove profitable in the long term. Source: https://www.open.ac.uk/ikd/sites/www.open.ac.uk.ikd/files/files/events/haslam-and-maielli-reframing-gm-Strategy%201909-to-1940-Final.pdf The DOT.COM bubble, or the story of the "new economy" A similar situation occurred quite recently, when companies in the internet sector were booming. The ensuing crisis led to the collapse of the Nasdaq index, which rose five times in five years, peaking at 5048.62 points on 10 March 2000. 4 October 2002. However, it fell to 1139.90 points, a depreciation of 76 per cent. By the end of 2001, most internet companies had gone bankrupt, and share prices even at established tech giants such as Cisco, Intel and Oracle had fallen by more than 80 per cent. It took 15 years for the Nasdaq index to regain its peak, which finally happened in 2015. Source: Tradingview The so-called dotcom bubble was the result of a combination of speculative fashion-based investments and an abundance of funding from equity investors for start-ups, and the inability of dotcom companies to make a profit. Investors, particularly venture capital funds, poured money into internet start-ups in the 1990s, hoping that they would one day become profitable, regardless of the price they paid for the investment. At that time, terms such as 'new economics' began to emerge, which assumed that the previous approach to valuing businesses on the basis of the profits they generated was 'outdated'. The value of a company began to be determined, among other things, by the number of hits on the company's websites. Meanwhile, as Charlie Munger aptly points out, "We spend a lot of energy creating a new way of thinking, forgetting that the old one is good enough". The average price-to-earnings (P/E) ratio rose to 175 in March 2000. This means that an investment in the average company would take 175 years to pay off. Currently, the value of this ratio is around 20. As a result, even if we had invested in winning technology companies in 2000, we would have had to wait more than a decade to make a profit. Read next: Watch prices of cereal grains, coffee and palm oil. According to long-term forecasts from meteorologists, the dry season this year will last longer than usual| FXMAG.COM „Keep your eyes on the price” It turns out that almost every time historically there has been a technology that has revolutionised reality, it has been over-invested in. Companies, aiming to be cutting-edge, spend huge amounts of money, regardless of the price they pay and the possibility of generating profits in the future. For this reason, we can increasingly hear from CEOs the phrase 'artificial intelligence' as a strategic expense for companies. It can also be expected that companies and projects based on this technology will start to emerge en masse. At this early stage, however, it seems impossible to pinpoint which ones will turn out to be the biggest winners. Sticking to the motto preached by Aswath Damodaran, one of New York University's top business valuation specialists: "Keep your eyes on the price", we can avoid mistakes. History shows that thinking that does not take price into account has always led to speculative bubbles that burst sooner or later. Grzegorz Dróżdż, CAI, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73.18% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Investment in artificial intelligence: Is it the future or another case of disillusionment in the markets? (conotoxia.com)

In the wake of climate change, we are increasingly faced with hurricanes, droughts, floods and other extreme weather events that can affect the economy. Droughts lead to reduced agricultural yields, which can result in higher food and agricultural commodity prices on global markets. A reduction in the amount of available food can in turn lead to food shortages, especially in Asian developing countries, i.e. India, among others. For this economy, reduced revenues from food production could also be crucial, given that as much as 16.8% of the workforce there works in agriculture, against an average of 5.8% for the region as a whole (World Bank data). How might this situation affect financial markets? Pessimistic forecasts from meteorologists According to long-term forecasts from meteorologists, the dry season this year will last longer than usual and be accompanied by even less rain than usual. Temperatures routinely exceed 40 degrees Celsius in Thailand, Laos and Cambodia. As a result, there are local shortages of water and electricity availability. Climate historian Maximiliano Herrera has called the current climatic conditions "the worst heatwave in Asian history". According to Herrera, the season of crop and forest spontaneous combustion usually lasts about two months and ends with the arrival of the rainy season. Cambodia's weather forecasts, however, call for an extension of the heatwave until mid-May, with less rainfall than in 2022. These forecasts can be applied equally to southern Vietnam, Laos, Thailand and Myanmar and, if correct, a potential drought could have a devastating impact on the poorer economies of the region. Source: https://en.sat24.com/en/forecastimages/azie/forecasttemp Agricultural products at risk of crop failure Agricultural products, including cereal grains, coffee and palm oil, among others, are exposed to significant impacts from drought. Wheat prices appear particularly vulnerable to climate change, with China and India ranking 1st and 3rd globally in wheat production in 2020, accounting for 17 and 12.5% of global production respectively. A crop failure could lead to shortages and drastically drive up wheat prices. Nevertheless, there is currently an oversupply in the markets for products such as maize, sunflower and wheat. This is due to the unlocking of more than 23 million tonnes of grain and food products from Ukraine. The war in that country is bringing agricultural markets down. Source: https://worldpopulationreview.com/country-rankings/wheat-production-by-country Source: Tradingview Possible negative consequences for developing countries The poorer countries of the region, which at the same time have a high proportion of people working in agriculture, appear to be particularly vulnerable to possible crop failure. Such countries in Southeast Asia include.  Read next: Conotoxia's analyst talks mistakes to avoid basing on major investors| FXMAG.COM Myanmar (23%), Cambodia (22%) or India (17%). A crop failure in these countries could even lead to famines and a significant slowdown due to the need for support and subsidy programmes for the citizens of these countries. Źródło: https://data.worldbank.org/indicator/NV.AGR.TOTL.ZS?type=shaded&view=map Grzegorz Dróżdż, CAI, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73.18% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Record heat in Southeast Asia. What impact could they have on markets? (conotoxia.com)

The earnings season for the first quarter of this year has just begun, so it is worth considering whether company reports can form the basis for investor decision-making and analysing some of the methods of the best-known investors. What to look out for before investing? There are a number of elements to look out for before making investment decisions to try to avoid unnecessary investment mistakes. The first is that the financial performance of a company does not always translate into an increase in its shares. The share price depends more on expectations about the future. Another important element is the approach to long-term investment. Investing based on Warren Buffett's strategy of investing in companies with a long-term advantage requires an approach that does not focus only on short-term financial performance. Buying shares only because of positive results seems a mistake also because attention should be paid to the nature of the business. Good investment practices includeavoiding investments in sectors that someone does not fully understand, as this is an additional risk in the form of misinterpreting market conditions. Why is Buffett investing for long-term value? Warren Buffett is an investing legend and one of the most well-known figures in the financial world. His investment style is well defined and widely known as 'value investing'. Buffett seeks to invest in companies that have solid business foundations, stable earnings growth and a strong market position. He often chooses companies in an industry that he knows very well and finds easy to understand. A key feature of Buffett's investment style is long-term thinking and patience. The investor prefers to hold on to his investments for the long term (the average holding period per share is as long as 17 years). We have learned from a number of interviews and letters to shareholders that Buffett believes that patience and perseverance are key to long-term investment success. Buffett is also known for his excellent price sense and his investment strategy focuses on buying undervalued companies. The investor seeks to buy companies at a price that is lower than their actual value, which provides him with high profit potential in the future. In summary, Warren Buffett's investment style is to invest in companies with solid business foundations and strong market positions, to hold investments for the long term, to be patient and to focus on the value of the investment rather than short-term share price movements. It seems that a significant proportion of investors in Buffett's Berkshire Hathaway fund do not realise that the company was also one of his biggest investment failures. The story of the billionaire's purchase of Berkshire Hathaway began in 1962, when Buffett noticed that the company was undervalued. Berkshire Hathaway was a textile manufacturer at the time, and Buffett recognised that its value was far greater than the share price on the market. Accordingly, he began buying Berkshire Hathaway shares, but increasing cheaper competition from China meant that the company began to run into problems. Buffett, accepting his mistake, said he had an opportunity to turn it into a better managed and more diversified holding company. Over the following years, Buffett continued to invest in various industries through Berkshire, including Coca-Cola, as well as buying other holding companies such as GEICO and General Re. With his ability to find successful companies and a long-term strategy, Buffett was able to increase the value of Berkshire Hathaway from $19 per Series A share in 1965 to almost $500,000 per share today. The story of Warren Buffett's purchase of Berkshire Hathaway seems a good example of how what is currently cheap does not always turn out to be a good investment. This may have developed the billionaire's investment style to invest in companies with very good brand names and potential for long-term growth at reasonable prices. Source: Conotoxia MT5. BerkshireHa, Daily Peter Lynch, or investing in growth at a reasonable price Peter Lynch had a different approach to investing than Buffett. The former Fidelity Magellan fund manager ran the fund for more than 13 years, with assets growing from $20m to $13bn between 1977 and 1990. His investment style could be described as Growth at a Reasonable Price (GARP), which means investing in companies that are not yet giants in their industry and have growth potential but are still attractively priced. Lynch focuses on researching companies and their businesses, and his approach to investing is based on the philosophy that investors should bet on companies that they know (or even are customers of) and understand well. The investor looks for companies that have strong business fundamentals, stable earnings growth and a competitive edge in the market. Lynch is known for using his experience as a consumer to spot companies that may have high growth potential. It also looks for companies that offer unique products or services that differentiate them in the market. Lynch believes that an investment should be treated like a business and therefore carefully analyses companies' financial statements to understand their valuations. Unlike many investors who focus solely on share prices, Lynch examines companies' business fundamentals, such as price-to-earnings (P/E) ratio, price-to-sales (P/S) ratio, price-to-book (P/B) ratio, as well as revenue and earnings growth rates. In summary, Peter Lynch's investment style is to invest in companies with growth potential that are still attractively priced, to focus on researching companies and their businesses, to use his experience as a consumer to spot companies with high growth potential, and to carefully analyse companies' financial statements. Aswath Damodaran and business valuation Aswath Damodaran is an internationally respected corporate valuation specialist and professor of finance at New York University. His investment style could be described as 'value investing' using company valuation tools, but a more accurate term would be to say that his style is investing when you know the value. It turns out that value investing can take many forms. Damodaran believes that a key feature of investment success is the ability to identify undervalued companies. The investor focuses on examining the business fundamentals of companies, such as their financial stability, growth prospects, competitive advantage and their position in the market. To do so, he uses a number of company valuation tools, such as cash flow analysis (DCF), as well as valuation models based on the ratio between enterprise value and EBITDA (earnings from operations) using the EV/EBITDA ratio, among others. The investor is known for his thorough research of individual companies and industries, as well as his ability to determine their value, which he shares on his YouTube channel. Read next: Cryptocurrency payments are steadily increasing, particularly as the DeFi market rebounds from the ‘crypto winter’| FXMAG.COM Damodaran believes that investment in companies should be treated like a business, and it seems particularly important to accurately determine value. An investor seeks to invest in companies that have foreseeable growth potential and a low valuation. In summary, Aswath Damodaran's investment style is to invest when you know the value using company valuation tools. The investor focuses on researching the business fundamentals of companies and their value, and uses a variety of valuation tools. Damodaran focuses on investing in companies that have a low valuation to their intrinsic value and are able to generate high returns with this Piotroski F-Score - one of the fastest tools to determine a company's fundamentals If we do not have the time or advanced knowledge of fundamental analysis, the Piotroski F-Score may come in handy, especially before deciding to invest in a company. This is a fundamental analysis tool used by investors to assess potential investments in companies. This method, estimated by Professor Joseph Piotroski of Stanford University, is based on the analysis of 9 different financial ratios that have been selected to determine the financial health of a given company. These ratios include return on assets, return on equity, cash flow ratio, earnings growth rate or debt, among others. For each of the nine indicators, the Piotroski F-Score awards one point depending on the company's performance in the indicator. For example, if a company achieves an increase in profits compared to the previous year, it would receive a point, but if profits decrease, it would not receive a point. In this way: the higher the F-Score, the better the financial health of the company. A study by Quant Investing showed that, on average, companies with high Piotroski F-Score values (8-9 is considered high) had long-term returns that were around 23 per cent better than the broad market. Companies with the lowest values (0-1) had, on average, worse returns by as much as 13 per cent relative to the S&P 500 index (US500). This may be due to the fact that such companies may have liquidity problems in the long term and would be forced to increase debt on unfavourable terms. Grzegorz Dróżdż, CAI, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73.18% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: What to look out for before investing and what mistakes to avoid using the example of major investors (conotoxia.com)

The dollar's position as a global reserve currency is melting away, and several factors seem to be contributing to this. One of these became known after Brazilian President Luiz Inácio Lula da Silva called on developing countries to replace the US dollar with their own currencies for international trade. During a visit to China, Lula called on the BRICS countries (Brazil, Russia, India, China and South Africa) to develop their own alternative currency for international settlements. Similar concerns have been voiced by the chief US congressional economist Jared Bernstein. This seems to have a reasonable explanation, as global foreign exchange reserves in the dollar have fallen from 63% to 58 % since 2008. What assets might be affected and what can we expect? Brazil wants to join forces with china The Brazilian president's statement seems to fit in with China's actions, which is also seeking to end the dollar's dominance on the international stage. China is currently one of Brazil's most important trading partners, with trade between the two countries worth USD 150.4 billion last year. Listening to the Brazilian President, it is worth remembering that it could be in his country's economic interest to become independent of the US currency due to its strong link to commodity prices, the value of which is calculated in dollar terms. Source: CEIC data The "dollar smile" theory The 'dollar smile' theory is an economic concept that suggests that the value of the USD tends to form a letter shape. According to this theory, the value of the dollar is expected to strengthen during periods of US economic expansion and crisis, while it is weaker during periods of moderate growth. Source: https://corporate.nordea.com/article/63638/global-the-dollar-smile-and-its-future The 'dollar smile' theory refers to the USD exchange rate forming a U-shape (see chart). The theory posits that the value of the USD tends to rise during economic cycles and financial turmoil, such as recessions, financial crises and geopolitical tensions, as investors seek a safe haven for their assets. Read next: Earnings season: Tesla stock price slipped after yesterday's news. The best selling car in Q1 was Model Y| FXMAG.COM On the other hand, during periods of strong US economic growth, the value of the US dollar tends to decline, which may be due to investors seeking higher returns on their investments in riskier, high-yielding currencies and assets. This is because a stronger economy usually means a more stable investment climate, which stimulates investors' willingness to take more risk in order to achieve higher returns. Finally, during periods of moderate economic growth, the value of the dollar tends to rise with less intensity than in times of crisis, as investors are guided by the stability of the USD. In the most general terms, the 'dollar smile' theory suggests that the value of the USD is stifflydependent on global economic conditions, and that investors would buy or sell the currency depending on their predictions of the current and future state of the global economy. Currently, the USD index is pointing to a weakening of the currency. This may be due to a slowdown in rapid post-pandemic economic growth relative to other economies, which seems to encourage foreign investors to invest in developing countries. Source: Tradingview A weakening dollar good for commodities? Commodity prices and the value of the dollar are considered negatively correlated, meaning that an increase in the value of the dollar could lead to a decrease in commodity prices and vice versa. In fact, the norm correlation for the quotations of the main commodities with the dollar index is minus 0.13. The correlation could take values from minus 1 to 1, where these extreme values indicate a strong correlation. Nevertheless, a correlation of minus 0.13 indicates a low correlation. Interestingly, the dollar index seems to have the most impact on silver quotations, where the correlation was minus 0.37. Therefore, a potential weakening of the dollar may have the most positive impact on the price of silver, but should not have a significant impact on commodity quotations at the same time. Source: Tradingview   Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73.18% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: The dollar is losing its reserve status faster and faster. What could this mean for the markets? (conotoxia.com)

Warren Buffett has raised his stakes in five Japanese trading companies. The American investor announced that he is considering additional investments in these companies. Why has Buffett turned to Japan? Warren Buffett, chairman of Berkshire Hathaway, announced in an interview with Japanese media that his company has increased its holdings in several Japanese trading houses and is interested in further investment opportunities in the Cherry Blossom country. According to data compiled by Bloomberg, these positions are now worth around $13 billion. Buffett said that he has since increased his holdings further, but his company has so far not officially confirmed any additional purchases and also has no holdings in other large Japanese companies. Five trading giants Mitsui, Itochu, Marubeni, Sumitomo and Mitsubishi are the five largest Japanese trading companies, also known as Sogo shosha (which simply means multi-trade) Buffett has more than a 5% stake in each of these companies specialising in international trade and distribution. Sogo shosha combine the characteristics of trading companies, distributors, manufacturers and business advisers. They have a wide network of contacts and negotiation skills that enable them to prosper effectively in international markets. These companies trade in energy raw materials, metals, chemical products electronics, textiles, food, machinery, among others. Sogo shosha play an important role in international trade and are crucial to the Japanese economy. It appears that the publication of the Buffet interview, coupled with the scale of Sogo shosha activity, may have contributed to the 1.6% rise in the Nikkei index (JP225). Source: Tradingview Why is Buffett investing in Japan? Investing in Japanese equities may involve risks that relate to: persistent zero economic growth for more than a decade, an ageing population or potential interest rate increases and monetary tightening. The latter factor may now play a particular role, especially in an era of rising global inflation and the weakening of the Japanese yen. In view of the possibility of interest rate rises, capital growth of Japanese companies is also to be expected. However, this could have a positive impact on the country's financial sector (excluding banks) and the strengthening of the Japanese currency, which has depreciated by as much as 16% against the US dollar since the beginning of last year. Read next: Franklin Templeton Fixed Income talk Norges Bank, Sveriges Riksbank, Swiss National Bank and Bank of Japan| FXMAG.COM The second factor in Buffett's interest in the financial sector of this market, appears to be the valuation of the companies in which he has invested. The basic ratio that determines after how many years an investment could double, i.e. price to earnings (P/E), is, in turn: Mitsui: P/E = 6, owned 6.8%. Itochu: P/E = 8.13, owned 6.2%. Marubeni: P/E = 5.4, owned 6.75%. Sumitomo: P/E = 7.7, owned 6.6%. Mitsubishi; P/E = 5.5, owned 6.66%. The values of this index are extremely low compared to the average value for the S&P 500 (US500) and the US Nasdaq (US100) technology company indices of around 22.2 and 24% respectively. Currently, the market average for Japan's Nikkei stock market is 20, which may explain Buffett's interest in this particular sector. Buffett's statement seems particularly interesting: "We don't think it's impossible that we will partner with them at some point in the future in a specific deal. We would love if any of the five would come to us ever and say, 'We're thinking of doing something very big or we're about to buy something and we would like a partner or whatever.'"   Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73.18% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Why is Buffett betting on the Japanese trading sector? (conotoxia.com)

The latest reading of the Global Financial Centers Index shows a decline in Zurich's rating among the 110 locations surveyed. Switzerland appears to be losing ground as a financial centre in relation to Singapore and Dubai, among others. It is possible that the current problems in the banking sector, linked to the takeover of Credit Suisse by UBS, could have the effect of reducing the competitiveness of the Western world in favour of the East. What impact could this have on Switzerland? Global Financial Centers Index The Global Financial Centres Index (GFCI) is an authoritative assessment of the competitiveness and strength of financial centres around the world. The index was developed by the consulting firm Z/Yen Group in 2007 and has been published regularly every six months since then. The GFCI is based on surveys of the financial industry, experts and financial institutions around the world. Survey respondents rate various aspects of the business environment in their cities, such as political stability, financial regulation, quality of infrastructure, availability of capital, labour market, culture and lifestyle. The index currently covers more than 100 cities around the world, and a list of the most important financial centres is compiled. The GFCI is used as a tool to compare different cities from the point of view of attractiveness for the financial industry, which could help in making decisions about business location or financial investment. Five main areas of competitiveness were used in the analysis: business environment, human capital, infrastructure, financial sector development and reputation. Switzerland is also losing its attractiveness as a business centre, as McKinsey shows. The study suggests that Switzerland has missed out on relocation opportunities for large multinational companies such as Apple, Amazon, Alibaba, Facebook, Netflix, LinkedIn, Airbnb, Starbucks, Tesla and Uber, with only 5% of the top 250 Chinese companies choosing the Alpine country as the location for their European headquarters. In the long term, this could have a negative impact on the listing of the Ishares Msci Switzerland ETF (EWL). Source: Conotoxia MT5, EWL, Daily Will big corporations bypass Switzerland? The 2019 study. "Reinforcing Switzerland's attractiveness to multinationals" focused on Switzerland's attractiveness as a location for multinational corporations. The location, traditionally seen as optimal for foreign corporations, seems to have lost ground in recent years compared to other locations. The study focused on interviewing more than 100 managing directors of multinational corporations to explore their views on the attractiveness of Switzerland as a location for their companies. The study found that foreign corporations play a key role in the Swiss economy, contributing to more than a third of Swiss GDP, 1.3 million jobs and almost half of Swiss corporate tax revenues. Furthermore, these corporations typically create jobs in high-productivity sectors, which has a significant impact on Swiss productivity. Despite everything, UBS is reviving? After the takeover of Credit Suisse by UBS, the situation in the European banking sector seemed to have calmed down, but in the same week there were reports of a growing threat of Deutsche Bank's insolvency. Nevertheless, since the beginning of the week, UBS shares seem to have stopped losing value. Source: Conotoxia MT5, UBSGroup. Daily In the face of growing problems in the banking sector and global inflation, the question is whether the Western world can lose its dominance of the financial sphere to the East. In recent years, Asian economies, including China, have been growing significantly, which has attracted the attention of investors from around the world. Alongside this, authorities in China and other Asian countries are taking steps to consolidate their influence in the global financial market, for example by developing financial infrastructure and investing in the technology sector. Read next: Experts: the current banking problems are not a repeat of the global financial crisis| FXMAG.COM However, this is still only theory and much depends on how Western countries respond to the challenges of inflation and the banking sector. The right decisions and actions could help to maintain dominance over the financial segment. Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

On Sunday (19.03), UBS announced the acquisition of Credit Suisse bank for more than $3.24 billion. Colm Kelleher, chairman of UBS, said it was an "emergency rescue" for Credit Suisse, while UBS sees the deal as an investment opportunity. UBS says the merger will have a positive impact on the bank's profits, with savings of $8 billion a year by 2027. Credit Suisse is to be wound down as part of the acquisition, and the integration of the two banks will take about four years. What can we expect from the acquisition and what impact will it have on UBS? A few words about UBS and the Credit Suisse situation UBS (United Bank of Switzerland) is an international investment bank that provides financial services to individuals, companies and institutions worldwide. The bank offers a wide range of products, including private banking, corporate banking, asset management, investment services, M&A advisory and project finance. UBS was formed in 1998 from the merger of two Swiss banks: Union Bank of Switzerland and Swiss Bank Corporation. Today, the bank is headquartered in Zurich and operates in more than 50 countries around the world, with more than 70,000 employees and it is the largest private Swiss bank. For more than a year, we have heard about the problems of the second largest Swiss bank, Credit Suisse, which has been struggling with, among other things, numerous lawsuits, money laundering scandals, which has caused customers to lose confidence in the bank and start withdrawing funds from the bank. Previous banking crises were caused by hidden losses, which does not seem to be the case for Credit Suisse. According to investment firm Axiom Alternative Investments, the bank is regarded as the weakest link among global systemic banks. And its problems stem from the fact that its customers have chosen to withdraw funds from their bank accounts. Credit Suisse Bank has experienced a $270 billion reduction in the value of its assets in just the past year alone, a 32% drop as a result of a more than 50% drop in its $215 billion cash holdings. These problems have led to the share price falling from CHF 14 to CHF 2 (a drop of as much as 85%). Source: Conotoxia MT5, Cred. Suisse, Daily What impact will the acquisition of Credit Suisse have on UBS? Following speculation and concerns about the banking crisis, UBS has decided to take over its long-standing Swiss rival. UBS CEO Colm Kelleher defined: "This acquisition is attractive to UBS shareholders, but let's be clear, as far as Credit Suisse is concerned, this is a crisis rescue." The acquisition will be for $3.24bn, which, with the bank's current market capitalisation of $6.26bn, could be a long-term opportunity for UBS. Nonetheless, investors seem to be taking it negatively, as UBS shares have fallen by more than 17% since the beginning of March. We could assume that the takeover decision has been driven by fears of a possible panic of a massive capital outflow from the Swiss banking sector. It seems that the takeover could not take place without drastic restructuring decisions, which may include numerous cost-cutting measures through, among other things, staff cuts. Source: Conotoxia MT5, UBSGroup AG, Daily UBS appears to be able to take over Credit Suisse and provide it with liquidity without too many problems. UBS's cash is worth $204 billion, so the purchase of Credit Suisse alone is only 1.5% of the bank's cash holdings. However, it is important to remember that with the acquisition of the bank's assets, UBS will take over its liabilities and problems. However, if UBS manages to restructure successfully, it will be able to talk about taking over one of its key competitors. Read next: Microsoft, Amazon and Google increased by nearly 15% last week| FXMAG.COM An inevitable coincidence with the collapse of the SVB It might seem that the problems in the US banking sector caused by the collapse of Silicon Valley bank SVB were a prelude to the announcement of Credit Suisse's lack of liquidity. However, it is important to stress that the problems of the two banks are distinct from each other. The collapse of SVB appears to have been caused by Fed policy and the mishandling of its debt portfolio. SVB was a major bank financing high-tech projects and startups. As interest rates were raised and monetary policy tightened, debt became more expensive and less available. In this case, the prices of the bonds in which the bank invested its funds fell, which would not have been a problem if funds had been held to redeem them. However, due to the large outflow of funds from the bank, it was forced to sell its assets at unfavourable prices, leading to a huge loss and loss of liquidity. This is in contrast to Credit Suisse's problems, which had been accumulating for a long time, and the loss of liquidity was due to a gradual loss of confidence in the institution by clients. Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The Fed announces that it will raise interest rates and one of the big Silicon Valley banks has liquidity problems. As the news becomes widespread, this bank's shares fall by 60% in a single session. This seems to have had a knock-on effect on the shares of the entire financial sector. Could other banks really be in trouble because of this, and what else have we learned during the past week? Macroeconomic data Monday's reading of the UK construction sector sentiment index came as a surprise at the start of the week. The data beat analysts' expectations, coming in at 54.6 points (49.1 points were expected). This is the first reading in two months heralding an improvement in the health of the sector. Tuesday's key event was a speech by Fed Chairman Jerome Powell, who said, among other things: "If the totality of the data indicated that faster tightening of financial policy was warranted, we would be prepared to increase the pace of interest rate hikes." Following Powell's speech, the S&P 500 Index (US500) began to fall, ending the week at minus 3.6%. Source: Conotoxia MT5, US500, Daily Wednesday brought us the US non-farm employment forecast report (ADP). The document, created from the payrolls of US companies, seemed to predict the final readings of the change in non-farm employment quite well. The current reading was better than expected at 242,000 (200,000 was expected). This would indicate that the US labour market is still strong, which may encourage the Fed to raise interest rates further. The Bank of Japan's interest rate decision seemed to come to the fore on Thursday. The institution's new governor chose not to change the negative level of interest rates. Japan's Nikkei index (JP225) was able to gain in anticipation of the announcement of the decision, before returning to levels seen earlier in the week. Source: Conotoxia MT5, JP225, Daily In Germany, CPI inflation for February came in at 8.7%, unchanged for three consecutive readings, as forecast. An important news item for the US market could be the non-farm employment reading, where an increase of 205,000 is expected. The stock market In Thursday's session, we learned of the problems of SVB Financial Group bank, whose shares slumped by as much as 60%. This seems to have caused declines in the entire US financial sector. It ended the week with a performance of more than minus 5%, as could be seen in the listing of the Financial Select Sector SPDR Fund (XLF). Source: Conotoxia MT5, XLF, Daily Source: https://www.sectorspdr.com/sectorspdr/tools/sector-tracker Among the companies whose shares fell the most this week are the aforementioned SVB Financial Group bank, whose shares slumped by more than 60%. Shares of electric car manufacturer Tesla fell by almost 10%. Among the few companies whose shares rose are: Apple, up 3.2%; Meta (Facebook), up 4.1%; and General Electric (GE), up 6.8%. All key changes can be seen below. Source: https://finviz.com/map.ashx?t=sec&st=w1 Currency and cryptocurrency market In the foreign exchange market, we could see another week of strong strengthening of the US dollar. The EUR/USD pair exchange rate fell by 0.4%. The biggest changes in USD quotations could be seen on the pair with the Australian dollar. The USD/CAD exchange rate rose by 1.8%, approaching resistance levels of 1.4. Source: Contoxia MT5, USDCAD, Daily The value of cryptocurrencies is plummeting as a result of the issues surrounding Silvergate bank, a key player in the market. Bitcoin has lost more than 12% of its value over the past week, falling below $20,000, while ethereum has shrunk by 11.6%. The situation appears to be unfavourable for cryptocurrencies. The weekly change in stablecoin market capitalisation, which determines the value of capital in the market, has now fallen by 2% m/m. Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.     search   g_translate    

Research firm Spruce Point has conducted a detailed analysis of Essential Utilities and, as with the high-profile Hindenburg Research report on Adani Group, has serious concerns about the accuracy of financial reporting, the business model and the company's ability to meet its financial obligations. In a report that is 91 pages long, Spruce Point believes that there is approximately 35-50% (to a price of US$20-28) downside risk to the company's shares. Let's take a look at the key points from the report. What does Essential Utilities do? Essential Utilities is a US holding company that provides water, wastewater and gas services in the United States. The company was founded in 1886 as Bryn Mawr Corporation and changed its name to Aqua America in 2007. In 2020. Aqua America changed its name to Essential Utilities to better reflect its business, which has expanded to serve gas customers. The company serves customers in 10 states, including Pennsylvania, Ohio, Illinois, New York, New Jersey and Virginia. The company designs, builds and operates water, wastewater and gas infrastructure, and also provides water and wastewater quality monitoring and waste-to-energy recycling and recovery services. In 2018, the company acquired US natural gas supplier Peoples Natural Gas (hereafter Peoples) for a largely borrowed sum of almost $4.3bn. Accusations concerning the water company Spruce Point cautions investors to be wary of companies that frequently change their names and corporate branding, as it may be a tactic to hide a problematic history. Essential Utilities, Inc. which went through a debt-financed acquisition of Peoples Natural Gas, thereby changing from a water and wastewater company to a water and gas company. Spruce Point's research suggests that this transaction was done out of necessity and masks mounting financial pressures, with negative cash flow and record leverage (debt-to-equity ratio of 1.19 against a sector average of 0.13). The company has a history of failed expansion efforts and negative customer feedback. According to the research firm, there is evidence that customer water supply revenues and return on equity and earnings per share were declining prior to the deal with Peoples Natural Gas. Although Essential Utilities benefited from increased water usage during the pandemic period, performance trends now appear to be normalising. The company presented weaker growth targets for 2023, no longer committing to a minimum rate base growth from the acquisition. The company has also slightly lowered its estimated organic growth rate. Spruce Point believes that the company's investors will experience further disappointment in future results. "The acquisition of Peoples Natural Gas is already being assessed for impairment." The article discusses Essential Utilities' acquisition of a gas company in 2018 for $4.275 billion. This was to expand the company's regulated natural gas business. However, there are concerns about Peoples' financial performance, and a recent audit by the Pennsylvania Utility Commission found that the company needs significant improvements in financial management, cost allocation, governance and gas operations. There are also long-term pressures on the natural gas business due to declining demand, which is linked to increased equipment efficiency and environmental measures, as well as increased interest in alternative energy. The potential for growth in the customer base is a key marketing argument used by Essential Utilities, but Peoples' performance remains below expectations, with forecasts reduced by $100 million a year. The article also discusses potential financial inaccuracies in Essential Utilities' reporting on the Peoples acquisition, as well as issues related to the quality of the customer base and provisions for doubtful accounts. "Essential Utilities' dividend policy is nonsense" Spruce Point has carried out a financial assessment of Essential Utilities, which has positioned itself as a growth company that aims to pay regular dividends. Essential Utilities' policy is to pay a dividend of no more than 65% of net profit. However, according to Spruce Point, this dividend policy is flawed due to high investment capital expenditure and acquisition commitments. Spruce Point suggests that Essential Utilities should pay a dividend commensurate with its free cash flow after meeting its investment and acquisition commitments. The company has never been able to cover its dividend from free cash generated after meeting these commitments, and its ability to do so has deteriorated since 2018. Spruce Point warns investors that the dividend reinvestment scheme offered by Essential Utilities at a 5% discount is not a good investment proposition. The funds raised from investors through these schemes could be used to pay dividends to other investors. Why does Spruce Point think Essential Utilities is overvalued? The warning issued by the research firm relates to Essential Utilities and its relationship with questionable brokerage firms. Spruce Point believes that the company is overvalued and that investors should pay particular attention to independent analyst Morningstar's opinion of the company's shares as a 'sell'. The research firm is carrying out a sum-of-the-parts valuation for Essential Utilities' water and gas businesses, which are separate companies. Spruce Point believes investors should also factor in significant dilution and a larger debt issue in valuing Essential Utilities' forward share price. The authors of the alert believe that Essential Utilities' financial pressures are being ignored by analysts, who are lowering financial estimates and target prices insufficiently. Therefore, the research firm estimated that an appropriate value per Essential Utilities share is between US$20 and US$28, approximately 35-50% below the current price. Source: Conotoxia MT5, EssentialUT, Daily Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

From intensified SEC action against the cryptocurrency market, to declines in the value of bitcoin and other digital currencies, to the troubles of the long-struggling Silvergate bank, which has a significant share of the cryptocurrency market, a lot has happened in the digital currency market since the beginning of this year. We take a look at the current situation in this market based on the data. Declining dependence of bitcoin on the market Since the beginning of the year, the S&P 500 Index (US500) has posted a 5.8% return, while the value of bitcoin has risen by 34%. Historically, the level of correlation between bitcoin and the stock market was around 0.6 (R^2=36%), indicating a relatively significant relationship. However, since the beginning of the year, the correlation between the two assets has dropped sharply to 0.31 (R^2=9.6%). This may indicate a decoupling of the cryptocurrency market from the ups and downs of the broad equity market. Source: Conotoxia MT5, US500, Daily The average correlation of the 70 largest cryptocurrencies with bitcoin was 0.64 (R^2=41%), which would mean that the majority of this market is still dependent on the situation on just this one cryptocurrency. Nonetheless, an investment in altcoins would have yielded an average return of 41.2% (7.2 percentage points higher) and as many as 89% of them achieved a positive return during this time. The average annual symmetric risk, as measured by the standard deviation, for the period under review in the cryptocurrency market was 14.44%. For bitcoin, it was slightly lower at 12%. Volatility in this market seems to have returned, as the standard deviation for the stock market was only 2.3%. Which means that the average volatility in the digital currency market is now more than 5 times that of the stock market, which may prove more attractive to active investors. Further outflows of funds from the cryptocurrency market The size of the monetary base, as measured by stablecoin capitalisation, seems to have played a key role in consolidating the upward trend. Unfortunately, their volume seems to be steadily declining month by month. According to the StablecoinPrinter website on Twitter, virtually no new major stablecoins were created in February this year. The capitalisation of this entire market fell by 25% y/y. and by 2.4% m/m. It seems that it might be hard to see growth in this market without an influx of fresh capital. Source: https://btctools.io/stats/market-cap Despite the increase in SEC scrutiny of the cryptocurrency industry, there have been no immediate outflows of funds from the largest proof-of-stake cryptocurrency, Ethereum. This could  be seen in the level of network performance (hashrate), which has remained stable, indicating that there are still a large number of users using the Ethereum network. Nonetheless, it is worth noting the growing regulatory risks that may affect the future movements of cryptocurrency investors and users. Analysis of emotions Emotions such as anger and fear are currently prevalent among investors, according to Sentistock, a company that studies emotions in the cryptocurrency market based on social media posts. The company's artificial intelligence, used to forecast bitcoin prices in the near future, predicts an average price of US$22624 for the next 24 hours, 1.1% above current levels. Source: https://sentistocks.com/predictions/ Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

There were a number of significant developments in the markets this week, including surprising inflation readings, declines in the cryptocurrency market and hopes for China's industry, which posted its best performance in more than a decade. In addition, many other events took place in the financial markets. What else could we have learned? Macroeconomic data We began our macroeconomic data with Monday's reading of home sales under construction for January in the United States, which rose by as much as 8.1% m/m. (1% m/m was expected). This is the highest reading since September 2020. Could this mean that, despite high interest rates, the property market is starting to recover for this economy? We started Tuesday with the publication of the US CB Consumer Confidence index. The reading fell short of expectations, coming in at 102.9 (108.5 was expected). On the same day, we learned about the PMI Industrial Sentiment Index for the Chinese economy, which positively beat expectations, coming in at 52.6 (50.5 was expected). This is the highest reading for this economy in more than 10 years! The ChinaH index rose by almost 5% this week. Source: Conotoxia MT5, CHINAH, Daily Wednesday brought us data from Germany, such as the PMI industrial business sentiment index, which came in at 46.3 points (46.5 points were expected). In addition, we learned about the CPI inflation reading for February, which came in at 8.7% (8.7% was expected). However, it appears that despite further interest rate increases in the euro area, inflation does not want to fall. The US manufacturing PMI came in slightly worse than analysts' consensus, at 47.7 points (48 points expected). Thursday seemed to be crucial for this week. First, we had a look at inflation in the euro area, which, like inflation in Germany, surprised negatively. It turned out to be higher than expected at 8.5% (8.2% was expected). On the same day, we learnt the reading of new claims for unemployment benefits in the United States, which came in at 190,000 (195,000 was expected). It seems that the labour market remains as strong as ever for this economy. The stock market A large proportion of sectors ended the week on declines. The largest declines of at least 2% included the utilities sector and the retail services sector. The largest increases of 3.4% came from the materials sector. In second place was the industrial companies sector with an increase of 1.66%. Source: https://www.sectorspdr.com/sectorspdr/tools/sector-tracker The companies that had the biggest changes during the week were Tesla's (Tesla) shares down more than 5%, the shares of online short-term rental platform Booking.com (Booking) up more than 6%, or rail holding company Union Pacific Corporation, which rose almost 10%. Source: https://finviz.com/map.ashx?t=sec&st=w1 Currency and cryptocurrency market The US dollar has been weakening in the foreign exchange market against other currencies, with the EUR/USD pair rising by 0.6%. This may be linked to expectations of an interest rate increase in the euro area due to higher-than-expected inflation. The only one of the major pairs to rise during the week is the New Zealand dollar pair against the US dollar. Source: Conotoxia MT5, EURUSD, Daily At the end of the week we saw declines in the cryptocurrency market. The price of bitcoin fell by almost 4% during the week. It seems that this may be related to the so-called Silvergate, the bank that disconnected the ability to make transfers for one of the largest cryptocurrency exchanges Coinbase. Additionally, as is the case every week, investors can look forward to an influx of fresh funds into this market, which could be measured by, among other things, stablecoin capitalisation, which is down by as much as 2.1% m/m. Source: Conotoxia MT5, BTCUSD, Daily Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

In order to more accurately predict the future of the economy and financial markets, it is important not only to use graphs and technical analysis, but also to understand the current economic situation and the factors influencing it. In this text, we will focus on analysing detailed data and interpreting it to answer the question of how these factors may affect financial markets. Inflation in the price of services, not products Source: FRED, Durables and service price inflation Above, the green colour shows US CPI inflation. The blue colour indicates the price change in the durable goods sector and the red colour the inflation of the services sector. As could be seen from the above data, during the pandemic, demand for durable goods increased dramatically, resulting in higher inflation in this sector. However, the situation has started to reverse in recent months, with prices in the durable goods sector starting to fall by more than 1% year-on-year. In October 2022, inflation in the services sector surpassed inflation in the durable goods sector for the first time since the start of the pandemic. It appears that the further direction of inflation may depend on the sectors adapting to changing consumption habits. Source: FRED, Change in consumer consumption Post-pandemic consumption habits shifted from services to durable goods in a way not seen before. Consumption of durable goods and services fell significantly in the first months of the pandemic. This difference appears to have resulted from fiscal support and a change in consumer habits caused by the pandemic, shifting demand from services, such as eating out in restaurants and travel, to purchases of furniture and fitness equipment. The graph above shows changes in personal consumption expenditure, where demand for durable goods is shown in blue and services in red. However, we could see a renewed shift in trends in consumer habits from durables, whose demand has hardly increased, to services, whose demand has been growing steadily since the beginning of 2021. This would confirm rising inflation in the services sector and falling inflation in durable goods. Source: FRED, Price inflation for the shelter, and non-shelter market Changes in the CPI consumer price index presents an interesting price trend in the rental market. According to the data, from January 2022 to January 2023, the rental cost index increased by 7.9%, which is more than 2 percentage points above the overall inflation rate of 6.3%. For all types of costs other than rent, the price index started to decrease from June 2022. This may mean that the peak inflation episode is coming to an end, at least as far as prices outside the rental market are concerned. It could also mean that investing in rental property is one of the most effective ways to combat inflation. Probability of recession still low Source: FRED, Smoothed probability of recession One model for estimating the probability of a recession in the US is the Markov model, which uses four monthly variables: non-farm payrolls, the index of industrial production, real personal income excluding transfers and real trade and industry turnover. It appears that the increasing likelihood of a recession may be affecting the S&P 500 Index (US500) in a negative way. Nevertheless, current values of almost 5% may imply a low probability of a recession. We could conclude from this that the lows on the previously mentioned index may be behind us. Source: Conotoxia MT5, US500, Daily A labour market that means companies don't want to hire? Source: Fred, change in the number of current and new job vacancies compared to 2020 In the chart above, the number of current job vacancies in the market against 2020 levels is shown in red and the change in new job vacancies in the market is shown in blue. We could see that after the pandemic slump in the labour market we are now above pre-pandemic levels. Nevertheless, we could see a stagnation in the job offers market from the beginning of 2022. Source: FRED, Number of economically inactive persons The labour force includes people who are currently employed or actively seeking employment. The pandemic has caused a significant proportion of the workforce to lose their jobs. The graph above shows a spike in the number of people out of the workforce in spring 2020, which has since declined but is still higher than pre-pandemic levels. The extended red trend line shows that there are now around 2.2 million more people outside the workforce than expected based on trends leading up to the pandemic, contributing to the current shortfall in the workforce. Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Purchasing Managers Indexes are due next week in three major economies, which may allow to assess the state of manufacturing in each country and draw some comparable conclusions between them.   Tuesday 28.02. 15:00 GMT, US Conference Board Consumer Confidence (February) Conference Board (CB) Consumer Confidence index measures the consumer confidence level in economic activity. It is a leading indicator that can predict consumer spending, which plays a significant role in overall economic activity. Higher readings indicate greater consumer optimism. A reference point of 100 that is used is the consumer confidence index from 1985.  The consumer confidence index fell from 109.0 in December to 107.1 in January, below the expected 109.0. In particular, consumers were less optimistic about short-term job prospects and expected business conditions to worsen. Nevertheless, consumers expected their incomes to remain stable over the coming months. Purchase intentions for cars, and household appliances remained stable. However, fewer consumers were planning to buy a new or existing home. The consumer confidence index is expected to rise to 109.5 in February.  Higher than expected reading may have a bullish effect on the USD, while a lower-than-expected reading could be bearish for the USD. Impact: USD Wednesday 01.03. 01:30 GMT, China Manufacturing Purchasing Managers Index (PMI) (February) The Purchasing Managers Index (PMI) provides the first indication of economic activity in the Chinese manufacturing sector as purchasing managers are considered to have access to first-hand data on the performance of their companies. A reading above 50 indicates expansion, while a reading below 50 indicates contraction in the manufacturing sector. China's PMI spent most of 2022 in contraction territory, as the economy faced production disruptions due to the Covid-19 pandemic. Last month's PMI was better than expected, showing the first sign of expansion since September 2022 - 50.1 versus the expected 49.8 and December's 47.0. This month's reading could indicate whether China's manufacturing sector is continuing its upward trend or whether January's positive reading was just a one-off boost. February's PMI is expected to come in at 49.8, indicating a slight contraction in the manufacturing sector. Better-than-expected results may be seen as bullish for the CNY, while lower results may be bearish for the CNY. Impact: CNY Wednesday 01.03. 09:30 GMT, UK Manufacturing Purchasing Managers Index (PMI) (preliminary February data) UK Manufacturing PMI has shown signs of an even sharper contraction than China's. The last time the UK PMI was in expansion territory was in August 2022; since then, the figure has slipped closer to 45. Preliminary data for February are expected to show a slight increase from last month (47.5 versus 47). A UK PMI index below 50 may indicate that the UK manufacturing sector is experiencing uncertainty about the economic outlook and has reduced demand due to lower risk appetite and higher borrowing costs.  Higher than expected reading may have a bullish effect on the GBP, while a lower-than-expected reading could be bearish for the GBP.  Impact: GBP Wednesday 01.03. 15:00 GMT, US ISM Manufacturing Purchasing Managers Index (PMI) (February) The US manufacturing PMI is close to the UK manufacturing PMI - last month's PMI was reported at 47.4. One visible difference between the two is that the UK PMI index has been fairly stable, with signs of improvement in recent months, while the US PMI index has been gradually falling since December 2021. February's data are expected to show a slight increase to 47.9, ending the downward trend. However, the actual data have been lower than forecast for the past 3 months.  A higher-than-expected reading could be bullish for the USD, while a lower-than-expected reading could be bearish for the USD.  Impact: USD Thursday 02.03. 10:00 GMT, Eurozone Consumer Price Index (CPI) YoY (preliminary February data) The CPI measures the change in prices consumers pay for a given basket of goods and services compared to a year ago. The CPI is the most widely used measure  of inflation - a higher index means higher inflation. The inflation outlook for the euro area appears to be influenced by two opposing factors. On the one hand, lower-than-forecast energy prices may push down inflation faster than previously thought. On the other hand, the pass-through pressure of energy and commodities inflation to production costs is not yet over, keeping the overall inflation high. In addition, as the geopolitical situation in Europe seems  not improving, the ongoing price negotiations in the agricultural sector could lead to higher-than-expected prices, giving an additional boost to inflation figures. This results in a slightly lower inflation rate compared to the double-digit numbers at the end of 2022, but still a long way from the ECB's 2% target. Higher-than-expected data may have a bullish impact on the EUR and a bearish impact on the stock market, while lower-than-expected data may have a bearish effect on the EUR and a bullish impact on the stock market.  Impact: EUR, DAX, STOXX Stocks to watch Target (TGT) announcing its earnings results for the quarter ending on 01/2023. Forecast: 1.39. Positive earnings surprise in 7 out of the last 10 reports. Time: Tuesday, February 28, before the market opens. Costco (COT) announcing its earnings results for the quarter ending on 02/2023. Forecast: 3.21. Positive earnings surprise in 6 out of the last 10 reports. Time: Thursday, March 2, after the market closes. Santa Zvaigzne-Sproge, CFA, Head of Investment Advice Department at Conotoxia Ltd. (Conotoxia investment service) Materials, analysis, and opinions contained, referenced, or provided herein are intended solely for informational and educational purposes. The personal opinion of the author does not represent and should not be constructed as a statement, or investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Expectations of interest rate rises by the Federal Open Market Committee (FOMC) may be rising as a result of the report of their last meeting, where members declared increased action to combat inflation. This had a negative impact on sentiment, among others, in the US market. What else did the past week reveal to us? Macroeconomic data We started the week of key macroeconomic data on Tuesday. First, we learned about economic sentiment readings in Germany. The PMI industrial managers' sentiment index came in worse than expected at 46.5 (47.8 was expected), while the sentiment index for the next six months among financial analysts positively beat expectations at 28.1 (22 was expected). This is a continuation of the increase in this indicator for 5 months. Rising expectations seem to be keeping the DAX index (DE40) up, which closed at the same level it was at the beginning of the week. Source: Conotoxia MT5, DE40, Daily On the same day, we learnt readings of sentiment indicators from the UK, which surprised analysts positively. The PMI for both manufacturing and service sectors came in at 53 points (49 points were expected). This is the first reading above 50 points since August 2022, which could indicate expected future growth in this economy. This would also be confirmed by UK company valuations. The UK100 Index (UK100) is currently reaching its historic highs. Source: Conotoxia MT5, UK100, Daily We started Wednesday with Germany's CPI inflation reading for February. It was in line with expectations at 8.7%, the first increase in German inflation since November 2022. However, it seems that the most important thing of the day was the minutes of the February FOMC meeting. The transcript of the discussion may have triggered a downward reaction in the US market, as more policymakers opted for a repeat of December's half percentage point rate hike. Most participants in the discussion agreed that it was appropriate to raise the target range for the federal funds rate by another 25 basis points, with many saying they were willing to consider a larger range of future hikes to bring inflation back to the target of around 2% as soon as possible. The FOMC reaffirmed that inflation remains elevated, with growing concerns over Russia's actions, as well as the loosening of Covid tightening in China, continuing to contribute heavily to heightened global uncertainty and posing significant risks to continued high inflation. The S&P 500 Index (US500) is down almost 2% this week. Source: Conotoxia MT5, US500, Daily We started Thursday with the Eurozone CPI inflation reading for January. It turned out to be in line with analysts' expectations, coming in at 8.6% and losing momentum for the fifth time in a month. On the same day, we learnt the GDP reading from the United States, which was slightly worse than analysts' consensus at 2.7% (annualised, 2.9% was expected). We also learned about the number of new claims for unemployment benefits: 192,000 (200,000 expected). It seems that despite the economic slowdown, the US economy remains stable. At the end of the week, we learned the GDP results for the German economy. The market now seems to be struggling with a slowdown, as the reading was minus 0.4% m/m. (minus 0.2% m/m was expected) and this is the second consecutive downward reading. The stock market Following the publication of the transcript of the FOMC meeting discussions, shares of companies from almost all sectors of the S&P 500 index were able to fall. The energy sector lost the most, by as much as 3.2%, while the consumer goods sector (up 0.6%) was the only gainer. What may seem interesting is that the declines in the energy sector came despite increases in commodity prices. Natural gas futures prices have risen by almost 8% since the beginning of the week. Oil prices remained unchanged. Source: https://www.sectorspdr.com/sectorspdr/tools/sector-tracker This week we continue with companies' quarterly reports for Q4 2022. On Tuesday, the largest US retailer, Walmart (Walmart), released its financial results. The chain reported earnings per share EPS of US$1.71 (US$1.52 was expected) and higher-than-expected sales revenue. Source: Conotoxia MT5, Walmart, Daily Technology giant Nvidia (Nvidia) delivered a better-than-expected report on Wednesday. EPS came in at US$0.88 (US$0.81 was expected). The company's shares opened the following day 14% above the previous close following the report. On Thursday, US online accommodation and other travel services booking company Booking (Booking) reported better-than-expected EPS of US$24.74 (US$22 was expected). Source: Conotoxia MT5, NVIDIA, Daily The week ended in the red for most companies, with technology giant Alphabet (Google) pioneering the biggest falls, down more than 6%. Source: https://finviz.com/map.ashx?t=sec&st=w1 Currency and cryptocurrency market After the FOMC 'minutes', the US dollar began to strengthen significantly, as could be seen in the quotations of the EUR/USD pair, which has fallen by 1.1% since the beginning of the week. The Australian dollar lost significantly: quotations of the AUD/USD pair fell by 1.6% since the beginning of the week. Source: Conotoxia MT5, EURUSD, Daily We may see a correction in the cryptocurrency market after a successful start to the year. The price of bitcoin has fallen by more than 3% over the course of this week, while ethereum has fallen by 2.9%. bitcoin seems to have stopped at a price of US$25,000. However, despite the recent increases, an outflow of funds from this market could be noticed. The capitalisation of stablecoin fell by almost 2% m/m. Source: Conotoxia MT5, BTCUSD, Daily Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

General Electrics (GE) – a well-known global conglomerate founded by Thomas Edison in 1892 for Edison's incandescent lamps and related products – has expanded over the years through mergers, acquisitions and natural growth. Now it is adapting to a new, more focused business world by splitting into three independent companies. Summary In search of a better business model, GE has decided to split the company into 3 separate entities: GE Healthcare, GE Aerospace and GE Vernova. Breaking up a conglomerate into individual companies can have several benefits, including improved management focus, increased transparency, improved valuation and better capital structure. GE Aerospace division has a well-established and profitable revenue stream. It is currently benefiting from the commercial airline industry's recovery from Covid-19 as well as the US government's emphasis on strengthening the defence sector.  GE Healthcare - the first division to split from the rest of General Electrics - has taken on a significant amount of the company's debt, leaving the conglomerate in a stronger financial position.  GE Vernova - although it may have considerable potential in the future,   currently it seems to be struggling financially due to increased costs of R&D and production.  One of the original 12 Dow constituents has been credited with numerous innovations throughout its rich history, including the first turbine supercharger, engine jet, and gas turbine engines. It was one of the key computer companies in establishing the digital world as we know it today, and two of its employees have been awarded Nobel Prizes for their work within the company.  GE stock price has fallen heavily since its peak of 363 USD during the dot-com bubble. The stock seems to have found ground around the 50 USD level during the pandemic and, since then, has reacted positively to the company's structural changes and overall market growth. Source: TradingView The company is undergoing major structural changes in search of a better business model, including splitting its businesses into independent companies. Before the split, GE had four main segments: Healthcare, Aerospace, Power and Renewables. The first division to separate from the rest of the company was Healthcare - it began operating as an independent company as GE Healthcare in January 2023. The next split is planned for Power and Renewables, which will form a company called GE Vernova. The original company will change its name to GE Aerospace and continue to operate in this segment.  Based on FY2022 revenue streams, GE Aerospace is the largest division of the company - 35%. GE Healthcare accounted for 25% of revenues, Renewables for 18% and Power for 22% (together accounting for 40%).  Source: GE financial statements Conglomerates – not the business model of the 21st century The expansion of GE and many other well-known conglomerates took place at a time when diversification of a business portfolio was seen as an effective way to mitigate risk - when one industry was in a downturn, another might be thriving. Meanwhile, the number of corporate spin-offs over the past decade may suggest that "bigger is better" may not be the current strategy. Breaking up a conglomerate into separate companies can offer several benefits, including improved focus, greater transparency, better resource allocation, improved valuation, better capital structure and increased agility. If we look at recent spin-offs in the healthcare sector, numerous companies, such as Alcon, Envista Holdings, SeaSpine Holdings, and Siemens Healthineers, have managed to separate from their core businesses.  GE can serve as a prime example of the benefits of a break-up, where the value of the individual parts of the company is greater than that of the company as a whole. GE's three main businesses - aerospace, healthcare and power - are very different in nature and therefore have little to gain from being combined. In fact, GE's financial reports suggest that the opposite might be true. The Corporate Items and Eliminations section shows that the company spends a lot of money at the corporate level. For instance, in 2015, the company's earnings from ongoing operations were 1.7 billion USD, while the Corporate Items and Eliminations section totalled 5.1 billion USD. Although these expenses might not be entirely eliminated, creating three separate businesses could save significant money in the long run. Following the separation, each company may be able to focus solely on its core business. Moreover, specialists, analysts and investors could now include each company in their coverage, increasing each company's presence in different investment universes. Although it may not seem like a good reason at first, investor relations, especially with institutional investors, play a crucial role in the success of listed companies.  As the division of the company's business lines is underway, retail investors can also select the business line that corresponds best to their investment strategy, objectives, and views about the most successful sectors in the future.  GE Aerospace – the segment that may have the biggest potential The separation of GE into separate businesses may allow each business to have a clearer focus on its own market position and growth strategy, leading to improved market competitiveness and a clearer focus on its financial performance, leading to improved overall financial performance for each business in the future. Each of the three companies could benefit from the factors discussed, although GE Aerospace may have the greatest potential of the three to outperform as a separate entity.  Firstly, let us review the latest earnings numbers for each division as reported for Q4 2022. The aerospace division had the strongest profit margin for the period. The aerospace division's year-on-year growth may be attributed to the industry's recovery from the pandemic. However, there may be a potential for additional growth as some parts of the world, such as China, are not yet fully recovered. Source: GE financial reports The company predicts continued growth in its aviation engine business. It expects the division's 2023 revenue to jump year-on-year in the "mid-to-high teens" per cent range, with 2023 profits coming in between 5.3 billion USD and 5.7 billion USD. As demand for air travel grows, especially in emerging markets, GE Aerospace could be one of the biggest beneficiaries in the future. According to the International Air Transport Association, global air passenger traffic is expected to double by 2037. As individual airlines and even aeroplane manufacturers, such as Boeing and Airbus, may be significantly affected by economic downturns or such unexpected events as Covid-19, GE Aerospace may also be negatively affected by lower demand. However, GE Aerospace has a strong customer base as it manufactures engines and provides maintenance services to both Boeing and Airbus, which in turn supply aircraft to most major airlines, including United Airlines, Emirates, Delta Airlines and many others.  Even during an economic downturn affecting the commercial aviation industry, GE Aerospace could maintain a stable revenue stream due to its participation in the US government's efforts to bolster the defence sector. As the government emphasises strengthening national security, GE Aerospace stands to benefit from increased demand for defence-related products and services, which could help offset any potential decline in commercial aviation revenue. In addition to already cooperating with Boeing, which is known to receive US government contracts for defence aircraft, GE, on its own, is also receiving contracts from such US government agencies as the Department of Justice, NASA, and Department of Homeland. At the end of 2022, GE Aerospace received a grant of up to 203 million USD to work on new jet engine technologies from the Air Force Life Management Center.  GE Healthcare GE Healthcare had accumulated a large debt burden over the years due to R&D spending and a rather aggressive approach to increasing its market share. Fortunately for the other two segments, this debt has been transferred to the newly formed company and will not weigh on the balance sheet of the remaining business.  The net debt of the newly established company is 8.4 billion USD, which grows to 15 billion USD in case outstanding pension obligations are taken into account. For a company with a market capitalisation of 27 billion USD, 15 billion USD of debt may be a challenge, especially in a rising interest rate environment.   Interestingly, in preparation for the spin-off, GE HealthCare took on debt that was used to buy back 7.23 billion USD worth of debt of the parent company leading to significantly improved capital structure and lowered interest payments for GE (soon-to-be GE Aerospace). Indeed, this put additional pressure on the capital structure of GE HealthCare.  Source: SeekingAlpha GE Renewables Despite its immense potential, the GE Renewables segment may have the most unclear future among the four segments. With revenues lower than a year before and the only division with a net loss, the Renewables segment drives lower the financials of the rest of the company.  Source: GE financial report 4Q 2022  GE Renewables may benefit from the growing demand for renewable energy as more countries adopt renewable energy targets and customers increasingly demand cleaner sources of energy. However, this division faces challenges related to high production costs, limited geographic presence, and potential changes in political and regulatory environments. The production costs of renewable energy technologies are still relatively high compared to traditional energy sources, which could make it more difficult for GE Renewables to compete in certain markets. Furthermore, the many incentives governments offer for adopting renewable energy technologies may become smaller as these technologies become increasingly popular.  Santa Zvaigzne-Sproge, CFA, Head of Investment Advice Department at Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement, or investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Shares of China's largest tutoring companies are up more than 300% from their lows. There is no denying that the Chinese government's blockade of the entire tutoring industry has collapsed this market, which was estimated to be worth approx. USD 120 billion. What is the situation of companies operating in this industry and why have they become a source of interest for Hedge Funds? TAL Education Tal Education Group (TALE), a company that helped children learn during the difficult time of the pandemic, experienced a drop in revenue of more than 84% and the near suspension of its core business a year and a half ago, resulting in its largest loss ever. The Wall Street Journal website characterises the company's current operations as follows: "TAL Education Group has been selling online-learning materials and providing technology solutions to schools." Source: Conotoxia MT5, TALE, Daily The company now appears to be managing to reduce its net loss quarter-on-quarter - to USD 51 million in Q3 2022 - and may be prioritising cost optimisation and debt repayment. The loss from operations fell by 69.7% year-on-year, the volume of debt in turn fell by 5% year-on-year. and now stands at USD 855 million. The $3.3bn in cash that the company can use to continue restructuring and enter new markets could be a lifesaver. Tal Education Group's capitalisation currently stands at USD 4.63 billion, which means that as much as 71% of its value is cash held. From this, it could be concluded that the company currently has a low probability of insolvency with the potential for successful restructuring. New Oriental Education & Technology with interest from Hedge Funds The second company in China's private teaching industry to gain significantly from the slump in this market is New Oriental Education & Technology (NewOriental). Here, shares are already up 380% since the bottom, the company's CEO conveyed in its H1 2022 quarterly report: "It is encouraging to see a continuously strong momentum of our overall business in the second fiscal quarter of this year, which marks a fresh start after downsizing throughout the last fiscal year. Our remaining key businesses started to show a steady trend of recovery after several years of pandemic disruption. In this fiscal quarter, our overseas test preparation and overseas study consulting businesses increased by approximately 17% and 14% year over year, respectively. Simultaneously, our educational new business initiatives sustained a strong growth and generated meaningful profit in this fiscal quarter." New Oriental Education & Technology, in contrast to TAL Education, has posted positive earnings in the last reported two quarters. The company has US$4.2 billion in cash and no debt. Its revenues have now managed to recover to half of their pre-collapse value. The company is currently valued at USD 7 billion, which means that as much as 60% of its value is cash. It seems that, as with TAL Education, the company is currently showing no signs of insolvency risk. Source: Conotoxia MT5, NewOriental, Daily The Bloomberg portal reports, "Hedge funds now have become one of the biggest investor groups of New Oriental — some 36% of publicly disclosed American Depository Receipts of the company were controlled by such investors in December, up from less than 5.6% in October 2021. The hedge funds were initially attracted by the cheap valuation, and bet on the Beijing-based company’s ability to win market share and pricing power after smaller competitors retreated." Hedge funds are the company's five largest shareholders. The largest of these is Baupost Group, Inc (holding 3.41%). They also include the Renaissance Technologies, LLC fund (holding 2.24%) run by what is considered one of the top managers Jim Simons. Sean Ho, manager of one of these funds, states: "New Oriental’s test and English language preparation, book publishing, and corporate training businesses remain unaffected, Ho says, despite the regulatory overhaul wiping out about 50% of its revenue. The firm’s management has paid off all its accounts receivables, started a live-streaming e-commerce business, and shifted the focus of its education segment to non-school curriculum subjects and 10th to 12th grades. It now offers a range of hobby group sessions, ranging from music to chess, calligraphy and dance classes. It’s also been able to charge higher rates than competitors”. However, the industry as a whole seems further exposed to the possible negative impact of possible regulation from the Chinese government. Current valuations of companies in the sector may have the basis to develop new business models with an appropriate level of financial security. Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

China's demand for liquefied natural gas (LNG) is expected to increase by 9-14% in 2023 compared to 2022. - according to forecasts provided by analysts Rystad Energy, Wood Mackenzie and ICIS. However, imports to China are expected to remain below 2021 record levels due to the ongoing impact of the pandemic. According to a report by Goldman Sachs Research, the opening of China after the COVID-19 coronavirus restrictions will not only accelerate the country's economic recovery, but also boost global growth. Due to the faster-than-expected pace of this opening, Goldman Sachs analysts forecast that Chinese GDP will grow by 6.5% year-on-year in 2023. Which markets could be affected? Goldman Sachs predicts a 24% increase in the value of Chinese stocks. Goldman Sachs Group (GS) predicts that the sell-off in the Chinese stock market since the end of January will reverse as China's economic recovery brings strong corporate earnings. The US investment bank predicts that the MSCI China Index (MCHI) could rise by around 24% by the end of 2023 from last week's close. Goldman Sachs' optimistic forecast comes at a time when investors are wondering whether the ongoing rally in Chinese equities driven by economic recovery since November last year is over. Escalating geopolitical tensions and an uncertain outlook for economic recovery caused losses in February after a three-month surge, but China supporters say a key policy meeting scheduled for next month, as well as upcoming financial results, could bring fresh momentum. Source: Conotoxia MT5, MCHI, Daily As we have seen from the Goldman Sachs report, China's re-opening and a rise in domestic demand could lift global GDP by 1% by the end of 2023. This growth could come from three channels: growth in domestic demand,  an increase in international travel,  increased demand for raw materials, including oil. China number one as an importer of liquefied gas China is now making efforts to sign new long-term contracts for the supply of liquefied natural gas (LNG), giving it even greater control over the global market at a time when competition for such supplies is increasing. Chinese companies now sign the most LNG purchase contracts of any country and are increasingly becoming key intermediaries in LNG imports. Chinese buyers are reselling many cargoes at inflated prices in Europe and Asia, resulting in their control over a significant portion of the supply of this crude. Source: BloombergNEF An analysis of BloombergNEF data shows that companies based in China account for about 15% of all LNG supply contracts until 2027. This trend could increase as Chinese companies seek to sign more long-term contracts. China could become one of the world's largest LNG importers almost overnight, thanks to Beijing's efforts to ensure energy security. However, as analysts point out, the Middle Kingdom's position in the market may have two sides of the coin: China could provide stability during periods of global shortages, but it could also lock in supplies and raise prices if it needs to meet domestic needs. "If not for the lower Chinese LNG demand in 2022, the global gas market — and Europe’s energy security — would be in a far more perilous state" - conveyed Shell in its annual forecast report on the fuel. Saul Kavonic, energy analyst at Credit Suisse Group AG, added: "If not for the lower Chinese LNG demand in 2022, the global gas market — and Europe’s energy security — would be in a far more perilous state." It seems that we are now seeing an awakening of the Chinese economy, which may be hungry for gas demand. Therefore, we may now see demand and supply aligning in the price of this commodity, which, if demand from China increases further, could provide an opportunity to reverse its downward trend. Source: Conotoxia MT5, XNGUSD, Daily Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Investors' eyes may turn to next week's key macroeconomic indicators from the EU, particularly Germany, the region's largest economy. Tuesday 21.02. 08:30 GMT, Germany Manufacturing Purchasing Managers Index (PMI) February The German Purchasing Managers' Index provides insight into the construction industry's activity level as reported by purchasing managers. This measure provides an understanding of the state of the German construction industry, as it is assumed that purchasing managers have access to first-hand data on the performance of their companies.   A reading above 50 indicates expansion, while a reading below 50 indicates contraction. The last time the German manufacturing PMI was above 50 was in June 2022, and the preliminary reading for February 2023 is forecast to be 47.9. Falling factory activity has been linked to lower orders amid weaker demand from both domestic and foreign customers, especially Chinese, due to high stocks, elevated prices and slowing investment activity. A higher-than-expected reading could be bullish for the EUR, while a lower-than-expected reading could be bearish for the EUR.  Impact: EUR Tuesday 21.02. 10:00 GMT, Germany ZEW Economic Sentiment February ZEW Economic Sentiment is one of the leading economic indicators of Germany. It is created based on interviewing experts from banks and other sectors about their expectations regarding interest rates, inflation rates, exchange rates, stock markets and other measures, such as the economic development of the world's major economies, in order to develop a sentiment for the German economy for the next six months. The ZEW Indicator of Economic Sentiment is calculated by comparing the number of experts with positive versus negative sentiment. For example, if 30% hold positive sentiment, 20% have neutral sentiment, and 50% hold negative sentiment,then the ZEW index would result in -20%. January's ZEW Economic Sentiment was positive for the first time since February 2022, suggesting that German experts may be turning away from their negative sentiment. If the February 2023 data are also positive, this could confirm the above statement. However, it would be a better-than-expected surprise as the current forecast for ZEW Economic Sentiment this month is -15%.  A positive or less negative result than the forecast could be seen as bullish for the EUR, while a lower (more negative) result could be seen as bearish for the EUR. Impact: EUR Wednesday 07:00 GMT, German CPI (YoY) (January) While the German Manufacturing PMI and ZEW Economic Sentiment will provide the first indicators of German economic strength, the CPI later in the week will show whether the ECB's hawkish policy is succeeding in the fight against inflation.  The CPI measures the change in prices paid by consumers for a given basket of goods and services over a specified period. This information shows changes compared to a year ago. The CPI is the main measure of inflation - a higher index means higher inflation. The preliminary data for January inflation showed a slight increase in inflation from December 2022 (8.7% versus 8.6%), showing that inflationary pressure may not be over. Economists are suggesting that Germany's broad governmental support schemes may be extending the inflationary pressure, although at a lower level.  Higher-than-expected data may have a bullish impact on the EUR and a bearish impact on the stock market, while lower-than-expected data may have a bearish effect on the EUR and a bullish impact on the stock market.  Impact: EUR, DAX Thursday 10:00 GMT EU CPI (YoY) (January) The preliminary result of the EU CPI data for January fell to 8.5% from 9.2% in the previous month, despite the 1% rise in German inflation. Possibly, the higher German data may be the reason why the EU CPI for January is expected to be 9.2%, 70 bp higher than the preliminary figure. The inflation outlook for the euro area and Germany appears to be influenced by two opposing factors. On the one hand, lower-than-forecast energy prices may push down inflation faster than previously thought. On the other hand, the pass-through pressure of energy and commodities inflation to production costs is not yet over, keeping the overall inflation high. Furthermore, as the geopolitical situation in Europe is not improving, the ongoing price negotiations within the agricultural sector may result in higher-than-expected prices giving an additional boost to the inflation numbers.  Higher-than-expected data may have a bullish impact on the EUR and a bearish impact on the stock market, while lower-than-expected data may have a bearish effect on the EUR and a bullish impact on the stock market.  Impact: EUR, DAX, STOXX Stocks to watch Walmart (WMT) announcing its earnings results for the quarter ending on 01/2023. Forecast: 1.51. Positive earnings surprise in 8 out of the last 10 reports. Time: Tuesday, February 21, before the market opens. Home Depot (HD) announcing its earnings results for the quarter ending on 01/2023. Forecast: 3.29. Positive earnings surprise in 10 out of the last 10 reports. Time: Tuesday, February 21, before the market opens. NVIDIA (NVDA) announcing its earnings results for the quarter ending on 01/2023. Forecast: 0.8102. Positive earnings surprise in 9 out of the last 10 reports. Time: Wednesday, February 22, after the market closes. Alibaba (BABA) announcing its earnings results for the quarter ending on 12/2022. Forecast: 16.63. Positive earnings surprise in 8 out of the last 10 reports. Time: Thursday, February 23, before the market opens. Dell Technologies (DELL) announcing its earnings results for the quarter ending on 01/2023. Forecast: 1.65. Positive earnings surprise in 9 out of the last 10 reports. Time: Friday, February 24, 21:30 GMT. Santa Zvaigzne-Sproge, CFA, Head of Investment Advice Department at Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement, or investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

A surprise in US inflation data, a strengthening US dollar, increased economic activity among consumers and a sharp rally in cryptocurrencies despite their legal woes - these are just some of the events of the past week. What else could we have found out? Macroeconomic data The week started with Japan's GDP data for Q4 2022. It reported growth of 0.2% from the previous quarter, which was lower than economists' forecasts of 0.5% growth. Tuesday saw the release of indicators on the UK labour market situation, including the Average Earnings Index and Claimant Count Change for January 2023. The Earnings Index fell by 0.3 percentage points from the last reading, coming in at 5.9% (6.2% was expected), while the Claimant Count fell by 12.9,000 from the previous month (17,900 was expected). The UK100 Index (UK100) hit new historic peaks this week, reaching 8000 for the time being. Source: Conotoxia MT5, UK100, Daily On the same day, we could learn about the CPI and core inflation readings for January 2023 for the US economy. What seems to have surprised analysts was the higher-than-expected CPI reading of 6.4% (6.2% was expected), while core inflation rose by an expected 0.4% month-on-month. This might imply that the level of disinflation is not going in line with previous assumptions, which could force the Fed to increase interest rates further. Shortly after the release of the data, the S&P 500 Index (US500) fell by 1%, eventually ending the week on a return to the levels seen at the end of last week. Source: Conotoxia MT5, US500, Daily On Wednesday, we learned of the UK's CPI inflation reading. Price dynamics in this economy came in below expectations at 10.1% (10.3% was expected). This is the fourth consecutive month of disinflation in the UK. Indicators of US economic activity, such as the volume of retail sales and core retail sales (excluding car sales), came as a positive surprise on the day. Both indicators beat the most optimistic forecasts, coming in at 2.3% m/m. (0.8% m/m was expected) and 3% m/m. (1.8% m/m. was expected). It seems that, despite the economic slowdown and high inflation, consumers have not stopped their desire to make massive purchases. Thursday brought another batch of data from the United States. First, we learned about the number of new applications for unemployment benefits - 194 000 (200 000 was expected), which may indicate that the US labour market remains in excellent shape. Next, we learned about the sentiment among industrial companies in Philadelphia. The Philadelphia Fed Manufacturing Index turned out to be extremely negative, coming in at minus 24.3 points (minus 7.4 points were expected). This is the worst reading since the pandemic, which may illustrate how much of a slowdown in US manufacturing is expected. Finally, there was another dose of producer PPI inflation, whose reading also came in beating analysts' expectations, at 0.7% m/m in January. (0.4% m/m was expected). This appears to have triggered a correction on expectations for future interest rates, with the spread between 2-year and 10-year bond yields at minus 0.76 percentage points, unseen since 1981. It should be recalled that historically negative values have preceded slowdowns or crises. Source: Fred The stock market The accumulation of negative and positive macroeconomic data may have left the market in dismay. Most sectors ended the week at levels seen seven days ago. The waste sector grew the most, rising 1.5% over the week. We could see this in the performance of the Utilities Select Sector SPDR Fund (XLU). In second place was the energy sector, up 1.3%. Source: Conotoxia MT5, XLU, Daily Key company reports for Q4 2022 included Tuesday's report from beverage maker Coca-Cola (CocaColaHSB). Results came in line with expectations, with earnings per share EPS of 0.45. On the same day, we saw a report from short-term rental platform Airbnb (Airbnb), which reported EPS greater than expectations of 0.48 (0.25 was expected). Source: Conotoxia MT5, AirBNB, Daily On Wednesday, US-based multinational technology company that specialises in computer networking and telecommunications Cisco (Cisco) released better-than-expected financial results. Last year's Q4 EPS was 0.88 (0.85 was expected). The company's shares rose more than 9% during the week. And it was one of the strongest-growing companies in the S&P 500 index. Source: Heat map for the S&P 500 index, https://finviz.com/map.ashx?t=sec&st=w1 Currency and cryptocurrency market In the foreign exchange market, we could see a significant strengthening of the US dollar this week. This was particularly noticeable from the quotations of the USD/JPY pair, which rose by more than 2.7%. Source: Conotoxia MT5, USDJPY, Daily Another strengthening of the US dollar was seen on the EUR/USD pair, which has fallen by 0.4% since the start of the week. This is the third consecutive week of dollar strengthening and declines on this pair. Investors may have been amazed by cryptocurrency listings. Despite high inflation and thus the risk of further interest rate rises, the closure of stacking functionality by the Kraken exchange in the US and the ban on the issuance of new stablecoin BUSD, the value of bitcoin rose by more than 9%. In contrast, the value of the overall stablecoin market may have stalled. Source: Conotoxia MT5, BTCUSD, Daily Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

And we've got it! 77 Q4 2022 held investment reports from superinvestor funds. What did the best of the best in this market invest in and walk away from, and what can we learn from this?  First, the highlights The 13F report is a form that investment funds in the United States must file if they control or manage assets of $100 million or more. Form 13F contains information about investments in individual listed companies, including the number of shares and the value of those investments at the end of each quarter. This information is publicly available. The most frequently held companies currently in superinvestors' portfolios are: Google (Alphabet) - as many as 31 times, Microsoft (Microsoft) - 30 times, Meta Platforms (Facebook) - 25 times, Amazon.com (Amazon) - 24 times and Visa (Visa) - 24 times. We have already had the opportunity to discuss the portfolios of George Soros and Warren Buffett. This time, however, let us look at their activities collectively. The most frequently bought companies By far the most frequently bought company was e-commerse giant Amazon.com (Amazon), which was snapped up by as many as 15 super-investors. This seems interesting particularly given the problems of the consumer goods sector, which seems to be particularly negatively affected by the economic slowdown and high interest rates. Amazon currently accounts for 1.62 per cent in the value of all superinvestor portfolios. Source: Conotoxia MT5, Amazon, Daily The second most bought company was technology giant Meta Platforms (Facebook), which was acquired by as many as 13 super-investors in Q4 2022. Following problems with its - seemingly misguided - investment of more than $13 billion in the Metaverse, the company announced a 13 per cent job cut. The cost reduction may have improved investor sentiment, as the company's shares, after falling as much as 78 per cent, have now rebounded 122 per cent from the bottom. Meta accounts for 1.31 per cent of the value of all superinvestors' portfolios. Source: Conotoxia MT5, Facebook, Daily The third most bought company was another tech giant that has recently become famous for its investment in artificial intelligence - Microsoft (Microsoft). It was bought by as many as 11 of the super-investors. The company is now the largest position among all funds, accounting for as much as 2.36 per cent of their portfolios. Source: Conotoxia MT5, Microsoft, Daily In fourth place was Microsoft's biggest competitor, Google (Alphabet), which appears to be focusing on creating a tool such as ChatGPT. The company was bought by nine super-investors in the last quarter of last year, and its shares accounted for 1.52 per cent of the value of funds' portfolios. Source: Conotoxia MT5, alphabet, Daily The most sold companies Interestingly, the most sold company turned out to be the previously mentioned Microsoft. It was sold by 14 super-investors. The largest buyer was Daniel Loeb (Third Point fund), who increased the company's stake by 4.75 per cent of his portfolio, and the largest seller was John Armitage (Egerton Capital fund), reducing the company's stake by 5 per cent of his portfolio. Ex aequo with Microsoft was the world's largest payment service provider, Visa (Visa), also sold by 14 super-investors, with only four of them buying its shares. Viking Global Investors fund bought the largest stake, accounting for 0.46 per cent of its portfolio value, while Lee Ainsile (Maveric Capital fund) opted for the largest sale with 1.32 per cent of its portfolio value. It appears that the reluctance to buy the company may be linked to expectations of reduced consumer activity in the coming quarters. Source: Conotoxia MT5, Visa, Daily In third place were Google shares sold by 12 of the super investors. China's Li Lu (Himalaya Capital Management fund) seems to be by far the most optimistic about the company's future. He increased the company's stake by as much as 7.3 per cent of the value of his portfolio. The biggest pessimist, on the other hand, was Josh Tarasoff from the Greenlea Lane Capital fund. He reduced his position in the company by 2.2 per cent of the value of his portfolio. What conclusions can we draw from this? Based on the investments of all super investors, it is therefore difficult to identify the best and worst assets. This may be due to the fundamental issue of different investment styles and strategies. Therefore, drawing conclusions from the investments undertaken should be preceded by an understanding of the style of the fund in question and its assumptions for entering and exiting positions. Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

On Monday (13.02) we were able to learn about the SOROS FUND MANAGEMENT fund's 13F report, a periodic report to the US Securities and Exchange Commission (SEC). The Form 13F contains information about the value and number of shares held, as well as the value of investments and the type of investment assets the investor has in its portfolio, for the last quarter. What has George Soros' fund invested in? Who is George Soros? George Soros was born in Budapest in 1930 to a Jewish family. During World War II, his family avoided deportation to concentration camps through false documents and hiding. Soros later studied at the London School of Economics, where he met the philosopher Karl Popper, whose ideas had a strong influence on his thinking. In the 1960s Soros embarked on a career as an investor and founded the Quantum Fund hedge fund, which brought him huge profits and made him one of the richest people in the world. Soros has also gained notoriety for his philanthropic activities, in which he supports projects for, among other things, democracy, human rights and press freedom around the world. One of the most important of these is the Open Society Foundations. Soros has been criticised by many individuals and groups for his influence on politics and the media. Some critics have accused him of manipulating financial markets and even attempting to overthrow state governments. He has also faced criticism for his involvement in migration and refugee issues. Today, Soros is still considered one of the most influential people in the world. SOROS FUND MANAGEMENT LLC is a private investment firm founded by a billionaire in 1969 and specialises in investments in various asset classes including equities, bonds, real estate and commodities. SOROS FUND MANAGEMENT LLC manages investment funds for institutional clients, such as pension funds and hedge funds, as well as for its own family. George Soros is known for his active approach to investing, which involves conducting intensive market analysis and using knowledge of political and economic circumstances to make investment decisions, also taking into account analyses of market trends and the macroeconomic situation. Soros focuses on long-term investments, yet his firm has become known for conducting speculative activities in financial markets, including his involvement in the spectacular sale of the pound sterling in 1992, which appears to have led to the UK not adopting the euro. At the same time, however, it is worth noting that Soros' investment style has evolved, and that SOROS FUND MANAGEMENT LLC itself invests in a variety of asset classes in line with market trends and economic circumstances. What does the SOROS FUND MANAGEMENT fund invest in? Soros' fund currently has as many as 208 positions of various types of assets. In Q4 2022, it concluded as many as 85 new positions in its portfolio. The largest purchase occurred on units of the IBOXX INV CP ETF (LQD), which tracks the iBoxx USD Investment Grade Corporate Bond index. This index contains bonds with a duration of more than one year issued by companies with high credit security. Interestingly, at the same time he bought put options (PUT) on this fund of the same value. This appears to be a hedge against interest rate volatility while receiving a dividend from the fund, which is at 3.4% per annum. The two positions together represent 7%, of the value of the fund's portfolio. In addition, it entered into a short position on units of the iShares iBoxx $ High Yield Corporate Bond ETF (HYG) in the form of a PUT option. The position represents another 2% of the fund's portfolio. This appears to be an attempt to bet on further interest rate rises by the Fed, which could cause declines in bond prices. Read next: GBP/USD Pair Rose Sharply Above $1.22, EUR/USD Pair Also Rose| FXMAG.COM Source: Conotoxia MT5, LQD, Daily The second largest purchase Soros made in the last quarter of 2022 was shares in First Horizon Corporation (1stHorizon), a US-based holding company that offers a variety of banking and financial services to individuals, businesses and institutions in the United States. The investment in the company currently represents 2.9% of the fund's value. Source: Conotoxia MT5, 1stHorizon, Daily Soros appears to be fixated on gains in the S&P 500 (US500) index. In Q4 2022, he purchased units of the SPDR S&P 500 ETF Trust (SPY) representing 1.8% of the portfolio value. Source: Conotoxia MT5, US500, Daily Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The US State Department is considering approving the sale of HIMARS artillery missile systems to Poland for $10bn. The deal will include 18 launchers and long-range munitions. We were able to learn from a release from State Department officials that providing the weapons to Poland would meet US foreign policy objectives by: "improving the security of a NATO Ally that is a force for political stability and economic progress in Europe". It seems that the manufacturer of this armament could particularly benefit from this contract. Is Lockheed Martin Corporation the Cyberdyne Systems from "Terminator" movie? Lockheed Martin Corporation (Lockheed) is one of the largest manufacturers of military equipment and weapons technology in the world. The company was founded in 1912 and is headquartered in Bethesda, Maryland. Lockheed Martin is a supplier of military combat aircraft (37.7% of revenue), missiles (19.1% of revenue), air and missile defence systems (23.2% of revenue), satellites and space programmes (29.6% of revenue) and other vital systems to militaries and government agencies around the world. The company also researches and develops new technologies related to weapons and security. The comparison to Cyberdyne Systems may at first glance seem exaggerated. Nevertheless, it is one of the three largest companies in the US military sector. To a large extent, it could influence the military destiny of the world. Lockheed Martin's business model is based on the sale of defence and security products and services. The company's main source of revenue is the sale of military products and weapons technology. The company also earns money by providing maintenance services and upgrades for its products, as well as by working with other companies to develop and market new technologies. Financial situation The company's shares have risen by more than 23% since the outbreak of the conflict in Ukraine. From the last published report for Q4 2022, we could learn that Lockheed Martin's revenue increased by only 7% year-on-year. Despite the increase in revenue, the company's operating profit fell by 6.6% year-on-year. This appears to have led to the company's net profit margin falling to 8.7% (previously 9.1%), which is still better than the industry average of just 1.9%. According to analyst firm Zacks: 'Steady contract flows and subsequent backlog growth bolster its long-term revenue prospects. Budgetary provisions tend to boost its business. Yet strains between the U.S. and Turkey, as a result of the latter accepting Russian products, might hurt Lockheed's component supply from that country. Lockheed is facing performance issues concerning some of its products, which, in turn, may hurt its results. Also, an uncertainty revolving around the possible sanction by China on Lockheed might impact the company’. Including the aforementioned USD 10 billion worth of equipment sales to Poland, the company's revenue growth would be as much as 27%. It seems that this is why the number of 'strong buy' recommendations has increased from three in January to the current seven. What does Wall Street think of Lockheed Martin's share price? According to the Market Screener portal, the company has 22 recommendations, and among these, the majority are those with the content: "Hold" and "Buy". The average target price is set at USD 502.3, 7% above the last closing price. The highest target price is at USD 774 and the lowest is USD 334. Source: Conotoxia MT5, Lockheed, Daily Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

A considerably calmer week ahead compared to this week, at least in terms of the economic calendar.  Monday 06.02. 09:30 GMT, UK Construction Purchasing Managers Index (PMI) January UK Purchasing Managers Index provides insight into the activity level within the construction industry as reported by purchasing managers. This measure gives an understanding of the condition of the UK construction industry, as purchasing managers are considered to have access to first-hand data on their company's performance.   A reading above 50 indicates expansion, while a reading below 50 indicates contraction in the construction industry. UK construction companies have signalled a resuming slowdown in business activity growth since the November data came out, reflecting slower demand and reduced risk appetite due to higher borrowing costs and uncertainties about the economic outlook. The forecast for the January PMI is 49.6, indicating a slight contraction in the construction sector.  Higher than expected reading may have a bullish effect on the GBP, while a lower-than-expected reading could be bearish for the GBP.  Impact: GBP Tuesday 07.02. 13:30 GMT, US Trade Balance (Dec) The trade balance measures the difference in value between imported and exported goods and services during the reporting period. A positive figure indicates that more goods and services were exported than imported. The US trade balance has historically been negative, and a worsening trend could be observed over the long term. In March 2022, the US trade balance surpassed -100 billion USD for the first time in history, and since then, it has fallen to -61.50 billion USD, according to the November data. December's data are expected to show a slight deterioration to -68.70 billion USD. A higher-than-forecast reading may be seen as bullish for the USD, while a lower-than-forecast reading (larger negative number) may be interpreted as bearish for the USD. An outflow of USD from the country and lower foreign demand for US products during a trade deficit could lead to a depreciation of the currency, which in turn may boost the country's exports as its goods become cheaper for the rest of the world. Impact: USD Read next: Japanese Startup Aerwins Technologies Will Be On NASDAQ| FXMAG.COM Friday 10.02. 13:30 GMT, Canada Employment Change (Jan) The employment change report shows the change in the number of people employed, which is an essential indicator of consumer spending. While an increase in the number of people in employment usually signals a positive move in economic expansion, market participants may be hoping for a lower number as this would indicate that the central bank's tightening policy is working and further interest rate hikes may not be necessary.  Previous figures for employment changes in Canada have been very volatile. While August saw a decline (-39.7 thousand jobs), September and November showed slight gains (+21.1 thousand and +10.1 thousand jobs, respectively), followed by increases of over 100 thousand in October and December. Friday's data for January are expected to show a possible increase of 8 thousand.  A higher-than-forecast reading may have a bullish effect on the Canadian dollar and a bearish effect on the stock market. In contrast, lower-than-forecast reading may have a bearish impact on the Canadian dollar and a bullish effect on the stock market. Impact: CAD, S&P/TSX Composite Index Stocks to watch Activision Blizzard (ATVI) announcing its earnings results for the quarter ending on 12/2022. Forecast: 0.7946. Positive earnings surprise in 7 out of the last 10 reports. Time: Monday, February 6, after the market closes. Walt Disney (DIS) announcing its earnings results for the quarter ending on 12/2022. Forecast: 1.51. Positive earnings surprise in 7 out of the last 10 reports. Time: Wednesday, February 8, after the market closes. AstraZeneca ADR (AZN) announcing its earnings results for the quarter ending on 12/2022. Forecast: 0.6825. Positive earnings surprise in 7 out of the last 10 reports. Time: Thursday, February 9, before the market opens. PayPal Holdings Inc (PYPL) announcing its earnings results for the quarter ending on 12/2022. Forecast: 1.19. Positive earnings surprise in 9 out of the last 10 reports. Time: Thursday, February 9, after the market closes. Santa Zvaigzne-Sproge, CFA, Head of Investment Advice Department at Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement, or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

At the end of last year, we could learn that China's budget deficit reached record highs from January to November 2022. The property crisis and the zero-tolerance policy for COVID-19 may have contributed to this, with fiscal spending outstripping revenue by US$1.1 trillion and being twice as large as the year before. However, it seems that we may  see a light at the end of the tunnel in the form of a loosening of the pandemic policy. Is it worth investing in shares of Chinese companies? Macroeconomic data from China Official figures from China say that the increase in the deficit was due to a fall in land sales, a fall in tax revenues and an increase in health and welfare spending, which was linked to the coronavirus outbreak. The authorities in the Middle Kingdom now appear to be under pressure to cut spending, as the deficit target has remained unchanged. Public finances are forecast to probably improve in 2023, when China exits the zero COVID policy completely. This could be seen from the latest readings of the PMI sentiment index for the industrial sector, which exceeded expectations and rose to 50.1 points (49.8 expected), up from 47 points in the previous month. The future outlook appears to be improving, as evidenced by increases in the share prices of Chinese companies. The ChinaH Index (CHINAH) has risen 50% from its October lows. This seems to have broken a 2-year slump. Nevertheless, a correction could be expected in the near term, so caution should be exercised when investing in this market. Source: Conotoxia MT5, CHINAH, Daily Pandemic situation According to WHO data, the weekly record of confirmed infections of more than 40 million cases was in the second half of December 2022. Since then, the number of weekly infections has fallen to the 175,000 cases recorded last week, a reduction of 99.5 per cent. However, it should be noted that the Chinese authorities have ended their mass testing programme, so the latest data may not be very reliable. Up to 89.5 per cent of the Chinese population is fully vaccinated. According to official data from November 2022, Chinese health services have already vaccinated 40 per cent of people over 80 with two doses of vaccine and a booster dose. China has now set a target of vaccinating 90% of the elderly by the end of January. The difference in the percentage of the population fully vaccinated was a result of the focus on vaccinating working-age people first. It seems that by reducing the number of tests performed and the number of new vaccinations, China may be optimistic about the future of the pandemic situation. Read next: AUD/USD Pair Remains Under Strong Selling Pressure, The EUR/USD Pair Has Been Falling But Remains Above 1.08$| FXMAG.COM Source: WHO, China confirmed Cases What lies ahead? Looking, among other things, at the purchases of the largest mutual funds, which in a recent Bank of America research report declared that emerging market equities, including China's, are most prevalent in their portfolios. We can assume that, in the long term, these shares appear to be an attractive investment.     Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The past year has been difficult for everyone, especially those invested in financial markets. Moreover, if you are a central bank with a large amount of money, there may be few viable investment opportunities. While a private investor may choose to "sit this one out", central banks may not have that option due to monetary policy and other reasons. Summary Swiss National Bank has reported a loss of 132 billion CHF for the first three quarters of 2022 – 5 times larger than the previous record.  Over the years, SNB had engaged in aggressive foreign exchange purchases accumulating a 1.05 trillion CHF balance sheet intending to keep the Swiss franc from appreciating.  The large exposure to foreign assets suffered massive losses during the first three quarters of 2022 as most currencies, fixed-income securities, as well as equities depreciated.  Due to this, SNB has already announced that it will not be able to provide the annual payout to the Swiss government and cantons (for the second time only since 1908).  Questions remain - will this change investors' view of the franc as a safe haven and is the SNB planning to make changes to its current monetary and investment policy that will not lead to such a loss? Swiss National Bank surprised everyone with the most significant loss in its history, posting an annual loss of around 132 billion CHF, more than 5 times the previous record. Source: Bloomberg Why did it happen? The bulk of the loss - 131 billion Swiss francs - came from the collapse in the value of foreign currency investments accumulated over decades of buying to weaken the national currency.  Indeed, Switzerland has continuously invested large sums in foreign exchange markets and bought foreign equities to keep the franc from appreciating. After the EUR/CHF exchange rate fell from 1.67 in November 2007 to 1.12 in July 2011, the SNB announced that it had decided to do whatever was necessary to keep the EUR/CHF exchange rate above 1.20. Looking back, we know that "whatever it takes" amounted to almost 300 billion CHF until early 2015 when the 1.20 exchange rate ceiling was abandoned.  The last hit was the Covid-19 pandemic which pushed Switzerland to spend 110 billion CHF on the foreign currency markets while trying to apply brakes on the Swiss franc's appreciation as investors fled to safer currencies and other assets. In fact, as a result, the US labeled Switzerland a currency manipulator due to its aggressive foreign exchange market interventions. The US has not been the only country to express objections to Switzerland's activities to keep its currency from appreciating. During its 1.20 exchange rate pledge, it started purchasing German government bonds pushing their yields into negative territory. Graph: investing.com, comments: author As a result of the aggressive policy of the Swiss National Bank, it accumulated enormous amounts of foreign currencies and other assets on its balance sheet. By the end of 2021, the SNB's balance sheet exceeded 1.05 trillion CHF, which equals 144% of the country's GDP. To put this into perspective, the US Federal Reserve's balance sheet at the time was only 34% of the country's GDP, ECB's balance sheet – 67%, and China's – 32%. Since then, the SNB has started to reduce its balance sheet - by December 2022, SNB had reduced its foreign exchange reserves to 784 billion CHF. That affected the national currency, which slipped below the parity against the euro for the first time in history (except one day when the 1.20 rate limit was renounced). SNB's holdings Now, the considerable exposure to foreign currency holdings does not induce losses per se. But last year, financial markets wiped out not one fund and portfolio. And in times like these, it is more important than ever to be well diversified. At the end of the third quarter of 2022, the SNB's foreign exchange holdings included mainly fixed-income securities, equity securities, and cash. At the end of 2021 – before the plunge in the US tech sector – SNB held US stocks worth 166 billion USD, including shares in Apple, Microsoft, Amazon, Tesla, Alphabet, Meta, and others. Source: Swiss National Bank interim results The above graph shows that all key foreign currencies depreciated against the Swiss franc, except the US dollar. Unfortunately, nearly half of the investments in the US dollar were through US stocks, which greatly lost value during this period.  Furthermore, last year was unique because bonds, typically considered a safer alternative to equities during downturn periods, fell together with riskier assets due to increasing interest rates. In total, during the first three quarters of 2022, Swiss National Bank reported a loss of 70.9 billion CHF due to price fluctuations in bonds, a loss of 54.2 billion CHF due to price fluctuations in equities, and an additional loss of 24.4 billion CHF related to exchange rate changes. The full-year report is expected to be published in March 2023. What now? The Swiss cantons are tightening their belts. As a result of the large loss, not only the bank's shareholders will not receive the awaited payments in the form of dividends. Swiss National Bank will not be able to make its yearly payment to the government and cantons. Although the SNB's annual payments tend to fluctuate widely and are not binding, many of the 26 cantons have already started to adjust their spending plans for this year to reflect the lack of payment. Read next: AUD/USD Pair Remains Under Strong Selling Pressure, The EUR/USD Pair Has Been Falling But Remains Above 1.08$| FXMAG.COM Does this affect Switzerland's attractiveness in the eyes of investors? The conclusions drawn by the SNB and investors may be different and uncertain. It is possible that the SNB has abandoned its target of a EUR/CHF rate above 1.20. We can see that although the exchange rate is well below this level, SNB has stopped increasing its balance sheet (potentially due to the harsh earnings results at the end of Q3). The Swiss National Bank's large loss may also be a lesson to other central banks that it is challenging (if not impossible) to regulate the value of the national currency, especially by acting alone, and even more so when the currency represents a negligible part of the world's foreign exchange reserves.    While some investors may have had an impression that the Swiss franc’s value is being affected by its central bank already before, recent developments and the extreme loss of the SNB have attracted the attention of a myriad of investors all around the world. It may lead to investors rethinking their opinion of the Swiss franc as a stable, safe currency that can be trusted during turbulent times.  Furthermore, it will certainly be interesting to monitor the Swiss National Bank and whether or not it chooses to amend its monetary policy to avoid similar situations in the future.    Santa Zvaigzne-Sproge, CFA, Head of Investment Advice Department at Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement, or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Yesterday (23.01), OpenAI - the technology company that is the creator of the ChatGPT language model - reported in an announcement the entry into the next phase of its expanded partnership with Microsoft. We will learn the latter's quarterly report today after the close of trading. What could we learn from the announcement and what can we expect from the company's financial results? The history of these two companies The non-commercial organisation OpenAI was founded in 2015. Elon Musk, Ilya Sutskever, Greg Brockman and Wojciech Zaremba. The company's goal is to promote and develop artificial intelligence in a responsible and safe way for humans. Microsoft has been working with OpenAI since 2019. As part of this collaboration, Microsoft is providing the Azure cloud as a platform to run OpenAI models, as well as supporting the development and exploration of new artificial intelligence technologies. In 2020. Microsoft and OpenAI announced a collaboration to develop GPT-3, one of the largest language models in the world. In 2021. Microsoft invested $1 billion in OpenAI. We have now heard of a further investment of $10bn. As the company states in the announcement: “We’ve worked together to build multiple supercomputing systems powered by Azure, which we use to train all of our models. Azure’s unique architecture design has been crucial in delivering best-in-class performance and scale for our AI training and inference workloads. Microsoft will increase their investment in these systems to accelerate our independent research and Azure will remain the exclusive cloud provider for all OpenAI workloads across our research, API and products" Supporting programmers and graphic designers is the next step "We’ve partnered with Microsoft to deploy our technology through our API and the Azure OpenAI Service—enabling enterprise and developers to build on top of GPT, DALL·E, and Codex. We’ve also worked together to build OpenAI’s technology into apps like GitHub Copilot and Microsoft Designer." - the OpenAI announcement continued. It follows that we will see the use of artificial intelligence in tools such as GitHub, an app to support developers' work, and Microsoft's new Designer service for graphic design. It is intended to compete with Canva, which currently has around 100 million active users. Can we expect a surprise from Microsoft's report? The tech giant's business falls into three main categories: Productivity and Business Processes (productivity and business process support tools), Intelligent Cloud (all cloud computing services) and More Personal Computing (mainly Windows or gaming). Historically, these segments have accounted for a similar share of the company's revenue, but especially in recent years, cloud services are starting to play a key role, increasing their share to 40 per cent. According to Zacks, a portal that analyses financial data and predicts possible surprises in financial results, the Zacks Earnings ESP (expected prediction surprise) ratio is currently at 0.34 per cent, which means that  it might be less possible to be a significant surprise relative to expected earnings per share in Q4 2022. This currently stands at USD 2.3 (previously USD 2.29). What does Wall Street think of Microsoft's share price? According to the Market Screener portal, the company has 51 recommendations, and among them, the predominant one reads: "Buy". The average target price is set at USD 291.72, 20 per cent above the last closing price. The highest target price is at USD 411 and the lowest is USD 212, which is below the last closing price. Source: Conotoxia MT5, Microsoft, Daily Grzegorz Dróżdż, Market Analyst of Conotoxia Ltd. (Conotoxia investment service)  

The ZEW Index is a survey of the economic sentiment of financial market experts in Germany. It measures expectations for the German economy over the next six months. The survey is conducted by the Centre for Economic Research (ZEW). The indicator is based on responses from analysts and economists from banks, insurance companies and other financial institutions. It is regarded as an important indicator for assessing economic activity in Germany and is closely monitored by many investors. Currently, the value of this indicator has reached a positive reading for the first time since February 2022 (16.9 points), which could mean that the situation of this economy could be improving. What else could we learn from the survey? Evaluation of the economic situation The January survey was conducted among 179 analysts and specialists. Regardless of the region assessed, the majority of specialists view the current economic situation negatively. The worst performer here is China, where as many as 77% of respondents view the current economic situation negatively. Second from the bottom is Germany with 60.3%. What may seem interesting is the mildly negative assessment of the US economy, currently at minus 5 points, which is a drop from the previous positive reading of 6.8 points.China also ranks first in terms of perceptions of the future. As many as 58.9% of respondents answered that the situation for this economy would improve (previously 41.9%). This may be linked to the expected easing of the 'zero COVID' policy. Similarly, respondents answered about the behaviour of the SSE Composite index (56% positive responses), to which we could gain exposure through the iShares MSCI China ETF (MCHI). Source: Conotoxia MT5, MCHI, Weekly The future of the German economy was assessed similarly to the euro area as a whole. The ZEW index reached 16.9 points and 16.7 points respectively. This is a significant improvement on the previous reading, which rose by more than 40 points in both cases. 44% of specialists forecast that the value of the DAX index (DE40) would increase, while 38.1% of respondents believe that it would remain unchanged. There is a noticeable improvement in sentiment relative to the last survey for all indices. Source: Conotoxia MT5, DE40, Weekly Despite the negative reading of the ZEW indicator for the future of the US economy, at minus 6.7 points, we continue to see an improvement on the last reading, which was minus 23.3 points. One could conclude that more important than the value of a given indicator is its trend of change. A more optimistic view is taken of the future of the Dow Jones Industrial index (US30), with 48.2% of respondents expecting it to increase in value (previously 41.1%), while 31% believe it would remain unchanged. Source: Conotoxia MT5, US30, Weekly The foreign exchange market and interest rates The survey questions also focused on two currency pairs: the euro to the US dollar and the euro to the Chinese yuan. In both cases, survey's experts expect a significant strengthening of the European currency. The biggest change is expected for the EUR/USD pair, where as many as 53.5% of respondents expect an increase (previously 46.2%) and 33.5% assume no major change. Source: Conotoxia MT5, EURUSD, Weekly The positive attitude towards a strengthening of the euro appears to be linked to interest rate expectations. Almost unanimously, 87.1%, respondents were in favour of an increase in euro area interest rates in the short term. However, they are less positive about increases in the long term (we could assume more than six months), where 48.3% of respondents expect rates to rise and 36.5% expect no change. In second place in terms of expected interest rate increases is the United States. 79.2% of respondents see a further tightening of monetary policy in the forthcoming FOMC decision. In the long term, 38% of respondents expect an increase and 39.8% expect no change. These expectations seem to be reflected in US bond yields. Long-term 10-year bonds have lower yields than short-term ones (e.g. 2-year bonds). Currently, this difference is 0.65 percentage points. This situation may seem illogical, as why would we want to receive less for holding our funds longer. Historically, a similar relationship has usually heralded a period of recession or slowdown in the economy, which, it seems, we are beginning to feel today. Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service)

Investors are used to following the changes in interest rates and perceive it as one of the key macro indicators affecting stock market returns and general sentiment. Meanwhile, another less discussed indicator may have an even stronger influence on the stock market returns, especially in the long term. This indicator has a substantial impact on the said interest rates, among other factors. Summary The country’s central bank regulates the money supply in the economy by purchasing or selling debt securities. Higher money supply leads to lower interest rates, higher business activity, and higher sales, positively affecting the stock market. Historically, the US money supply grew at a steady rate of nearly +0.50% per month, which was accelerated to support the economy amid the Covid-19 pandemic – the Fed added about 5 trillion USD to its balance sheet until April 2022. Recently, the Federal Reserve has obtained a money supply reduction policy to remove from its balance sheet value that was amassed during the pandemic and to combat the high inflation while slowing down the economy. The stock market may not be able to change its course as long as the Fed continues to decrease the money supply. Money supply The money supply in the economy is regulated by the country’s central bank (or Federal Reserve in the United States). To increase the money supply, the central bank would purchase government debt securities. For decreasing the money supply – the opposite would happen – the central bank would sell the government debt securities. Higher money supply in the market leads to lower interest rates (cheaper money), higher spending, and higher inflation – all of which typically boost stock returns. M2 money supply appreciated almost linearly until February 2020 at a steady rate of nearly 0.50% per month. As the US Federal Reserve accelerated quantitative easing in order to support the economy due to Covid-19 pressure, the money supply growth rate surged to an average of 1.38% per month and continued until March 2022. Starting from April 2022, the US M2 money supply has been decreasing at an average rate of -0.21% per month.  Source: FRED, graph: Author  Reductions in money supply have taken place in history, although smaller and less consistent. Since January 1959, reductions in money supply have occurred 34 times (4.44% of the 776 readings), with an average decrease of -0.16% (-0.13% if excluding the recent outliers) and a median decline of -0.072%. Meanwhile, four out of the ten most significant reductions within this period occurred this year, with an average decrease of -0.41%. If the Fed aims to return to the money supply level corresponding to the linear growth path characteristic of the period before the Covid-19 pandemic, it would have to reduce the money supply by -0.50% monthly until February 2024, when it would reach 19,764 billion USD. Fed’s balance sheet As the Fed engaged in growing the money supply to support the US economy during the Covid-19 pandemic, its balance sheet blew up more than twice to nearly 9 trillion USD. The Fed’s balance sheet doubled during the 2008 Global Financial Crisis and again in its aftermath by the end of 2014. Now, the same as previously, the Fed wants to reduce its balance sheet to a more stable level. Although, this time, the Fed has chosen a considerably more aggressive strategy. In June 2022, the Fed started its balance sheet normalization process by letting 47.5 billion USD worth of assets mature and roll from its balance sheet. The same happened in July and August. However, in September, the Fed decided to speed up the process and doubled the value of assets to be rolled from its balance sheet to 95 billion USD. Source: https://www.federalreserve.gov/ Total assets of the Federal Reserve, 01.01.2020.-20.12.2022. Based on the data available until December 20, 2022, the Fed kept the pace of removing assets off its balance sheet in October and November. Since its peak on April 12, 2022, the Fed balance sheet has been reduced by 401 billion USD. Jerome Powell and other Federal Bank officials have not stated how far they are planning to extend the balance sheet reduction. However, they have indicated that they don’t see any reason for the reduction slowdown. On November 30, Jerome Powell suggested that the Fed doesn’t want to repeat 2019 when the reserves were drawn down too much, but also that “we are not close to reserve scarcity”. For comparison, let us review the Fed's activities the last time it entered the path of reducing its balance sheet. Last time, the Fed waited almost two years since the first interest rate hike to start reducing its balance sheet – compared to just 3 months this time. Furthermore, previously the Fed chose to gradually increase the assets’ value to be rolled off its balance sheet within 12 months until it reached a 50 billion USD per month peak. This time, the Fed started with almost the same value – 47.5 billion USD – and just after two months, doubled it. Based on the data above, it may be concluded that the Fed is on a more hawkish path than before. Why is this important? As discussed previously, the stock market generally enjoys an elevated money supply and generates corresponding returns to investors. Still, how strongly does the money supply impact the stock market? Based on the end-of-month data for M2 money supply and S&P 500 closing price since the beginning of 2013, the correlation between the two measures is impressive: 97%. Meaning that almost every time the money supply grows, so does the S&P 500. Based on the historical changes of both measures, we see that the S&P 500 index is more volatile – on average, for every 1-point move in money supply, S&P 500 moves 1.47 points. If the money supply were to be reduced by another -7.71% to reach the level corresponding to the linear growth path characteristic of the period before the Covid-19 pandemic, the S&P 500 might follow with a -11.33% drop by the end of 2023. It is crucial to note that the above-described scenario considers only one measure and its impact on the S&P 500 based on historical data to reflect the money supply’s significance in the stock market’s movements. In reality, other predictable and unpredictable events may significantly impact the stock market’s movements this year. Furthermore, the Fed may change its stance at any point based on the prevailing market conditions. Stay safe, stay informed, and be well-diversified. Santa Zvaigzne-Sproge, CFA, Head of Investment Advice Department at Conotoxia Ltd. (Conotoxia investment service)

The price of bitcoin (BTCUSD) has risen by more than 26% since the beginning of the year, dynamically breaking through resistance near US$18,000. Currently, the price of the largest cryptocurrency is at levels before the collapse of the FTX exchange. The thaw in bitcoin appears to have pulled most of this market down. The average increase for the 80 largest cryptocurrencies since the beginning of the year is 37%. Is this already the start of a new bull market in this market, or is it just a so-called "dead cat bounce"? Why these increases in the crypto market? Significant rises in cryptocurrency prices appear to have followed Tuesday's conference by Jerome Powell, head of the Federal Reserve. Analysts may have interpreted his words as announcing the end of the interest rate hike cycle. Just two days later, we saw another reading of falling CPI inflation in the US from 7.1 to 6.5% year-on-year, which could also drive cryptocurrency listings. Today, the prices of many of them have returned to pre-crisis levels related to the bankruptcy of FTX, the third largest cryptocurrency exchange. Source: Conotoxia MT5, BTCUSD, Daily The collapse of cryptocurrency exchanges, which tended to play with their customers' money for their own account, may have significantly cleansed this market. The winner in this process now appears to be the Binance exchange, which has increased its level of trading share to 66.7%. The company has registered with the Swedish financial regulator to continue its regulation in Europe, having already done so in several EU countries, including France. In addition, Binance.US, the platform's US division, announced that it is buying the assets of bankrupt platform Voyager Digital for $1 billion, which would allow Voyager customers to recoup some of their deposits. The exchange also announced that it intends to hire 3,000 people in various positions by 2023. The value of the BinanceCoin (BNBUSD) cryptocurrency, which seems to have followed the company's success and failure, has grown by more than 21% since the beginning of the year. Source: Conotoxia MT5, BNBUSD, Daily What could we expect in the future? Director of Strategy at Wave Financial Les Borsa announced: "Bitcoin and crypto tend to run ahead of equities when it comes to macro shifts and pivots, so we’re probably seeing signs of this happening right now. It seems as though more and more investors are gradually allocating more and more capital to Bitcoin and crypto. This will likely continue, and possibly accelerate, barring any exogenous shocks to the macro situation". Looking at the current macroeconomic schedule for the US main market, the key data we may learn about on Wednesday, in the form of the PPI inflation reading, as well as on 1 February, in the form of the FOMC interest rate decision. By these publications, however, we could expect a correction after a series of dynamic increases. What does the indicator say, without which the increases may not last long? Stablecoins in the cryptocurrency world play a similar role to the amount of money in an economy controlled by central banks. Last year, their total market value fell by 14%, and according to StablecoinPrinter's twitter profile, December 2022 was the first month with almost no new tokens in circulation. Currently, their market value is falling month-on-month by more than 2%. It seems that until we see a change in this trend, it would be difficult to see stable growth for the digital currency market. The lack of new funds to purchase cryptocurrencies such as bitcoin, for example, may reduce its chances of long-term growth. However, if the situation changes, we would be able to see this on the stablecoin market capitalisation index. Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Have cryptocurrencies overcome the curse of the FTX collapse? (conotoxia.com)

It's been over a month since we heard about Chat GPT artificial intelligence. Microsoft Corp (Microsoft) would be in talks with OpenAI to invest $10 billion in it, which could allow the San Francisco-based company to be valued at $29 billion. OpenAI owns the Chat GPT language model, and Microsoft plans to use it to enhance its existing applications and services such as the Bing browser, Word, PowerPoint, Outlook and others. The aim is for Chat GPT to automatically generate text in these applications, allowing it to better compete with Google's AI offering. How might this translate into Microsoft stock? Artificial intelligence that everyone has at their fingertips, or what is Chat GPT? When asked what artificial intelligence is, we could receive the following answer: "Chat GPT is a language model developed by OpenAI that is specifically designed to generate text based on user-entered questions and commands. It is an extension of the GPT (Generative Pre-trained Transformer) model, which was originally developed to generate natural-sounding text. The GPT chat is used to generate answers to questions, translate languages, generate questions, among other things. The model uses large text datasets, which allows it to generate natural-sounding text. One of the important features of Chat GPT is its ability to contextualise questions and generate answers that are appropriate to the context. This allows you to interact with the user in a way that is more user-friendly.  It is difficult to assess the possibilities of Chat GPT at the moment. Every now and then, new ideas hit the web about how to use this technology. It is also hard to say whether the creators themselves are aware of all the possible uses of the bot. OpenAI and Microsoft OpenAI and Microsoft announced a strategic partnership back in 2016, with Azure, Microsoft's cloud platform, becoming the preferred tool for services. The integration of OpenAI technology into Microsoft products has also taken place. In 2017. Microsoft made an investment in OpenAI, and in 2018. OpenAI and Microsoft announced a collaboration to bring OpenAI's GPT-2 model to the Azure platform. This partnership also integrates OpenAI technologies into Office and Dynamics 365 services. In 2019, the companies announced the expansion of their partnership with a new initiative called the OpenAI Internet Scale Language Model (ISLM) Program, which aimed to train the largest language model to date using Azure. Under this, Microsoft has invested US$1bn in the company. Microsoft and OpenAI announced the availability of GPT-3 on the Azure platform and integration with various Microsoft products such as Azure Cognitive Services and Power Virtual Agents. The Information has announced that Microsoft Corp is in talks about the possibility of investing $10 billion in OpenAI, valuing the company at $29 billion. The investment is also expected to include other venture firms, but this information has not yet been officially confirmed by the parties involved. The tech giant's shares do not yet appear to have priced in the possible potential of integrating Chat GPT. If Microsoft's search market share were to double, maintaining a similar margin from advertising as Google, revenue could increase by around $35 billion. This would result in a possible revenue increase of more than 17%. If Google's operating margin is maintained at 27%, this could result in an increase in operating profit of around $9.5 billion and a possible increase in profits of almost 4%. Source: Conotoxia MT5, Microsoft, Daily Would Bing displace Google in the most popular browser? Currently, Google's browser from Alphabet (Alphabet) accounts for 84% of this market, according to Statista data. In comparison, the biggest competitor from Microsoft Bing maintains a 9% share. It seems unlikely that Bing would completely replace Google as the dominant search engine, which has remained the leader of its segment for more than a decade. Google has also invested in artificial intelligence and machine learning, which has helped improve the relevance and accuracy of search results. However, Bing remains a major player in the search engine market and has its advantages. It also has partner integrations that allow it to provide additional features such as Bing Images, Videos, Maps and Shopping etc. Bing has been increasing its market share year on year, most recently from 7.2% to 9%, an increase of 1.8 percentage points, by which it has managed to be an alternative to Google, especially when it comes to enterprise search. Many companies use Bing as their default search engine, some use its API for their internal search systems. In summary, although Bing seems unlikely to replace Google as the dominant search engine in the coming years, it could remain an important player in the market, especially in the context of enterprise search. Source: Conotoxia MT5, Alphabet, Daily Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   

Stablecoins are cryptocurrencies that attempt to mirror the price of other assets, such as the US dollar, allowing to hold funds without need to withdraw them from digital wallets. However, stablecoins seem to have become to the cryptocurrency market what money printing has become to the finance market. According to the Btctools website, the total market capitalisation of stablecoins has fallen by 14% year-on-year, the first such decline since their listing began. At the same time, the Federal Reserve (Fed) reduced the amount of M2 money in circulation by a historic 0.7% year-on-year. Does the change in stablecoin market capitalisation affect changes in the overall cryptocurrency market? What are stablecoins really? Stablecoins are a type of cryptocurrency that are designed to have a stable value similar to other real assets. They are often used as a vehicle for transactions in the cryptocurrency market, as their stable value could avoid the risks associated with large price fluctuations. They could also be used as a way of storing capital, as their value does not fluctuate significantly in the short term. By May 2022, stablecoin's capitalisation had risen steadily, reaching a record $181 billion. It was when the listing of TerraUSD, one of the largest stablecoins, collapsed. The price of the major cryptocurrencies immediately plummeted. Bitcoin lost 35% of its value within a week and the stablecoin's capitalisation fell by $23 billion (down more than 12%). Since then, the market value of all stablecoins seems to be continuously declining month-on-month (currently at 2.8% m/m). Source: Conotoxia MT5, BTCUSD, Weekly What does less digital currency mean for the market? According to the Stablecoin Printer's Twitter profile, which tracks the number of new digital currencies generated, virtually no new tokens were issued among the top 4 stablecoins in December 2022. This is the first such month in history. A shrinking base of virtual money in the system could mean the same thing as central bank money printing for the financial system. A lack of new cash to spend could lead to a shortage of something to spend on new investments. This could lead to a weakened market. The first sign of a change in trend could be a month-on-month increase in the value of the stablecoin market. However, it seems hard to count on such a move in the current market conditions. Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

We could already hear the following words from a Microsoft representative at an Activision conference early last year: "This morning, we announced that we will acquire Activision Blizzard in an all-cash transaction valued at $68.7 billion. This will be the largest acquisition in our history, and we’re investing to create a thriving gaming ecosystem, one where world-class content can more easily reach every gamer across every platform”. This process now appears to be in one of its final stages, but has just been blocked by the Federal Trade Commission (FTC) over monopoly allegations. The first pre-trial hearing will take place on 3 January. Will there be a bigger takeover in the tech giant's history? A few words about Activision Blizzard Activision Blizzard (Blizzard) is the world's leading developer of computer and console games. The company was founded in 1979 and is headquartered in Santa Monica, California. The company is known for blockbusters such as the Call of Duty series, World of Warcraft and Crash Bandicoot. It has games for a variety of platforms, including PC, game consoles, mobile devices and personal computers. Activision also has a number of publishers and development studios that produce games under the company's brand. The company makes money from sales of its games and from in-game subscriptions and microtransactions, where players can buy additional content or services with real money. Activision Blizzard is also actively involved in the development of eSports and organises a number of eSports tournaments and leagues in which many professional players participate. The company also earns money from ticket sales to these events and from sponsorship and advertising deals. In addition to game sales and participation in e-sports, Activision Blizzard also generates profits from the licensing of its branded games and characters, which are used in various products such as toys, clothing and accessories. Read next: Twitter Did Not Pay $136,260 Rent, Microsoft Reported Its Worst Quarterly Results In Years| FXMAG.COM Legal problems with the takeover In January 2022, Microsoft announced the acquisition of the games developer for US$68.7bn (US$95 per share). The company appears to be in a position to complete this acquisition, currently holding USD 107 billion. In order for this to happen, the company needed approval from 16 regulators from various countries. Source: Conotoxia MT5, Microsoft, Daily Gaming is an important business segment for Microsoft, as it brought in more than $16 billion in the last year. The acquisition of Activision Blizzard could give the company additional revenue and allow it to hold back the company's games on competing platforms, which could make Xbox a monopoly in the gaming market. For the moment, therefore, the Federal Trade Commission (FTC) has filed a lawsuit to block the acquisition. As the body stated in a release: "Microsoft has already shown that it can and will withhold content from its gaming rivals. Today we seek to stop Microsoft from gaining control over a leading independent game studio and using it to harm competition in multiple dynamic and fast-growing gaming markets." On this call, Microsoft CEO Bobby Kotick wrote in an official letter to the company's employees: "This sounds alarming, so I want to reinforce my confidence that this deal will close. The allegation that this deal is anti-competitive doesn't align with the facts, and we believe we'll win this challenge." It seems we will find out more details after the first pre-trial hearing. The bet Warren Buffett is making At Berkshire Hathaway's (BerkshireHa) annual general meeting in May, legendary investor Warren Buffett announced that he had purchased a share in the games developer. In his own words: "Occasionally I’ll see an arbitrage deal and do it." The billionaire now owns US$4.47 billion worth of shares, representing more than 7 per cent of the company's stock. If the deal had gone through at US$95 per share, buying at the last closing price, we would have had the potential, as much as 24 per cent profit. Source: Conotoxia MT5, Blizzard, Daily Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71.86% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

In October, the reading of the US Home Purchase Contract Signings Index fell 4% month-on-month to 73.9 points, the second lowest reading in the past 20 years. This represents a 37.8% year-on-year decline in the number of homes sold. At the same time, the Case Shiller Home Price Index (CSHPI) increased by 8.6% year-on-year. Average interest rates on 30-year mortgages have doubled since the beginning of the year to 6.3%. Could there be a collapse in this market and would it be a bigger crisis than in 2008? 2008 is still a long way off... The financial crisis of 2008 was one of the biggest financial crises in the history of the current century. It had its origins in late 2007, when problems began to emerge in the US real estate market. Many banks and investment companies invested in financial instruments based on property prices. When property prices began to fall by up to more than 10% year-on-year, these instruments lost value, resulting in losses for many financial institutions. The first victim of the crisis was Lehman Brothers, which declared bankruptcy on 15 September 2008. This caused panic in the financial markets and put many other financial institutions in trouble. In response to the crisis, governments and central banks around the world took action to protect financial institutions and stabilise markets. In many countries, assistance programmes were introduced to help companies and individuals affected by the crisis. The largest cycle of printing and cheap money in US history was also launched. At present, lending rates are at the level of the property crisis. The downward trend in building permits for new homes may also seem worrying, but here the value is nearly 50% higher than in 2008. The situation for the moment seems to be saved by average property prices, which are currently rising by 14.7% year on year. Unfortunately, the pessimistic attitude of consumers and businesses towards the coming months and the drastically declining demand may have led, among other things, to a more than 30% drop in the iShares Mortgage Real Estate ETF (REM) giving exposure to broad real estate companies. Source: Conotoxia MT5, REM, Daily Are we in for a real estate slump? The mortgage debt service payment as a percentage of disposable personal income in the USA currently stands at 3.9% and the total debt in relation to disposable income at 9.7%. These values are among the lowest in 50 years. By comparison, the same parameters in 2008 were 7.1% and 13.1%. This means that it now costs the average US citizen almost twice as much to pay a mortgage installment in relation to their earnings. It should also be taken into account that most home loans are taken out at a fixed interest rate, so that their drastic increase over the past months wouldn’t necessarily lead to a repayment problem. For this reason, an investment in the iShares Residential and Multisector Real Estate ETF (REZ) seems relatively safe. It is a passive fund that invests in real estate companies involved in residential and commercial rental and property management. It has historically performed better than the broad property market. Nevertheless, we may currently see a discount of 30% on it. Source: Conotoxia MT5, REZ, Daily   Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

According to the finviz portal, the industry that has been most overvalued in global markets in 2022 is car manufacturers. Here, the average company discount has been as high as 58% since the beginning of the year. Seth Klarman, one of the top US investors who founded and heads the investment firm Baupost Group, often recommends looking for investment opportunities by looking at the list of the year's biggest losers. With this in mind, let's take a look at the state of the industry and whether we could find potential investment opportunities there? A tough year for the automotive industry All the factors that affect this industry may have worked against it recently. It was not insignificant that automotive companies are characterised by high production costs and relatively low margins. The rise in inflation in the United States to currently 7.1% year-on-year. was reflected by higher costs in companies' operations. Interest rates rising at the fastest rate in 20 years probably also gave automakers no reason to be happy. Limited access to cheap credit may have reduced demand for such goods. However, light at the end of the tunnel may be provided by falling commodity and raw material prices. Inflation is now falling for the fifth consecutive month in the United States, down from 9.1% year-on-year, and in the euro area it now appears to have peaked at 10.6% year-on-year. However, it is important to remember that falling inflation means further rising commodity prices. The only variable is their rate of increase. Overview of the industry by key indicators Klarman, mentioned earlier, draws attention in his strategy to the aspect of 'margin of safety', i.e. how long a company could still survive in a worse period. There could be several factors influencing this aspect, e.g. the stock of liquid assets (e.g. cash) relative to the company's liabilities, the amount of margin (companies with high margins are those that have some sort of competitive advantage, which allows them to offer their products more expensively than the competition) or the amount of debt relative to the company's own assets (the so-called financial leverage level). The latter factor in particular often becomes a reason for the bankruptcy of a company. On a positive note, Niu Technologies (NiuTech) seems to fulfil all of the above. It is a Chinese company that manufactures and sells electric scooters. The company was founded in 2014 and has quickly become one of the market leaders in China. Niu Technologies offers a wide range of products for different segments, including premium products and cheaper options. The company also operates in Europe, Asia and Latin America. The company's cash to liabilities ratio, known as the quick ratio (QR), is a measure of the company's ability to pay its current financial obligations. It currently stands at 1.3 for Niu Technologies. This means that the company is able to repay its financial obligations at any time. The second aspect of the 'margin of safety' is the net profit margin, which currently stands at 0.9%. Although this is down from a level of around 7%, positive margins currently appear to be a rarity for the industry; according to the finviz portal, barely 15% of companies in the industry can currently demonstrate such an achievement. Niu Technologies has a debt-to-equity (leverage) ratio of 0.26, which may further speak of its safe situation. Analysts' average predictions for profit growth are as high as 250% year-on-year. Source: Conotoxia MT5, NiuTech, Daily Another company that appears overvalued is General Motors Company (GM). The US automotive corporation manufactures, sells and services cars, vans, motorbikes and other motor vehicles. The company is one of the largest car manufacturers in the world and has a wide range of brands including: Chevrolet, Buick, GMC, Cadillac, Baojun, Holden, Wuling and Jiefang. The company's Quick Ratio liability coverage ratio currently stands at 1.00, giving it a relatively high level of safety. The net profit margin looks better than for Niu Technologies, at 5.8%, and does not appear to be declining significantly despite the negative macroeconomic environment (the maximum for the past five years has been 9%). The company's debt-to-equity ratio, which stands at 1.19, may be negative, causing net profit to deteriorate if central banks continue to raise interest rates. However, General Motors Company's strength appears to be its huge free cash hoard, which amounts to 36% of the company's market value. Source: Conotoxia MT5, GE, Daily Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

“I think the environment that we are in, as difficult as it is, is an opportunity for us in many ways. I’d rather the economy be booming along but if you are going into a difficult time, this is the time where market leaders have the opportunity to improve their position coming out of a difficult economic cycle. You’ve got a rising interest rate environment. That’s clearly a tailwind for us [given that with higher interest rates we earn higher interest on customer balances held on our platform].” - With these words, Dan Schulman, CEO of PayPal (Paypal), opened the recent conference. What could this mean for the future of this company and is it really an opportunity? A few words about PayPal PayPal is a financial services company best known for one of the world's largest and most popular online payment platforms. PayPal allows users to make payments for purchases in online shops, transfers of money between people and other financial operations. It also offers: credit cards, bank accounts and other financial tools. The company operates in more than 100 countries and serves more than 400 million active users worldwide. The company's business model is mainly based on fees for using the platform to make online payments. Users who meet conditions regarding the number of transactions or the level of turnover are exempt from these. PayPal also earns fees for the use of the credit or debit cards it makes available to its users. The company also gets fees from merchants for allowing them to accept payments through its platform. Overall, PayPal's business model is based on fees for using its services and exchange rate differences. PayPal financial results The company has not had a quarter with a decline in revenue since 2015, while the average annual growth was 16% year-on-year (21% year-on-year. after excluding E-Bay). We learned from the Q3 report that this growth has now dropped to 10% y/y. Similarly, the company's situation is similar for organisational profit, which increased by 7.19% y/y. The net profit margin for the company currently stands at 8.5% and has seen a noticeable decline since the beginning of 2021, when it stood at 22.8%. However, it seems that the company is nevertheless leveraging its advantage over its competitors, where the average net profit margin is 7.45%. However, given the nature of this type of business, let's look at operating cash flow and the amount of funds held. Operating income appears to be strongly seasonal, which may be linked to the customer buying cycle. The company's cash inflow values are highest in recent quarters. Currently, cash flow growth from its core business has increased by 28% year-on-year. The company currently holds more than USD 10 billion in cash and cash equivalents, representing 14% of its market value. What does Wall Street think of PayPal's share price? According to the Market Screener portal, the company has 47 recommendations, and among these, the predominant one reads: "Buy". The average target price is set at USD 105.62, 53% below the last closing price. The highest target price is at USD 160 and the lowest is USD 75, which is below the last closing price. Source: Conotoxia MT5, PayPal, Weekly Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.    

Compared to 2020 and 2021, 2022 seemed to be a more challenging year for investors. Popular indexes like the U.S. Dow Jones Industrial Average through Dec. 23, 2022, have posted annual losses. The DJIA has fallen less than 8 percent since the beginning of the year and has performed better than the S&P 500, which fell -18.8 percent, or the Nasdaq 100, which retreated 32 percent. However, despite the declines, there were companies in the index that shined. They are the ones we will look at. There are 10 companies in the Dow Jones Industrial Average index since the beginning of the year that have positive returns until Dec. 23, 2022. Chevron (+46%), Merck (+45%), and The Travelers Companies (+19%) have gained the most during this time. What are the companies that did so well in this difficult year? Chevron Corporation is a multinational oil and chemical company headquartered in San Ramon, California, USA. Chevron is one of the world's largest producers and distributors of oil and natural gas and a producer of various chemical products. The company has representation and assets in more than 180 countries around the world. Chevron operates in several sectors of the economy, including the extraction, processing and sale of oil and natural gas, the production of chemicals, and the supply of fuel to consumers and industry. Chevron's net income for the quarter that ended September 30, 2022, was $11.231 billion, up 83.78% year-on-year. Chevron's net profit for the twelve months ended September 30, 2022, was $34.167 billion, an increase of 244.95% year-on-year. Source: Conotoxia MT5, Chevron, Weekly Merck is a multinational pharmaceutical company headquartered in Kenilworth, New Jersey, USA. Merck researches, develops, manufactures, and distributes drugs and other health products, such as dietary supplements and medical equipment. The company focuses on the development of innovative medical solutions, with the goal of helping people improve their health and quality of life. Merck also conducts research and development activities and collaborates with public health institutions and organizations around the world. The company has representation and assets in more than 70 countries and is one of the world's largest manufacturers of medicines and health products. Merck's net income for the quarter ended September 30, 2022, was $3.248 billion, down 28.88% year over year, while net income for the twelve months ended September 30, 2022, was $15.260 billion, up 112.06% year over year. Source: Conotoxia MT5, Merck, Weekly The Travelers Companies, Inc. is an international insurance company headquartered in St. Paul, Minnesota, USA. The company provides life insurance, casualty insurance, business insurance, and automobile insurance. Travelers also offer risk management products and services, as well as safety and security consulting. The company has representation and assets in more than 30 countries and is one of the world's largest insurers. Unlike the previous two companies, however, Travelers' financial result is not as impressive. Travelers' net income for the quarter that ended September 30, 2022, was $0.450 billion, down 31.51% year-on-year. Travelers' net income for the twelve months ended September 30, 2022, was $3.331 billion, down 7.86% year-on-year. The market, however, seems to expect that after a decline in profit in 2022 compared to 2021, it will begin to rise again next year, which may have already helped the company's share price. Source: Conotoxia MT5, Travelers, Weekly Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia

The idea that gold could protect capital from inflation has been anchored in investors' minds. However, in 2022. Americans did not protect, as to date the return on gold is almost -1.5 percent. In other currencies the result looks a little better, but this is also not exactly protection against inflation, but more against devaluation of local currencies against the USD. Could 2023 change this? The markets and the media seem to be making increasingly bold predictions for gold prices next year, which could more than make up for the current real losses against inflation. As Juerg Kiener, managing director and chief investment officer of Swiss Asia Capital, told CNBC, gold prices could rise to $4,000 an ounce in 2023, as interest rate hikes and recession fears keep markets volatile. There is a good chance that the gold market would see a big move, he said, adding "it won't be just 10% or 20%," but a move that will take the market to new heights with momentum, Kiener added. Kiener explained that many economies could face "a bit of a recession" in the first quarter, which would lead many central banks to slow the pace of interest rate hikes and could make gold immediately more attractive. He said gold is also the only asset that every central bank owns. Source: Conotoxia MT5, XAUUSD, Weekly According to the World Gold Council, central banks bought 400 tons of gold in the third quarter, nearly doubling the previous record of 241 tons during the same period in 2018. However, at the same time, gold fund units were sold by investors, which as a result may have offset demand from central banks. On the contrary, gold may have flowed by speculators/investors to central banks. In 2023, it would be investors who would have to return to this market to help lift gold prices toward new highs. According to the Statista website, the average annual return on the gold market between 1971 and 2019 was about 10 percent. This means that 2022 has deviated from the average, but will it be able to return to it in 2023? Perhaps we will find out in the first quarter, when we learn the Fed's latest decision on interest rates and the further pace of any increases. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

After a week full of interest rate rises, it seems that markets may finally be catching their breath, or at least most of them. The exception may be Japan, where the central bank there has announced a turnaround in financial policy. Macroeconomic data Monday saw the publication of several important macroeconomic data, including the German Ifo Business Climate Index for December, the RBA meeting minutes, the PBoC Loan Prime Rate and a statement and the Bank of Japan. The German Ifo Business Climate Index is an important index that measures business sentiment in Germany. The reading for December was 88.6 points, which was better than expected (87.4 points) and may signal an improvement in business sentiment in Germany. The previous reading for November was 86.4 points. The result may indicate that the German economy is in better shape than expected and could be a positive signal for other economies in Europe. The minutes of the RBA (Reserve Bank of Australia) meeting did not bring any surprises and contained no significant changes to the central bank's monetary policy, which is expected to continue to raise interest rates. The PBoC (People's Bank of China) interest rate remained at 3.65%, which was expected by the market. The Bank of Japan (BoJ) released its monetary policy statement and held a post-meeting press conference. The first steps were taken to tighten monetary policy, announcing a rate hike and increasing the level of government bond purchases. Because of this, the Nikkei index (JP225) may have fallen by more than 3% since the start of the week. Source: Conotoxia MT5, JP225, Daily On Tuesday, we learnt about the number of new building permits in the US, the reading for November was 1.342 million, worse than expected (1.485 million) and a decrease in permits compared to the previous month (1.512 million). The reading may indicate that the construction sector in the US is less active than expected, which could have a negative impact on the economy, potentially contributing to higher unemployment in the sector in the future. Wednesday brought the publication of more data. We learned about Canada's core inflation reading (excluding food and energy prices). The reading for November was 0.0% m/m, while 0.2% m/m was expected. This represents no change in the price level compared to the previous month (0.4% m/m.). On the same day, we learned the reading of the Consumer Confidence index, which measures consumer sentiment in the US. The reading for December was 108.3 points, which is better than expected (101.0 points) and represents an improvement in consumer sentiment compared to the previous month (101.4 points). This good result could be attributed to the pre-Christmas period. The last of the important publications concerned US crude oil inventories. The reading for last week was -5.894 million barrels (previously 10.231 million b.). Which could suggest a return to a further shortage of this crude. On Thursday, we learned of signs of a slowdown in the UK economy. The GDP reading for the third quarter of this year was 1.9% y/y. (2.4% y/y was expected). This is down from the previous reading of 4.4% y/y. Due to the holidays starting on Friday's session, some stock exchanges will close earlier than usual, which should be taken into account in investment intentions. The stock market Declines in most sectors in the US are unlikely to represent optimism about the 'Father Christmas rally' starting. We could see the largest in the new technology sector. TheTechnology Select Sector SPDR Fund (XLK), which tracks the sector's quotations, fell by 4.8%. Only the energy sector rose. This seems to have had something to do with rising energy commodity prices this week. Source: Conotoxia MT5, XLK, Daily This week gave us the last of this year's Q3 figures. Tuesday brought the release of financial results from Nike (Nike), the global footwear and apparel giant, among others. The company reported Q3 EPS of $0.85, better than expected ($0.65). Next is General Mills (GnrlMils), the food manufacturer reported EPS of 1.1, a reading that came as a positive surprise to analysts (1.06 was expected). Next is FactSet Research (FactSet), a data and analytics solutions company, reported Q3 earnings of 3.99 per share, 3.62 was expected. On Wednesday, we learned the results of Micron (Micron), a computer memory manufacturer, which reported an EPS loss of 0.04 in Q3 (-0.01 expected). On the same day, Cintas (Cintas), an apparel services company, reported Q3 earnings per share of 3.12, expected (3.03). Carnival Corp (Carnival-US), the cruise company, reported a loss of $0.85 per share in Q3, better than expected (-$0.88). Currency and cryptocurrency market After a week of decisions by as many as 11 central banks, we saw numerous interest rate rises. These seem to have changed some global currency market trends. The EUR/GBP pair saw the biggest increase, up 1%, but we saw the biggest changes in pairs linked to the Japanese yen. The USD/JPY exchange rate has fallen by more than 3% over the course of this week and now stands at around 132. This is a drop of more than 13% from its peak, and appears to have been triggered by Monday's announcement of a change in monetary policy by the central bank of Japan. Source: Conotoxia MT5, USDJPY, Daily The cryptocurrency market has stagnated. The price of bitcoin (BTCUSD) was virtually unchanged over the course of this week, rising by just 0.3%. One of the strongest gaining cryptocurrencies was ethereum (ETHUSD), which increased in value by 2%. The digital currency market appears to continue to remain in its sideways course, showing no signs of changing. It's time for Christmas to begin! As we begin the festive period, we will not know any more key data until the end of the year, and the markets have to accept that this year would probably do without the usual 'Father Christmas rally' during this period. Nevertheless, we would like this period to be the best it can be for all of us. The Conotoxia team sends its regards. Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The price of silver, expressed in U.S. dollars, has risen by almost 23 percent in the last three months. Thus, of the popular markets among investors, such as stock indexes, oil, and other metals, it boasts the potentially highest rate of return to this point. As recently as September, less than $18 was being paid for an ounce of the metal, to value it at nearly $23 by the end of December. What has changed in that time that could have led to such a rapid rise in the price of a popular alternative among investors to gold? According to data that mints publish, there are shortages of the raw material for coin production in the United States, so there may be shortages in other parts of the economy and industry as well. However, this is not due to above-average demand at this time. Demand has been above-average twice recently, which happened in the pandemic and during the outbreak of war in Ukraine. Now, however, it seems to be more stable, and the problems may lie more on the supply side. Unlike gold, which is easily renewable and melted down for new jewelry, for example, and rarely fails to undergo some form of recycling, the same could not be said for silver. It is estimated that about 60% of silver is used in industrial applications, leaving only 40% for investment. Of that 60% used in industrial applications, almost 80% ends up in landfills. This means that with mining problems and lack of recovery of the raw material, supply problems may continue. Hence, there could be a situation where demand exceeds supply, which could have a positive impact on the price. Source: Conotoxia MT5, XAGUSD, Weekly For example, there are shortages of disks in the US mints, which are used to mint the popular Silver American Eagle coin. Its price is about $36. So an ounce of physical silver costs about $36, while an ounce in contract costs about $23. This creates a divergence not seen for at least a decade. From this point of view, the divergence may be reduced over time. If silver supply does not increase, it is possible that the price of silver in contracts could rise toward the valuation of physical silver. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

OPEC (Organisation of the Petroleum Exporting Countries) brings together oil producing and exporting countries. Every month, it also issues a report with detailed information on the oil market and forecasts of production and demand for crude. Clues could be extracted from these, such as the rate of economic development of individual countries or regions. Black gold production In the third quarter of this year, total crude production was 100.46 million barrels per day, up 5.4% year-on-year. The US was the largest single producer of this crude, providing 19.21% of the total world supply. It is worth noting that production in the US, which is not an OPEC member, increased by more than 8% from the previous year. OPEC cartel countries (including Saudi Arabia, the UAE and Kuwait) supplied 29.3% of world supply. Although they reported production cuts, their daily output increased by 11.75% year-on-year, translating into the largest increase among the world's producers. Crude oil prices on world markets appear to have fallen recently. They have already fallen by more than 30% since their March peaks. This seems to have been heavily influenced by the increase in oil production. Many experts suggest that more available oil on the market may lead to a fall in the price of oil. Source: Conotoxia MT5, XTIUSD, Daily The prediction for the coming months is that oil production growth would continue at a fairly high level. In the current quarter, it is expected to average 1.7% over the previous quarter. Estimates for next year assume an average increase in production of 1.5% over the previous year. Whether this could actually happen would become clear in a few months. There will be no crisis, please disperse Oil consumption usually reflects well the level of economic development of a country. Data provided by the cartel indicate that an economic slowdown may occur in the first quarter of 2023 in China and Russia. Forecasts for the following quarters are more favourable compared to the current year. Average oil demand growth in 2023 could be 2.2% over the previous year (currently at 2.6%). For this reason, we can expect declines in the listings of a Chinese equity fund such as the iShares MSCI China ETF (MCHI), which may not count this year as one of its best. Source: Conotoxia MT5, MCHI, Weekly According to market projections and the number of orders contracted, India's economy could grow the fastest, at an average rate of 4.95% year-on-year. Therefore, the listing of the iShares MSCI India ETF (INDA), which mirrors India's main index, could prove to be a long-term investment opportunity. It seems worth considering such an investment. Source: Conotoxia MT5, INDA, Weekly   Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia

The Bank of Japan's decision, described yesterday, to raise the range for interest rate fluctuations on Japanese 10-year bonds to 0.5 percent may still have its consequences for financial markets. These may no longer just be looking at a change in the control of the yield curve, but may increasingly assume a change in interest rates. Since the beginning of 2016. The Bank of Japan has held its main interest rate at -0.1 percent and holds the world record for this. Nowhere else, in any other country, are interest rates as low as in Japan. Even the Swiss have abandoned this and raised their main interest rate to 1 percent, while the Japanese, for the moment, have allowed a larger bond sell-off and an increase in the yield on their debt, under what is possible to be an onslaught of global interest rate increases. At present, however, the market seems to expect that this is only the beginning of the BoJ's actions. The next step the Bank of Japan may take is to change the interest rate itself. Investors in this market seem to expect it to rise to 0.3 percent in a year. Adding to this the expectation of a slow end to interest rate hikes in the U.S., it could turn out that in 2023 Japan would lead expectations for interest rate hikes. This could significantly affect the yen or the Japanese stock market. Yen exchange rate and Nikkei The Japanese yen oscillated around the 132-per-dollar level on Wednesday, after rising nearly 4% during the previous session to reach levels not seen in more than four months. Overall, after the second intervention in the foreign exchange market, which took place in October, the USD/JPY exchange rate fell by 14 percent. This was a retreat from levels last seen in 1990. Going back to that history, and especially to 1998, where the Bank of Japan also intervened in the market at JPY 147-148, the USD/JPY exchange rate fell to JPY 102 the following year. If the Fed ended the hike cycle in the first half of 2023, such a scenario could be repeated. Source: Conotoxia MT5, USDJPY, Weekly The Nikkei 225 index fell 0.68% to close at 26388, while the Topix index lost 0.64% and fell to 1893 on Wednesday, extending the sharp decline triggered by the Bank of Japan's surprise policy change. Technology stocks led the market lower. Meanwhile, Japanese banks extended gains in anticipation of better returns from rising interest rates, including Mitsubishi UFJ (3.9%). Sumitomo Mitsui (4.1%) and Mizuho Financial (2.2%). Source: Conotoxia MT5, Mitsubishi UFJ, Weekly Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

"Avatar", which premiered in 2009, earned $2.74 billion worldwide, becoming the highest-grossing film in history. It seemed that the latest instalment of this film, 'Avatar: The Way of Water', which is over three hours long, would be similarly or even more successful. The studio predicted that the film would earn between US$ 135 million and US$ 150 million on its opening weekend. In the meantime, it stood at around USD 100 million. Disney (Disney) shares have fallen by more than 4.5% since the beginning of the week. Is this a buying opportunity? History of the Walt Disney Company Disney is one of the world's most famous and respected entertainment companies, founded in 1923 by brothers Walt and Roy Disney. The company began as a small film studio, but quickly grew to produce animated films, television series and children's programmes. In 1955, Disney opened its first theme parks, Disneyland in California, and a few years later, in 1971, it opened Walt Disney World in Florida. Today, Disney owns several theme parks around the world, as well as many other companies in the entertainment industry, such as film studios, television and radio stations, and companies that produce toys and other children's products, valued for their quality and for inspiring and cheering up people around the world. In November 2019, the company launched the 'Disney+' streaming platform, which provides access to a variety of film and TV content. It includes films, series, TV shows and animation from a number of well-known brands such as Disney, Marvel, Star Wars, National Geographic and Pixar. It appears that the company has now set its sights on significant growth on this platform. The service has more than 164.2 million subscribers compared to Netflix's (Netflix) 223 million subscriptions, which now seems to be the company's biggest competitor. Source: Conotoxia MT5, Netflix, Weekly Financial situation The company's revenue grew by 23% year-on-year. The number of new subscribers on the 'Disney+' platform grew by more than 39% year-on-year, compared to Netflix, for which this growth was 4.2% year-on-year. According to the company's CEO Bob Chapek: "2022 was a strong year for Disney. We saw sizable subscription growth in the fourth quarter, adding 14.6 million total subscriptions, including 12.1 million Disney+ subscribers. Disney+ in just three years since launch is a direct result of our strategic decision to invest heavily in creating incredible content and rolling out the service internationally, and we expect our DTC (direct-to-consumer) operating losses to narrow going forward and that Disney+could still achieve profitability in fiscal 2024, assuming we do not see a meaningful shift in the economic climate." It appears that Disney could not return to previous levels of profitability since the launch of the service. Currently, the company's net margin ratio is 3.8% (it was 22% in 2019) compared to Netflix's 16%. One could conclude that the company is currently focused on growing the platform even at the expense of profitability. However, it is hard to predict when this trend would change and what results we could expect. What does Wall Street think of Walt Disney's share price? According to the Market Screener portal, the company has 30 recommendations, and among them, the predominant one reads: "Buy". The average target price is set at USD 124.05, 44% below the last closing price. The highest target price is at USD 177 and the lowest is USD 94, which is below the last closing price. Source: Conotoxia MT5, Disney, Weekly Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Bernard Arnault, founder and patriarch of family holding company Groupe Familial Arnault, overtook electric car and rocket manufacturer Elon Musk last week. He wrapped up the number one spot in two of the most popular lists of the world's richest people. According to Bloomberg, the billionaire currently has a fortune of USD 163 billion. The question may arise, however, how does luxury goods tycoon becomes the richest man despite global fears of a recession? The story of Bernard Arnault Bernard Arnault was born in 1949 in Paris. His father was an engineer and owner of a construction company and his mother was a pianist. Arnault graduated in law and economics before embarking on a career in business, working for his father's company. In 1984, Arnault took control of Christian Dior (Dior), which was then in financial difficulty. Under his leadership, the company restructured and became hugely successful, becoming one of the most important fashion houses in the world. Arnault continues to serve as CEO of Christian Dior. In addition to this, he is also the founder and CEO of LVMH, the world's largest luxury goods corporation, which includes many brands in various segments, including fashion, jewellery, perfume, spirits, watches, electronics and other luxury products. Arnault is also involved in many philanthropic initiatives and is known for his commitment to art and culture. The value of the billionaire's fortune has doubled in the past two years. Arnault's fortune currently consists of 79% of the shares of fashion house Christian Dior (Dior), 15% of luxury goods company Louis Vuitton Moet Hennessy (LVMH), owning brands such as Louis Vuitton, Lou Fendi, Givenchy, Kenzo, Loewe, Marc Jacobs, Celine, Berluti, Emilio Pucci, Thomas Pink, Loro Pian, among others. The remainder of the wealth is made up of smaller private investments and as much as US$10 billion in cash and cash equivalents. Source: Conotoxia MT5, Dior, Daily Elon Musk's dethronement Elon Musk's fortune has declined by more than 40% since the beginning of the year and now stands at US$155 billion. To a large extent, this appears to be linked to declines in the share price of Tesla (Tesla), which accounts for 34% of the billionaire's portfolio. The valuation of the carmaker's assets has fallen by 57% since the beginning of the year, and the company does not seem to be helped by further reports of more Tesla shares being sold. Source: Conotoxia MT5, Tesla, Weekly Why is the luxury goods industry doing so well in the downturn? Louis Vuitton Moet Hennessy's (LVMH) year-to-date revenue increased by 28% year-on-year. What may seem interesting is that the company recorded the highest revenue growth in Europe (up 43%). The company attributes much of this growth to organic growth. It might seem, however, that Europe, hit by the energy crisis and the economic slowdown, would be the first to cut back on spending on luxury goods. However, we could be dealing with what is called the 'snob' effect in economics, which is the phenomenon of buying goods according to social status level. This could explain why, when most people are struggling to cope with rising costs caused by inflation on basic products, the wealthiest people do not seem to feel it as much. Read next: The FCC Seeks More Than $200 Million From Four Cellphone Carriers| FXMAG.COM Source: Conotoxia MT5, LVMH, Weekly   Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia

The Bank of Japan appears to be joining the ranks of the world's other central banks in deciding to take the first step toward tightening monetary policy. While it has not raised its official interest rate, it has increased the range for Japan's bond yields, which may make its interest rates a bit more attractive. Since September 2016. The Bank of Japan has kept a check on bond yields, at the time setting a target for the 10-year bond yield at 0% with a maximum deviation of 10 bps. This was meant to stimulate inflation along with other programs and provide cheap financing. The BoJ then expanded the expected fluctuation range, and when sellers of Japanese paper became too numerous and yields rose above the range, it triggered unlimited buying of those bonds. In July 2018, the fluctuation band was extended to 20 bps, and in March 2021 to 25 bps from the 0% level. Today, the range was widened to 50 bp, pushing yields towards it, to their highest level since 2015. With today's decision, the Bank of Japan (BoJ) kept its key short-term interest rate at -0.1% and the 10-year bond yield near 0%, as expected. At the same time, the central bank changed the yield curve's tolerance range in an effort to reduce some of the costs of prolonged monetary stimulation (the Bank had to launch unlimited bond purchases). The council said it would widen the 10-year government bond yield spread from the current +/-0.25 points to +/- 0.5 points. Meanwhile, the BoJ assessed that the economy was possibly to recover, with the impact of COVID and supply issues waning, while downward pressure continued due to high commodity prices and a slowdown in foreign economies, tradingeconomics reported. The annualized inflation rate is possible to rise in 2022 due to increases in the cost of food, energy and durable goods, before weakening in the middle of fiscal 2023. The council reiterated that it will take additional easing measures if necessary, and expects short- and long-term rates to remain at current or lower levels. Significant impact on the yen exchange rate Although interest rates were not changed, Japanese bond yields moved up, reducing their divergence from bonds of the US, Germany or other countries where a rate hike cycle is underway. As a result of this, the Japanese yen was able to gain decisively, falling from the JPY137 area to JPY133 this morning. Japan was thus able to take another step to support the yen, following its previous second successful currency intervention. Source: Conotoxia MT5, USDJPY, Daily Perhaps after a strong dollar, the time would come for a strong yen as well, and changing the target for bond yields may be just the first step. Further possible action, may be an interest rate hike, where the market expects an increase to 0.3 percent in 2023. This would mean a 40bp increase, which, assuming US rates can start falling or stop rising at the same time, could give the yen a boost after a disastrous 2022. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money

The year 2022 could bring some of the biggest interest rate rises in history. As the reference rate rises, interest rates on loans and credit cards rise evenly. It seems that the banks providing these loans should be the biggest beneficiaries of this situation. Is this the moment to invest in this sector? The situation of borrowers in the United States Currently, the volume of all consumer loans in the United States has increased by 17% y-o-y. and has climbed to historic peaks, amounting to as much as USD 934 billion. According to Lendingtree, the number of people with a personal loan increased from 19.9 million in 2021 to 20.4 million in 2022. Personal loans accounted for 2.8% of the total debt of US citizens. The country's economic problems may be translating into interest in this form of debt. The average balance of a new personal loan was US$6,656 in the first quarter of 2022, compared to US$5,155 a year ago. According to Lendingtreel, almost 6 in 10 borrowers (57.6%) opted for a personal loan to consolidate debt or refinance credit cards. The next most common reason was home renovation (5.8%). Currently, the average interest rate on credit cards is 16.27%, the highest in more than 20 years. This compares with an interest rate of 13.59% before the financial crisis in 2008. However, the situation for borrowers currently appears favourable. The percentage of personal loans in default (over 60 days) stands at 2.08 and is one of the lowest in over 30 years. During the crisis in 2008, this percentage even reached 6.77%. It could be concluded that despite the rising cost of debt, it seems that there is no threat of insolvency for the banking sector for the time being. How did the banking sector behave during the rate hike cycle? There have been four cycles of interest rate rises in the past 25 years. These began in the years: 1999, 2004, 2015, 2022 (the current one). During them, interest rates were raised by successively: 1.75 percentage points (in 12 months), 4.25 percentage points (in 25 months), 2.25 percentage points (in 36 months) and 4.5 percentage points (currently in 9 months). Source: Conotoxia MT5, US500, Daily During these rate rises, the Financial Select Sector SPDR Fund (XLF), which mimics the behaviour of the US banking sector, achieved the following cumulative returns (including dividends): 28.4%, 38.33%, 57.5%, -8% (current). During this time, the cumulative performance of recent rate hike cycles has outperformed the S&P 500 Index (US500). However, it should be noted that the banking sector is largely a dividend sector and the performance of the sector excluding dividends would be worse than the market average. Read next: Traders assume interest rates in Japan and Switzerland could steadily go up next year| FXMAG.COM During periods of falling interest rates, the fund achieved the following returns: -7.72% (2000), -60.24% (2007), -29.17% (2020), compared to the S&P 500 Index, for which the rates were respectively: -24.11%, -40.02%, -14.1%. This shows that the sector appears to be performing particularly poorly during periods of interest rate easing. Source: Conotoxia MT5, XLF, Daily Looking at the data presented by the FedWatch tool, which collects analyses of future interest rate forecasts, we could possibly see the peak of interest rate rises in March 2023, and may  expect the first reductions in September next year.   Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Is it time to buy in the financial sector? Analysis of the indebtedness of US citizens (conotoxia.com)

The U.S. Federal Reserve, the Bank of England, the Bank of Australia and New Zealand, as well as the European Central Bank and the Bank of Canada, are among others the central banks of the world's major economies that have already begun the cycle of interest rate hikes and are possibly to be close to completing it in the first or second quarter of 2023. In contrast, the situation seems to be different for the Bank of Japan and the Bank of Switzerland. We could see quite well how monetary policy could affect currency rates in 2022. The Fed, by starting aggressive monetary tightening, was able to make the U.S. dollar more attractive thanks to the higher interest rates its holders received. The Fed started the cycle, and the European Central Bank followed suit with some time lag. For the moment, this lag is estimated to be about six months. This could mean that the ECB will not complete its monetary tightening until two quarters later, after the Fed has done so. The effects of this shift could be observed in the EUR/USD exchange rate. Source: Conotoxia MT5, EURUSD, H4 The unprecedented pace of rate hikes in the U.S. may have helped the dollar until September, October, when discussions began about slowing the pace of USD interest rate increases. At that time, there was also discussion of what direction the European Central Bank should take, which for the moment is declaring hikes of 50 bps each and higher rates than the market had previously expected (>3%). What about the CHF and JPY? The above description may approximate the events in central banking in relation to the exchange rate where, if one theme ends (the near end of rate hikes in the US), the game begins for the next one (the later and higher end of the cycle in the Eurozone). According to data from the interest rate market, traders seem to assume that interest rates in Japan and Switzerland could go steadily upward in 2023. This, in turn, could mean that once the U.S. theme, then the eurozone, is over, the markets could move into the tightening game in countries with previously lowest interest rates in the world. Change in rhetoric in Japan, how does the yen exchange rate react? This morning, the Japanese yen strengthened 0.6% to 135.8 per USD after reports that Prime Minister Fumio Kishida plans to revise a 10-year agreement with the Bank of Japan, which says the central bank will reach a 2% inflation target "at the earliest possible time." The government is seeking to make the price target more flexible, which could broaden the BOJ's policy options for adjusting to economic developments. BNP Paribas Japan's chief credit strategist Mana Nakazora, a potential candidate for deputy governor of the Bank of Japan next year, also told Reuters recently that the central bank should revise its statement to give itself more room to adjust interest rates, according to tradingeconomics. The bottom line is that interest rate hike cycles seem to be staggered in different economies around the world. As a result, currency rates may also react accordingly with some time lag. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Japanese yen and Swiss franc - currencies of 2023? (conotoxia.com)

Hawks are defined as those members of committees deciding on interest rates who are in favor of raising those rates. So there was a rally of hawks this week, as both the Fed and the ECB and the Bank of England and the Bank of Switzerland, among others, decided to raise the price of money and, moreover, are unlikely to change that for the time being. The king, or rather queen of the hawks, became the president of the European Central Bank, Christine Lagarde, and her statement supported the euro exchange rate. The European Central Bank yesterday raised interest rates by 50 basis points as expected, reiterated that there would be further increases and outlined plans for quantitative tightening. The common currency initially strengthened after the decision and reached a six-month high of $1.07. In the afternoon, however, it gave back some of the earlier gains, with market participants trying to assess how much additional rate hikes would hurt the already fragile economy. The ECB raised its inflation forecasts, while economic growth forecasts were sharply lowered. According to the latest forecasts by ECB economists, inflation is expected to reach 8.4 percent in 2022, only to fall to 6.3 and 3.4 percent in the next two years, respectively. Meanwhile, GDP is expected to grow by 3.4 percent in 2022, only to fall to 0.5 percent in 2023 and rise to 1.9 percent in 2024. However, that was not what seemed to be the most important statement. It was probably that the ECB needs to raise rates more than the market is currently pricing in. Christine Lagarde assumes that rates in the Eurozone can be raised at 50 bps for a longer period of time. Thus, the market has begun to expect the peak in eurozone rates to fall above 3 percent. Source: Conotoxia MT5, EURUSD, H1 As a result, the euro was above $1.07 at one point, and what's more, the eurozone may be coming out on top in terms of the pace of rate hikes in the future. Nevertheless, high interest rates and a weaker outlook for economic growth may leave their mark on other markets like the stock market. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Yesterday, financial markets seemed to rejoice at the fact that inflation in November in the US was less than expected. Although CPI is still above 7 percent, and was previously a level rather favorable for falling stock prices, the opposite is now true. Why? It seems to be because of, for the time being, a permanent reversal of price growth dynamics. Following the release of yesterday's data, the dollar index seems to have weakened this morning after falling to around 104 points. Today, investors seem to be awaiting the Federal Reserve's decision on interest rates. The market expects the Fed to scale back its aggressive monetary tightening campaign, but may point to a higher peak for rates in the future, i.e. the hikes may be smaller (interest rate volatility may decrease), but they may last longer and end up not at 4.75-5 percent, but at least at 5-5.25 percent. As a result, uncertainty may have already set in on Wall Street, where after yesterday's first strong upward reaction, the indexes then turned back. After the euphoria, the market may have moved on to a cool calculation that while the pace of hikes may be slower, in the end it is probably better to have a lower interest rate than a higher one. It indicates the level of the investment risk-free rate, and the higher it is, the lower stock valuations could be. Source: Conotoxia MT5, US500, Daily Conference and projections in focus Today, traders will be closely watching Fed Chairman Jerome Powell's press conference after the decision announcement for clues on future rate hikes. The Fed's latest macroeconomic projections may also provide additional information. Going back to yesterday's data, the annual U.S. inflation rate slowed to 7.1% in November 2022, down from 7.7% in October and below market expectations of 7.3%. Other central banks on target Later in the week, we will learn the decisions of equally important central banks. Investors thus may remain cautious in their actions, as the European Central Bank, the Bank of England and the Swiss National Bank would take the stage, with monetary policy decisions to be made as early as Thursday. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.     search   g_translate    

The drastic reduction in crude oil quotations on world stock exchanges has not gone hand in hand with a fall in fuel prices at filling stations in Poland. According to data from the Autocentrum portal, the average price of petrol 95 reached its peak in June this year, amounting to PLN 7.84 per litre (6,78 USD/gallon), and has fallen by 17.6% to date (currently the average is PLN 6.46 per litre around 5,58 USD/gallon). At the same time, the average pump price in the US peaked at US$ 4.84 per gallon (approx. PLN 4.12/l) and has now fallen by 32% to US$ 3.26 per gallon (approx. PLN 2.84/l). In the US, station prices seem to follow oil market trends, which  could not be said for Poland, where prices have remained at similar levels since August. Source: Conotoxia MT5, XTIUSD What can Exxon do that Orlen can't? Despite falling oil prices, the margin (percentage of net profit on revenue) on every litre sold of one of the largest US oil companies, Exxon Mobile, rose from 15.4% to 17.5% in Q3 this year. At the same time, Orlen's margin rose from 7.45% to 10.7%. As it turns out, it may not have been caused by the company's improved service delivery. The increase in profitability with falling station prices (at least those in the US) may have been due to increased refinery capacity utilisation and increased revenues in Q3 of this year. As we can learn from a comment by US CEO Darren Woods: "Rigorous cost control and growth of higher-margin petroleum and chemical products also contributed to earnings and cash flow growth in the quarter." The US company's production costs fell by 6% quarter-on-quarter. Over the same period, these costs for Orlen increased by as much as 34%. Source: Conotoxia MT5, ExxonMobil, Daily In the case of Orlen, the quarterly result could have been significantly influenced by a hedging position on foreign exchange contracts (hedging), which generated a PLN 3.5 billion profit for the company in the event of a weakening of the Polish currency. The increase in Orlen's revenue may also have been largely due to the acquisition of Lotos Group and the inclusion of its result in the company's results, which generated an additional PLN 2.3 billion in revenue. Perhaps a different route for CEO Obajtek (Orlen)? It seems that instead of imposing ever-higher margins and charges on Polish motorists, it is possible, following the example of Exxon Mobile, to focus on cutting costs and increasing production instead of monopolising the Polish fuel market and graciously bailing out Poles with VITAY cards. Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

As we are already approaching the end of the year, we see the Central Banks' latest interest rate decisions for the year. The continuation of the interest rate hike cycle seems to have given cause for pessimism in the markets. The S&P 500 Index (US500) has fallen by 1.9% since the start of the week. However, we could still see optimism in the Chinese markets following reports of a reduction in the zero-Covid policy restrictions. Macroeconomic data On Monday, we learned the results of the US and UK service sector PMIs. The reading for the US was 56.5 points (53.3 expected) and for the UK 48.8 points (48.8 expected). We seem to be able to see a stagnation among business expectations, as the values do not seem to have changed over the last three months. On the same day, we learned of the Central Bank of Australia's decision to raise interest rates to 3.1% (previously 2.85%), which was in line with analysts' consensus. On Tuesday, we learned about GDP growth in Australia, which came in at 0.6% q/q (0.7% q/q was expected). We also learned about the decision of the Central Bank of India, which decided to raise the benchmark rate as expected to 6.25% (previously 5.9%). Particularly important for the energy and commodity markets on the day was the report from the US Energy Information Administration (EIA), which gave its forecasts for future energy prices. It predicts that the price of WTI crude oil (XTIUSD) could stabilize next year and be in the range of US$92.36/b. Source: Conotoxia MT5, XTIUSD, Daily On Wednesday, we learnt of the Central Bank of Canada's decision, which, like its aforementioned predecessors, raised interest rates to 4.25% (previously 3.75%). Japan's quarterly GDP reading appears to have shown signs of a slowdown for the cherry blossom country. Japan's GDP fell by 0.2% q/q. (a decline of 0.3% q/q was expected) against a previous increase of 1.1%. On the same day, we learnt the weekly reading of crude oil inventories, which fell for the 4th week in a row. The current decline was larger than analysts' expectations at 5.2 million barrels (a decline of 3.3 million barrels was expected). It appears that this may have supported the fall in the price of the commodity.  On Thursday, we learnt the number of new claims for unemployment benefits in the United States, which came in line with expectations at 230,000 (previously 226,000 claims). The stock market This week did not seem positive for the stock market. The main US S&P 500 index has fallen by 1.9% since the start of the week. The most declining company on the index was US electricity and natural gas generation and distribution company NRG Energy (NRGEnergy), whose share price fell by more than 20%. The FAANG technology companies performed particularly poorly this week. Google (Alphabet) shares fell by 7.2%, Apple (Apple) fell by 3.8% and Amazon's valuation fell by 5.3%. Large declines were seen in the energy sector. The value of the Energy Select Sector SPDR Fund (XLE) fell by more than 7%. This appears to be due, among other things, to declines in oil prices. Source: Conotoxia MT5, NRGEnergy, Daily On Tuesday, we learned the third quarter results of, among others, car and truck parts and accessories company AutoZone (AutoZone). Earnings per share EPS surprised analysts positively at 27.45 (25.26 was expected). On Wednesday, liquor producer Brown-Forman Corporation (BrownForman), which has a broad portfolio of brands including Jack Daniel's, Woodford Reserve, Old Forester, Canadian Mist and Finlandia, reported quarterly results. Its EPS was worse than expected at 0.47 (0.55 was expected). On Thursday, we learnt the results of the company that designs and manufactures integrated circuits and other electronic components, Broadcom (Broadcom), which reported EPS of 10.45 (10.28 was expected). On the same day, the results of shop chain Costco (Costco) came in below expectations, showing earnings per share of 3.07 (3.12 expected). Currency and cryptocurrency market The foreign exchange market saw the following rate changes over the past week. We could see the biggest increases in the EUR/JPY (up 1.4%) and USD/CAD (1.1%), while the other popular pairs saw little or no change. We seem to be able to deduce from this a weakening of the Japanese yen after the falling GDP data and a weakening of the Canadian dollar after the interest rate decision. The currency market seems to have been fairly stable this week. Source: Conotoxia MT5, EURJPY, Daily The cryptocurrency market seems to be able to feel the thaw. The price of bitcoin (BTCUSD) has risen by 1.4% since the beginning of the week, and the price of ethereum (ETHUSD) has risen by more than 2%. The most rising cryptocurrency was Axie Infinity (AXSUSD), which has risen by 17.2% since the beginning of the week. It seems that the saying "buy when the blood pours" is starting to find confirmation in this market. However, we would have to wait a little longer to be able to say that definitively. Source: Conotoxia MT5, BTCUSD, Daily What can we expect next week? Next week's key macroeconomic data will start with Monday's UK quarterly GDP reading after the recent 0.2% quarter-on-quarter decline. On Tuesday, we will learn Germany's CPI inflation reading. Analysts are expecting no change. The previous reading was 10% y/y. On the same day, inflation in the United States (previously 7.7% y/y) will also be known. On Wednesday, the Fed's US interest rate decision seems particularly important, immediately followed by a conference call by chairman Jerome Powell. In addition, an inflation reading will be given on that day by the UK, for which analysts expect inflation to fall to 10.9% y/y. (previously 11.1% y/y). Wednesday seems particularly important for the currency market and borrowers. Interest rate decisions will be given by the central banks of Switzerland, the UK and the European Central Bank. The week will close with the Eurozone CPI inflation reading. In the stock market on Monday, we will learn the Q3 results of this year's company Oracle (Oracle), on which we wrote a commentary. On Wednesday, we will see the report of the company that builds and sells single-family homes and manages residential properties in the US Lennar (Lennar). On Thursday, we will see the results of the company selling software for artists and businesses Adobe (Adobe).   Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

The price of crude oil on world markets may be on its way to a 10 percent drop this week. Since the beginning of the year, contract prices for a barrel of WTI appear to have dropped 4 percent to around $72. WTI crude oil futures stabilized around $72 a barrel on Friday, falling in recent days as renewed recession fears may have worried financial markets, overshadowing optimism over China's loosening of Covid restrictions and lingering demand concerns, tradingeconomics reported. The U.S. oil benchmark may have been under pressure all week, possibly due to economic concerns, with top U.S. company executives in the U.S. "sounding the alarm" on a potential recession next year. This was also the view expressed by the Fitch rating agency this week. Tightening financial conditions may also have taken a toll on the markets, as it is expected that the U.S. Federal Reserve may continue to raise interest rates and keep them higher for longer. Meanwhile, investors seemed to welcome the easing of Covid restrictions in China for a while, raising hopes of a broader economic opening that could boost demand in the world's largest oil importer. Source: Conotoxia MT5, XTIUSD, Weekly China to change oil supply direction? Chinese President Xi Jinping said Thursday that Beijing is ready to increase oil trade with Saudi Arabia, as well as strengthen coordination on energy policy. China also intends to deepen its ties with the kingdom in areas such as infrastructure construction, investment, e-commerce, aerospace research, security and counterterrorism efforts, Xi told Saudi Crown Prince Mohammed bin Salman during his visit to Riyadh, according to Chinese state media and information from the BBN service. An opportunity to replenish U.S. strategic oil reserves? There are also rumors in the market that the Americans may be manipulating oil prices in some way to be able to replenish strategic oil reserves at the lowest possible cost. At the beginning of December, they fell to their lowest level since 1984, as the Americans, by releasing them into the market, are trying to whip up fuel prices to lower inflation. However, only further data will be able to show whether the Energy Department has actually replenished them, at what appear to be currently attractive prices. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.    

"The S&P 500 could break through the 3,600-point level in the near term as companies cut their earnings forecasts for 2023," - said David Kostin, chief equity strategist at Goldman Sachs. This would mean a decline in the main S&P 500 index of more than 8%. How could someone take advantage of the potential increase in volatility? Fear Index The instrument that assesses the volatility for the S&P 500 (US500) index over the next 30 days is the CBOE Volatility Index (VIX). Its value is determined by the pricing of options on this index. However, let us remind ourselves of the possible options. There are derivatives that give buyers the option to buy call (or in the case of put options, to sell) at a given price in the future of the underlying instrument. Importantly, call and put option quotes are priced independently. Because historically the index has reached its highest levels at times of major falls, it is commonly referred to as the fear index. Source: Conotoxia MT5, VIX, Weekly The fear index peaked during the 2008 real estate crisis. - around 60 points and during the 2020 pandemic crisis. - around 80 points. Currently, its value is around annual lows, at around 20 points.  Theoretically, the value of the fear index could increase with sudden movements (regardless of direction), and with slow changes the index could reach lower values. In line with this, the decline of the S&P 500 index by more than 17% since the beginning of the year has not triggered sizable increases in the fear index. Source: Conotoxia MT5, US500, Weekly ETFs on the VIX index A long-term alternative to investing in the Fear index are ETFs that replicate its movements. It seems that special caution should be exercised in this type of investment due to their complex structure and built-in leverage. The first fund is the Ultra VIX Short-Term Futures ETF (UVXY), which gives exposure to the index with average leverage times 2. It consists of short-term contracts on the VIX index quotes. If we would like to trade in the opposite direction, ProShares offers the opportunity to invest in the Short VIX Short-Term Futures ETF (SVXY). It consists of the same contracts as its predecessor only with opposite positions. Source: Conotoxia, MT5, UVXY, Weekly What can we expect in the future on the VIX? Forecasting changes in the fear index could be difficult and fraught with risk. However, specific events trigger specific market reactions. These include, for example, the publication of surprising data to which investors seem to pay particular attention. At present, these may include: employment figures in the non-farm sector, the Fed's interest rate decision or inflation indicators. The advantage of the fear index, however, seems to be that if there is volatility following the publication of data, we may not have to worry about its impact on the broad market, as the value of the index depends on the expected rate of change.  Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Protests in the streets, but also the worsening economic situation, may be causing Chinese authorities to decide to make concessions on restrictions related to Covid-19. China was the last country with a firm regime against those infected. Now comes the easing of restrictions. The Hong Kong Stock Exchange's Hang Seng 50 index has risen more than 30 percent since its low, with the iShares MSCI China A ETF up 17 percent since the end of October. This may have to do with an attempt to discount a move away from lockdowns in China and an improved outlook for the local economy along with seemingly attractive company valuations. Chinese authorities have already signaled to ease restrictions in the form of allowing people without a negative test result to use public infrastructure like transportation or supermarkets. Moving with a valid negative result was previously mandatory. As Bloomberg reported, China is expected to announce a further relaxation of Covid control measures today - including allowing some infected people to quarantine their homes as a nationwide policy, according to people familiar with the matter. In addition, Chinese economic data may indicate that a change in direction is needed. Source: Conotoxia MT5, CNYA, Weekly China's trade surplus fell to $69.84 billion in November 2022 from $71.7 billion in the same month the previous year, well below market forecasts for a surplus of $78.1 billion, according to tradingeconomics. It was the smallest trade surplus since April, due to weakening global and domestic demand. Exports fell 8.7% year-on-year for the second consecutive month, due to weakening foreign demand caused by high inflation and supply disruptions. Imports, on the other hand, fell at a faster pace of 10.6%, for the second month in a row, due to weakening domestic demand as a result of widespread restrictions related to the epidemic. Hence, easing restrictions could be key to China's economic recovery, and senior Chinese officials are debating an economic growth target, Bloomberg reported. For next year, it is expected to be around 5%, according to people familiar with the discussion, as Beijing shifts gears to support economic recovery. Given recession forecasts for the eurozone, the UK or a slight recession in the US in 2023, China appears to be coming out on top in expectations of a GDP rebound next year. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The Bank of Australia seems to be a fairly conservative central bank, which does not surprise with big interest rate hikes, but raises them systematically. This time was no different at the last meeting of the year. The Reserve Bank of Australia raised the interest rate by 25 basis points to 3.1% at its last meeting in 2022, matching market forecasts. The move marked the eighth consecutive rate hike, raising borrowing costs to levels not seen since November 2012, with the central bank announcing further increases as inflation in Australia is too high, tradingeconomics reports. The widely expected decision means the central bank has raised interest rates since May to 3 percentage points, the sharpest annual tightening of monetary policy since 1989. The committee reiterated that the interest rate is not a predetermined rate, as the size and timing of future increases will continue to be determined by incoming data. The council added that inflation in Australia will peak at around 8% this year, before weakening in 2023 and reaching just above 3% in 2024. Policymakers have reaffirmed their commitment to bringing inflation to target and will do whatever is necessary to achieve this. Source: Conotoxia MT5, AUDUSD, Daily Australian dollar exchange rate after the decision From mid-October to today, the AUD has strengthened against the USD by almost 9%. Today, after the decision, the AUDUSD exchange rate rose to 0.6723, which may represent an increase of 0.4% since the beginning of the day. Thus, higher and higher peaks and higher and higher lows could be observed on the chart of the described currency pair, which may be characteristic of a potential uptrend. From the point of view of technical analysis, only overcoming the vicinity of 0.6640 could lead to the formation of a new low within the recent upward structure. Interest rate hikes the cause of recession? Fitch thinks so As reported by BBN, Fitch Ratings once again lowered its global economic growth forecast for next year, citing the intensification of interest rate hikes by central banks, as well as the worsening trend in China's real estate market. Fitch lowered its growth forecast by 0.3 percentage points to 1.4% for 2023, while seeing the U.S. economy with slight GDP growth. Chinese growth, on the other hand, is expected to rise 2.8% this year and 4.1% in 2023. The eurozone economy is also expected to grow slightly, thanks to the easing of the energy crisis. The rating agency also said that central banks in the US and Europe will continue to raise interest rates above initial estimates. At the same time, a recession could be expected in the Eurozone and the UK this year, and in the US in the second half of 2023, the agency added. Source: Conotoxia MT5, US500, Weekly Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Over the past 12 months, individuals directly associated with US semiconductor manufacturer Texas Instruments (TexasInst) sold shares worth a total of more than US$6.9 million. The biggest contributor was CEO Richard Templeton, who disposed of shares worth US$5.9 million. What could this mean for the value of this company's shares? Situation of the semiconductor industry Since we learned of Warren Buffett's biggest purchase in Q3 of this year, which was the world's largest semiconductor manufacturer Taiwan Semiconductor (TaiwanSemic), interest in the sector may have increased significantly. Since then, shares in the Taiwan-based company have risen by more than 30 per cent. Source: Conotoxia MT5, TaiwanSemic, Daily Data from the MacroMicro portal shows that the volume of new electronic equipment orders in the United States increased by 6 per cent year-on-year in October, and semiconductor demand appears to be largely dependent on these orders. Semiconductor billing volumes increased by 11.55 per cent y/y in the US, while global demand fell by 3 per cent y/y. The US is the world's largest single customer for these products, with a market share of as much as 22 per cent. However, 62 per cent of global demand is provided by the Asia-Pacific region (excluding Japan). Here, we could see a decline in purchase volumes of 11.51 per cent year-on-year. Which may confirm the slowdown announced by many analysts for this sector, and especially for China, which seems to have been struggling with pandemic problems in recent months, compounded by the zero-Covid policy.  Financial situation of Texas Instruments The financial figures of the semiconductor manufacturer in question may suggest success. Revenues have been on a continuous upward trajectory over the past nine quarters, currently up by 12.88 per cent year-on-year. Over the same period, operating profit has increased by 16.18 per cent year-on-year. The company also boasts a steadily increasing net profit margin, which currently stands at 44 per cent, against a sector average of 35.9 per cent, which may confirm the company's competitive advantage. According to an analysis by Heavy Moat Investments comparing Texas Instruments to the largest US semiconductor manufacturer Intel (Intel): "Texas Instruments has a much more asset-light business model. The significant difference between the two companies is that TI manufactures Analog Chips while Intel manufactures Digital Chips. We can see that Intel requires a much higher CapEx than TI, even though TI has also ramped up CapEx. TI also produced much higher and rising margins, while Intel has seen margins plummet in recent years due to a switch in business models." The stock market saying seems to be: "there are many reasons to sell a stock, but only one to buy it". In this case it may well apply. What does Wall Street think of Texas Instruments' share price? According to the Market Screener website, the company has 32 recommendations, and the majority of them read: "Hold". The average target price is set at $172.39, which is around the last closing price. The highest target price is at USD 230 and the lowest is USD 140. Source: Conotoxia MT5, TexasInst. Daily Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The beginning of the week seems to have started with a continuation of the rally in risky assets, which is beginning to resemble the proverbial Santa Claus Rally. The U.S. dollar cheapened at a rate not seen in 12 years, stock market indexes and precious metals climbed. One of the reasons for the improvement in market sentiment is cited as the loosening of Covid-related restrictions by Chinese authorities. Protests on the streets and weaker data from the local economy may have pressed policymakers so hard that they decided to make partial concessions. According to tradingeconomics, the Caixin China General Services PMI fell to 46.7 points in November 2022 from 48.4 in October, indicating the 3rd consecutive month of decline. It was also the steepest decline in the services sector since May, due to Covid's restrictive measures, which could affect demand and service activity. New orders fell the most in six months, with employment contracting at the fastest pace since the survey began in November 2005. Meanwhile, export orders began to rise again as overseas demand picked up after regulations on international travel were eased. In addition, business sentiment fell to levels seen eight months ago due to concerns about how long it will take to contain the virus and the impact of restrictions on business, according to the published data. Source: Conotoxia MT5, USDIndex, Weekly China eases restrictions. Risky assets may gain China's National Health Commission reported Monday that it has identified 30014 new cases of Covid-19 in the past 24 hours, with the country seeing a drop in infections in recent days after a record high when more than 40,000 cases were seen in a single day, BBN reported. What's more, local Chinese authorities have agreed to relax some measures related to Covid-19. In Beijing and Shenzhen, a negative test will no longer be required to enter some public places, such as public transportation and supermarkets. This course of events in China may help financial markets and the global economy, as China may now be the "green island" from the standpoint of GDP growth momentum. Source: Conotoxia MT5, VIX, Weekly Fear in the financial markets, as measured by the VIX index (expected monthly volatility on the S&P500 index) fell last week to its lowest level since August. If the decline were to continue, the VIX could reach its lowest level since January 2022. What are the markets waiting for? This week may be quieter due to the fact that the Fed's interest rate decision will be published as early as December 14. It is the expectation of smaller interest rate hikes in the US that could be the second factor helping the markets climb higher today. Nevertheless, the market is also assuming that in 2023. Fed will cut rates. Information on this subject could be crucial next week. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.      

Last night's speech by Jerome Powell, chairman of the US Federal Reserve, was one of the key events of the day. Investors were expecting clues about further changes in US interest rates, and they got them. Powell sounded more dovish. During his speech at the Brookings Institute, Jerome Powell signaled that the Fed may slow the pace of interest rate hikes in December, "the time for a moderate pace of rate hikes may come as early as the December meeting," - Powell said, while adding that it is likely "that restoring price stability will require maintaining policy at restrictive levels for some time." In addition, Powell added that historically premature policy easing has been strongly discouraged. "We will stay the course until the job is done," he said. - he concluded. Federal Reserve Chairman Jerome Powell also said that he "doesn't want to over-tighten" interest rates, as the central bank doesn't see fit to "crash the economy and clean up after it." Nevertheless, answering questions at a session organized by the Brookings Institute, Powell stressed that "cutting rates is not something I want to do anytime soon," the BBN service concludes. This was the Fed chairman's last public appearance before the December interest rate decision. Source: Conotoxia MT5, USDIndex, Daily Markets in a little euphoria The U.S. Nasdaq index hit its highest level in 10 weeks yesterday, the AUD/USD pair rate hit its highest level in 11 weeks, NZD/USD rose to levels seen 2.5 months ago, gold reached its highest level in 2 weeks, and the dollar index fell in November in percentage terms by the strongest amount since 2010. This reaction of the markets seems to show quite well how high investors' hopes were placed on Powell's speech, and that they were not disappointed. In addition to Powell's speech, events from China may also provide support for the markets. Investors may be pleased with China's softening stance on Covid. The top official in charge of tight restrictions on the Covid outbreak said the country's fight against the virus is entering a new phase amid a waning omicron variant, rising vaccination rates and broader experience in preventing Covid. Source: Conotoxia MT5, US100, H4 What's next ahead? After the Fed chairman's speech, it seems that the key for the markets may be Friday and data from the US labor market. It is in it that high hopes may be placed to resist the economic slowdown. However, if the labor market situation began to deteriorate as well, the Fed could face a difficult choice. Which to fight? With inflation or with the deterioration in US employment. That is what we will find out tomorrow. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Elon Musk wrote on the platform he owns: "Apple has mostly stopped advertising on Twitter. Do they hate free speech in America?" and "Apple has also threatened to withhold Twitter from its App Store, but won't tell us why". In response to presenter Liz Wheeler's tweet, he in turn announced: "I certainly hope it doesn't come to that, but yes, if there is no other choice, I will make an alternative phone." What can Tesla afford to do? Elon Musk is famous for accomplishing things that seem impossible. From launching rockets into space that still return to earth on their own, to creating the Starlink internet, to buying Twitter shares for more than $40 billion. Wouldit now actually challenge the iPhone maker? Let's try to come down to earth and compare the capabilities of the billionaire Tesla's biggest company (Tesla) and Apple (Apple). There is no denying the tremendous growth rate of the electric car manufacturer. The company's revenue growth was 55.9% year-on-year and operating profit rose by 84% in the same period. The manufacturer's net margin now stands at 14.95%, with an average of 7.5%. - according to Statista. The company additionally has as much as US$21.1 billion in cash and cash equivalents to spend on research and development. However, it seems that producing another smartphone with its own system (independent of Apple or Google) would not happen overnight. Therefore, even if the decision had already been taken, we would have seen the results, as with electric cars, after a few years. It seems that investors have recently become pessimistic about the future of Tesla's shares, which have fallen by more than 55% since their peaks. Source: Conotoxia MT5, Tesla, Weekly Apple still with no official response The company of the smartphone manufacturer, among others, has not yet issued an official response. However, it seems that the action limiting the availability of Elon Musk's app in the App Store could be due to the company's policy regarding the quality of Twitter's verified content. Excluding the app from access to iPhone users and reducing advertising spend on that platform could be a significant blow. According to ad management firm Pathmatics, Apple was the top advertiser on Twitter in the first quarter of this year, spending around US$48 million on advertising here, which accounted for around 4% of the company's total revenue. Source: Conotoxia MT5, Apple, Weekly Apple is currently the world's highest valued company with a capitalisation of US$2.25 trillion. It also boasts satisfactory results. Revenues are up 8% year-on-year and operating profit is up 4.66%. The company appears to be leveraging its competitive advantage with a high net margin of 25.31%. Meanwhile, according to the Gurufocus platform, the average for the technology sector is 19.6%. An additional advantage for the manufacturer with the bitten apple symbol is USD 48.3 billion in cash and cash equivalents. Looking at the data presented, it seems that creating a new smartphone that enters mass production, maintains standards and gains global popularity may be even more challenging than producing an electric car. Therefore, it seems possible that the conflict would be resolved in the coming weeks. Otherwise, Twitter could be the biggest casualty. Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Financial markets may focus on two events today. The first may be the inflation reading for the Eurozone for November (estimates), and the second will be a speech by Federal Reserve Chairman Jerome Powell. Yesterday's inflation data from Germany showed that German consumer prices rose 10.0% year-on-year in November, slightly less than the 10.3% predicted by analysts, according to data released by the Federal Statistical Office (Destatis). A month earlier, in October, inflation was 10.4%. On a monthly basis, consumer prices fell by 0.5%, the BBN service reported. The softer inflation reading from Germany may carry over into today's inflation publication for the eurozone as a whole. The consensus calls for a reading of 10.4% versus 10.6% a month earlier. Investors in the interest rate market, along with lower inflation readings, have pushed back their expectations for action by the European Central Bank. As Bloomberg calculates, interest rate traders now see only a 24% chance of a move greater than 50 basis points at next month's ECB meeting, while as recently as Tuesday it was as high as 52%. Inflation data from the zone will be released at GTM+1. Source: Conotoxia MT5, EURUSD, Daily Markets ahead of Jerome Powell's speech According to Bloomberg, implied volatility in the FX options market is rising in the shorter term, as investors position themselves ahead of Fed Chairman Jerome Powell's key speech on the economy and labor market. The speech is scheduled to begin at 7:30 pm GTM+1 at the Brookings Institution. Investors could expect the speech to offer clues on further action on interest rates or where the current cycle would end, as well as whether an interest rate cut in 2023 is possible. According to Bloomberg data, the peak of the U.S. hike cycle is priced by the market for May or June 2023 at a level close to 5 percent, while the federal funds rate is expected to fall to 4.4 percent by January 2024. This would mean that U.S. interest rates could reach their peak in the same year, and then, according to the market, the Fed could opt for two cuts of 25 bps each. Source: Conotoxia MT5, US30, Daily Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Looking to take advantage of the current uncertainty in the markets over the Middle Kingdom's continued policy on pandemic restrictions? We have selected funds that you could watch out for in the near term.  Current situation in China After the introduction of the zero-Covid policy by China's Communist Party, it seemed that the Chinese economy might slow down significantly. The situation, which forced many citizens to stop doing their business, may have caused the people of the Middle Kingdom to start protests. As Reuters reports, "Police stopped and searched people at the sites of weekend protests in Shanghai and Beijing, after crowds there and in other Chinese cities demonstrated against stringent COVID-19 measures disrupting lives three years into the pandemic." Now, following Saturday's announcement by Chinese authorities regarding the easing of months-long closures in various regions of the country in stages. Markets appear to be reacting particularly optimistically. Hong Kong's main index, the Hang Seng, is up more than 5% today.  How could you invest in China? The characteristics of the Chinese stock market seem to limit the ability of an international investor to purchase assets in this market. For this reason, many entities originating from China are listed on multiple exchanges simultaneously. The iShares MSCI Hong Kong ETF (EWH) is one of the funds giving exposure to the previously mentioned Hang Seng Index. It consists of 23.88% of Hong Kong-listed property companies. The second largest weighting is insurance companies (22.36%), followed by financials (11.79%) in third place. It appears that the currently tough property market in China, following the introduction of restrictions on developers' borrowing capacity, may be reducing the potential of this market. Nevertheless, the average price-to-earnings P/E ratio is around 13, which may speak to the undervaluation of this fund. Source: Conotoxia MT5, EWH, Daily We could get a glimpse of the broad market for Chinese equities with the iShares MSCI China ETF (MCHI), which has as much as 30.5% of its value in commercial property companies. In second place in terms of weighting is the communications sector (17.41%), and in the last place of the weighting podium is the finance sector (15.55%). As with the previous fund, it has significant exposure to one of the largest sectors of the Chinese economy, real estate. Interestingly, the largest position in the fund, accounting for, as much as 11.74%, is the technology giant Tencent (Tencent). The average price-to-earnings P/E ratio for this fund is just 9.88. This seems  to be due to negative sentiment on the share prices of construction developers. Source: Conotoxia MT5, MCHI, Weekly The third fund already giving direct access to the Chinese A-share market is the iShares MSCI China A ETF. It appears to be the most sectorally diversified relative to its predecessors. Companies from the financial sector are the most heavily weighted, accounting for 17.37% of the fund's value. In second place, with a slightly lower weighting, are companies from the consumer goods sector (17.32%). The podium is rounded off by industrial companies (16%). On average, the price-to-earnings P/E ratio takes on a value of 14.35. Such a value could be considered well valued, giving these potentially smaller growth opportunities.  Source: Conotoxia MT5, CNYA, Daily Knowing that many applications and websites are banned in the Middle Kingdom, we can access Chinese internet companies that provide similar services such as Google, Facebook, Twitter, eBay, Amazon, etc. Therefore, the latest passive fund to look out for is the KraneShares CSI China Internet ETF (KWEB). It is made up of 44 companies with 50% in the consumer goods sector, 36.24% in communication services and 4% in the real estate industry. The largest position is Alibaba Group Holding (Alibaba), which weighs in at 9.36% of the fund's value. It has an average P/E of 11.7, which, additionally taking into account the strongly growth-oriented nature of the fund's companies, seems to give signals for upside in the event of an easing of the pandemic tightening situation.  Source: Conotoxia MT5, KWEB, Daily Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.     search   g_translate    

This morning, the US dollar seems to be losing ground again in anticipation of upcoming macroeconomic data later in the week. We are specifically talking about data from the US labor market and the popular NFP. Improvement in the markets. Is the dollar losing again? This morning, the US dollar seems to be losing ground again in anticipation of upcoming macroeconomic data later in the week. We are specifically talking about data from the US labor market and the popular NFP. The U.S. Dollar Index on Tuesday seems to have fallen below 106.5 points, despite earlier statements by U.S. Federal Reserve officials. James Bullard of the St. Louis Fed said the central bank still has "a lot of work to do to become restrictive," reiterating that "the interest rate needs to rise to at least 5% to bring inflation down." New York Fed President John Williams also said that "rates must continue to rise and remain high until next year, while being open to a rate cut in 2024." However, the Fed is widely expected to slow the pace of tightening to 50 basis points in December after four 75 basis point hikes in a row. Meanwhile, Fed Vice Chair Lael Brainard warned that lower supply elasticity due to the effects of Covid-19 and the war could lead to a period of higher volatility in inflation data. This phenomenon could be the largest in several decades. Brainard added that "the experience with the pandemic and the war highlights the challenges for monetary policy in responding to a prolonged series of adverse supply shocks," BBN reported. Source: Conotoxia MT5, USDIndex, H1 China's infections decline One short-term factor that appears probably to influence the behavior of financial markets is the situation in China. After a record number of infections, investors' eyes may be on both the protests and the scale of the outbreak. According to the latest information, the number of newly registered cases fell for the first time in more than a week, the Health Commission (NHC) reported. The figure was said to have dropped from more than 40,000 infections to 38645 newly registered infections. The fewer infections there are, the fewer restrictions may not be enforced, as there would be no need for them, which could help both Chinese citizens and the economy. Additionally, Chinese authorities have announced a press conference on the Zero-Covid policy, which may already have markets hoping for a loosening of restrictions. Stock market, commodities and cryptocurrencies rebound U.S. index futures seem to be pointing to the possibility of a positive opening to the session on Wall Street. Futures on the Dow Jones Industrial Average are up more than 0.2%, while the Nasdaq 100 is up 0.6% this morning. Meanwhile, in Shanghai, the local stock index rose more than 2% to 3144 points. On the commodities market, we could see oil prices rise by more than 1.6% to $78 per barrel. Gold, on the other hand, rose 0.7% to $1,753, and silver rose 1.45% to $21.20 per ounce. The cryptocurrency market is also trying to bounce back. The price of bitcoin has risen to $16456, and Ether is back above $1200.   Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Precious metals, which could be part of an investment portfolio, can count as November’s successful ones among others. We are mainly talking about gold and silver priced in US dollars, whose prices in the eleventh month of this year have definitely increased. Although the month isn't over yet, we're already having a look at what the December statistics may indicate. Gold may be in the spotlight in November, as prices appear to be heading for their biggest monthly increase since mid-2021, currently at around 7.5%. Gold seems to have been gaining recently, thanks to a weakening dollar and to declines in U.S. bond yields. The market may be assuming that the Fed would not be able to keep interest rates at around 5% for quite some time, and there may be cuts in the federal funds rate in 2023. With this narrative, gold appears to be entering December, a month in which the metal has had a positive return for five years in a row. As Bloomberg calculates, December has averaged a 4.2 percent gain since 2017. Gold saw its biggest December price jump in 2020, appreciating by almost 7% then, while the smallest increase took place in December 2017, at 2.23%. In contrast, December 2016 ended with a decline of 1.91%. Source: Conotoxia MT5, XAUUSD, Monthly Silver with more volatility than gold? Silver, like gold, also ended every December up since 2017, with an average return of 7.1%, Bloomberg reported. The best December statistically in this period was December 2020, when silver rose 16.61%. In contrast, silver rose 3.15% in December 2017, while the price fell 3.39% in 2016. In November, silver seems to have led the rise among popular futures contracts. To date, since the beginning of the month, the price has risen more than 13% above $21 per ounce. In contrast, year-to-date, silver denominated in USD is losing about 7.5%. Source: Conotoxia MT5, XAGUSD, Monthly In the silver market, one curiosity may be that a one-ounce Silver American Eagle coin is valued at more than $35. Meanwhile, silver in the form of a one-ounce contract costs about $21. This gives a price difference between a physical ounce and a paper ounce of silver of more than 65 percent, according to data from the Monex service, such a discrepancy has not been seen for at least a decade. This could be one of the favorable factors for silver in the coming month, improving December's precious metals statistics. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

Unlike European countries or the US, China still maintains a strict policy against the Covid-19 outbreak. The authorities do not hesitate to use violence to blunt any opposition to the policy, as has happened, for example, at the Foxconn factory, which is responsible for, among other things, producing iPhones for Apple. The number of new coronavirus infections in China has risen by 40347, the country's health authorities reported Monday. The latest number represents another daily record for China, with 3822 symptomatic and 36525 asymptomatic cases documented in the past 24 hours. No deaths caused by the virus have been reported in the same period, BBN reported. How are stock markets and the price of oil reacting? The current power politics and brutality seem to be leading to protests, which could have an impact on the markets initially in the short term and then in the long term. Protests against lockdowns in China intensified over the weekend, spreading to cities such as Shanghai, Nanjing and Urumqi. Western media confirmed that demonstrations were taking place on the streets and at universities, and that there was an increased police presence at protest sites. There were also reports of clashes between people and police officers. Asian stock markets appear to have seen declines on Monday as a consequence of the protests, and President Xi Jinping was reportedly urged by some demonstrators to step down. The Shanghai Stock Exchange index fell nearly 1.5 percent, with U.S. index futures posting morning declines ranging from -0.4 percent (Dow Jones Industrial Average) to -0.8 percent, (Nasdaq 100). Crude oil also came under pressure from the protests. WTI crude oil futures fell about 3 percent on Monday to around $74 per barrel, slipping to the lowest levels since last December. The oil price consequently began a fourth week of declines, as uncertainty over politics in China, the country that is the largest importer of crude oil, may affect the outlook for crude demand. Source: Conotoxia MT5, XTIUSD, Daily Possible long-term implications China appears to be a country that would sooner stifle protests by brute force than allow them to affect a change in policy. Nevertheless, if such events were to occur, it would likely be one of the most positive returns for financial markets this year. We saw a foretaste of the market euphoria associated with rumors that China is to abandon its zero Covid policy on November 4. Then, after the market rumor, investors went on a buying frenzy. The lifting of lockdowns could allow China's economy to grow stronger and, as a result, lead to increased demand for raw materials and other goods and products. With the current recessionary-stagflationary sentiment, this could be one of the more positive factors. What are the chances of such a scenario materializing? In the short term, the markets seem to indicate that they are small, but it is worth keeping in mind. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.      

Sunday marked the start of the World Cup in Qatar. It seems that it could not have taken place without controversy over the preparations for the event. After yesterday's Thanksgiving holiday in the United States, today we may see increased shopping traffic in celebration of Black Friday. A weakening dollar and falling bond yields may have driven the broad market this week.  Macroeconomic data On Wednesday, we learnt about the PMI reading on managerial sentiment in German industry. The reading of 46.7 points surpassed the expected 45 points and came as a positive surprise over the previous reading of 45.1 points. We could also see values for the same indicator from the UK, with a reading of 46.2 points (45.7 had been expected), against the previous reading of 46.2. From this we could see a warming of the market climate, which appears to have caused a 1% rise on the main German DAX index (DE40) since the start of the week.  Source: Conotoxia MT5, DE40, Weekly On the same day, we learned about the number of building permits issued in the United States. Here, the data turned out to be more modest than expected, amounting to 1.512 million (1.526 million was expected). There was also news from the US economy on crude oil inventories, which fell by 3.69 million barrels (a drop of 1 million barrels was expected).  On Thursday, Americans celebrated the Thanksgiving holiday. In Europe, on the other hand, data from the Ifo index measuring expectations for the next six months among German entrepreneurs may have come as a positive surprise. The index came in at 86.3 points, while 85 points were expected, which, like the PMI index, may have comforted markets in their expectations for the future. The stock market Analysts may have been positively surprised by Q3 earnings this week. Among others, we saw better-than-expected earnings per share from technology, software and laboratory equipment maker Agilent Technologies (Agilient), whose EPS came in at 1.53 (expected 1.38). Zoom Video (Zoom), a popular company during the pandemic, also surprised positively, with EPS of 1.07 (expected 0.83).  On Tuesday, US semiconductor company Analog Devices (AnalogDev) showed EPS of 2.73 (2.58 expected), and the maker of software for industries including architecture, engineering and construction showed earnings per share in line with EPS guidance of 1.7.  Of the 11 sectors of the US economy, consumer goods sales grew strongest. The Consumer Staples Select Sector SPDR Fund (XLP) index has gained more than 3% since the start of the week, which may have been influenced by Friday's Black Friday. Source: Conotoxia MT5, XLP, Weekly Currency and cryptocurrency market For another week in a row, we could see a weakening of the US dollar. The valuation of the EUR/USD pair has risen by 0.7% since the beginning of the week and currently stands at 1.04. The weakening of this largest reserve currency was also evident on the GBP/USD pair, which rose by 2% to around 1.21. The other currencies do not seem to show increased volatility. Source: Conotoxia MT5, EURUSD, Weekly There could still be a gloomy mood in the cryptocurrency market. Not even the reports that the largest exchange Binance has set up and contributed USD 1 billion to a fund to support crypto projects are helping. The price of bitcoin is hovering around US$16500 and ethereum around US$1190. Source: Conotoxia MT5, BTCUSD, Daily What could we expect next week? Next week's key macroeconomic data will start with Tuesday's German CPI inflation reading. On the same day, we will learn the previously discussed Chinese manufacturing PMI. On Wednesday, the Eurozone CPI inflation readings appear to be particularly important. On this day, we will also learn the quarterly change in GDP for the United States. On Thursday, we will learn the PMI values for Germany, the United Kingdom and the United States. At the end of the week, we will find out the unemployment rate in the USA. Tuesday will see Q3 financial results from business software developer Intuit (Intuit). Wednesday will bring a report from cloud software company Salesforce (Salesforce). We will end the week with a report from semiconductor company Marvell (MarvelTech). Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

Looking at the company's recent Q3 results and its share valuation, it's hard not to get the impression that investors could choose it as a cure for worsening times. At a time when the main S&P 500 index (US500) has fallen by more than 16% since its January highs, the fast food giant's valuation has risen by 5%. We decided to see if the average American would switch to a BigMac in times of crisis? The company's financial position Overall year-to-date revenues, despite experiencing a 5% year-on-year decline in Q3, are up 9% year-on-year. According to CEO Chris Kempczinski: "As the macroeconomic landscape continues to evolve and uncertainties persist, we are operating from a position of competitive strength. I also want to thank our franchisees, who have done a tremendous job navigating this environment, while providing great value to our customers."  Source: Conotoxia MT5, McDonalds, Weekly Revenue volumes may have been positively impacted by price increases across the sector. The company seems to have done quite well in passing on costs to customers, as we saw in, for example, the price of a cheeseburger in California, which increased by 50%, from US$0.99 to US$1.48. This was the first price increase for this sandwich in 14 years.  Earnings per share fell by 6.29% year-on-year, which the company explained by rising costs in the Eurozone caused mainly by energy prices. However, we learned from the report that: "comparable sales in the US increased by more than 6% during Q3, marking the ninth consecutive quarter of comparable sales growth in the segment". Currently, the company's price-to-earnings P/E ratio is 34, which may indicate signs of overvaluation. However, if analysts' expectations for future earnings are taken into account, the P/E ratio is 26.2, and this could give potential for further share price increases. The company has also announced another dividend increase. Will Americans eat at McDonald's in times of crisis? According to an analysis by NUMBEO, a company that measures the cost of living in various places around the world, the price of lunch in low-cost restaurants fluctuates between US$10-30 (average US$16). The same spread for an average McMeal set at McDonald's, depending on the state, ranges from US$7 to US$12 (average US$8.5), indicating a meal at the popular fast food outlet is twice as cheap. The question may immediately arise, will Americans decide to cook at home? However, this seems unlikely due to the fact that, according to Statista, as many as 82% of the country's citizens live in cities, where eating out is much more popular. In addition, preparing a meal at home does not seem to be cheap enough to compete with eating at fast food outlets. Therefore, we could surmise that even if the income of the average American worsens, it would be difficult to give up eating out cheaply. Alternatively, the portions ordered may be smaller and thus cheaper, but this could be to everyone's advantage. After all, according to the 2017-2020 National Health and Nutrition Examination Survey, 41.9% of adults nationally (USA) are struggling with obesity. Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

The minutes of the European Central Bank's latest meeting, released yesterday, may indicate that policymakers would not back away from further interest rate hikes, even despite the risk of recession. How is the euro exchange rate reacting? Policymakers at the European Central Bank agreed at their last meeting that the central bank should continue normalizing and tightening monetary policy to combat high inflation, even in the event of a shallow recession, according to a report on the central bank's October meeting, Trading Economics reports. Officials noted that the outlook for inflation continues to deteriorate, with inflation running too high and many times above forecasts, and that there is a growing risk of its perpetuation and the emergence of second-round effects and a wage-price spiral. However, the central bank has hinted that it may want to halt ongoing interest rate hikes if there is a prolonged and deep recession, which could curb inflation to a greater extent. The ECB raised its key interest rate by 75 basis points in October, raising borrowing costs to the highest level since early 2009, with broad support for a meeting-by-meeting approach to future monetary policy decisions, depending on the data, according to minutes released yesterday. Euro exchange rate this week and month For the euro, the current month appears to be the best since July 2020. The EUR/USD exchange rate rose more than 5 percent in November, reaching its highest level since late June 2022. It seems that, in addition to improving data from the European economy, there may also be an overestimation of expectations for further Fed actions. The U.S. dollar may already be "rallied" if no new factors emerge in the U.S. pushing up expectations for more interest rate hikes. Source: Conotoxia MT5, EURUSD, Monthly In front of the EUR/USD, however, there are potential resistances from the chart. We are talking about the lows of late 2016 and the low of March 2020. Thus, the potential resistance zone could stretch between 1.0320 - 1.0640. Nevertheless, looking at the chart, we could see that we are dealing with the biggest correction in the trend since the beginning of 2021. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

"War, war never changes" - one popular science fiction universe began with this slogan. It seems particularly relevant now in the face of Russia's armed assault on Ukraine. Without delving into geopolitics, we decided to analyse the effectiveness of investments in armaments companies. iShares U.S. Aerospace & Defence ETF One way could be to invest in passive funds that give exposure to the sector, and an example of such a fund could be the iShares U.S. Aerospace & Defence ETF (ITA). The official website states that it gives exposure to US companies that manufacture commercial and military aircraft and other defence equipment.  The company with the largest stake in this fund is RAYTHEON TECHNOLOGIES CORP (RaytheonTec). In terms of revenue and market capitalisation, it is one of the world's major aerospace and defence manufacturers. It accounts for 21% of the total portfolio value. The average price-to-earnings P/E ratio for this fund is 22.9, which could be interpreted as the first sign of overvaluation. Does this mean that the market is now pricing in an extension of the conflict?  Source: Conotoxia MT5, ITA, Weekly Aerospace & Defence companies The previously mentioned RAYTHEON TECHNOLOGIES CORP (RaytheonTec) is one of the largest intelligence providers to the United States. It also manufactures aircraft engines, avionics, aerostructures, cyber security, guided missiles, air defence systems, satellites and drones. The company is also a large military contractor, receiving a significant portion of its revenue from the US government.  Revenue for the company does not appear to have increased significantly since the start of the conflict in eastern Europe. Growth has been 4.5% year-on-year and operating profits have increased by 10% year-on-year in the period. Analysts assume an increase in its earnings in the coming quarters, as the Forward P/E price-to-future earnings ratio is 18.52 (the current P/E is 32.38), which could mean it is potentially undervalued. Source: Conotoxia MT5, RaytheonTec, Daily Lockheed Martin Corporation (Lockheed) is the second company to operate in four business segments: aeronautics, missiles and fire control, rotary and mission systems, and space. Revenues are currently up 3.46% year-on-year, while operating profits are down 5.88% year-on-year. The Forward P/E price-to-future earnings ratio was 17.8 against a current value of 22.06. The company appears to have a similar situation to the one described earlier, but may have less potential for growth.  The last company we will look at is Northop Grumman Corporation (Northop), which is involved in aerospace and defence technology. Being, it seems, one of the most undervalued relative to its sector, currently achieving a P/E ratio of 14.91. When compared to the Forward P/E of 21.73, this company may offer one of the greatest growth potentials for the sector. The manufacturer's revenues (including drones) grew by 2.88% year-on-year, while operating profits in the period fell by 19% year-on-year.  Source: Conotoxia MT5, Northrop, Daily   Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Conotoxia.com

Americans celebrate Thanksgiving today, which may translate into less activity for investors overseas. However, before that happens, the market seems to be still alive with yesterday's "minutes" from the latest FOMC meeting. The minutes are a record of events and statements at the meeting of the Federal Open Market Committee, which makes decisions on interest rates in the United States. They show that the vast majority of Fed officials felt that a slowdown in the rate of increase in the federal funds rate would probably be appropriate soon, as this would allow the Committee to better assess progress toward achieving its goals of maximum employment and price stability. Policymakers also noted that with inflation showing no signs of abating and the economy's supply-demand imbalance persisting, the ultimate level of the federal funds rate that would be needed to achieve the Committee's goals is somewhat higher than they had previously expected. The Federal Reserve raised the target range for the federal funds rate by 75 basis points to 3.75%-4% at its November 2022 meeting, marking the sixth consecutive rate hike and the fourth consecutive 75bp increase. As a result, the cost of dollar funding has risen to its highest level since 2008, Tradingecnomics calculated. Slower hikes - how are the dollar exchange rate and indexes reacting? The dollar index fell below 106 points on Thursday morning, slipping for the third day in a row toward the lowest levels since mid-August. For the week as a whole, the dollar seems to have lost to all major world currencies. Meanwhile, the British pound was able to record the biggest strengthening, gaining more than 1.7 percent, followed by the New Zealand dollar, which saw a historic interest rate hike yesterday. In third place on a weekly basis is the Swiss franc, with a strengthening of about 1.5 percent. Thus, it seems that the dollar's rally after the US interest rate hike may have slowed or come to an end, and now the market could at least move to a larger correction in price and time after the USD's one-year appreciation. Source: Conotoxia MT5, USDIndex, Daily The chances of a slower pace of interest rate hikes may have appealed to investors on Wall Street, where the green has taken hold. Particular attention may be paid to the Dow Jones index, which is now just a few percent short of reaching new highs. Yesterday, the Dow closed more than 100 points higher, while the S&P 500 and Nasdaq rose 0.6% and 1%, respectively. For the month as a whole, Caterpillar posted the biggest gains in the 30-company index, rising more than 23 percent, while the shares of aircraft manufacturer Boeing achieved a similar result. Meanwhile, only three companies in the entire index recorded a decline. They were UnitedHealth Group, The Walt Disney Co and Salesforce.com Inc. In their case, the declines were in the range of -2.2 to -5.2%, according to data from the BBN service. Source: Conotoxia MT5, Caterpillar, Weekly Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.    

This coming Friday (25.11) is Black Friday, which is the colloquial term for the Friday after Thanksgiving in the United States. It traditionally marks the start of the pre-Christmas shopping season in the United States. Historically, it has kicked off one of the best months for retailers. However, let's examine how the markets have reacted to this time and how this year may unfold. Historical market behaviour According to data from the seasonax platform, on average for the period from 15 to 30 November for the last 37 years (since 1984), the main S&P 500 index (US500) has risen by an average of 0.64% (24 times) which would give a historical performance of as much as 63%. For the uptrend periods, the average gain was 4.44%, and the average loss was -5.55%. The maximum increase was in 2012 and amounted to approximately 15%, while the largest loss occurred in 1987 and amounted to -13%. Interestingly enough, that same year we saw the market collapse later called 'Black Monday'. Comparing this to the later period from the beginning of December to the end of the year for the same years, the index grew by an average of 3.69% (an efficiency of 64%). The average increase was 8.79% and the average loss was -5%. The maximum increase we could see was in 1991, which was 23.53%, and the largest loss of -12% was seen in 1996.  It seems that historically for the stock market this period may have been one of the best for investment. Given the data presented and the current price of the S&P 500 index at 4,000 points, we could see a change in price by the end of the year with about 64% probability to levels around 4148 points, with an average increase to around 4352 points and an average decrease around 3800 points. Source: Conotoxia MT5, US500, Weekly What can we expect in the current year? More often than not, the declines in these periods were during the year when there were financial market crises. For example, we could see falls of more than 5% in 2007 (real estate crisis), 2002 and 2003 (years after the "DOTCOM" crisis), 1986 (Black Monday gold market collapse). The best periods almost always seemed to be linked to a good performance year for the companies. We saw increases above 15% in 1999 (the year before the 'DOTCOM' crisis), 1990 (the year before the severe US drought), or 1985.  It seems that with the current situation of rising interest rates, high inflation, or falling corporate earnings, it would  be hard to expect more positive scenarios. It seems that customers this year, faced with rising borrowing costs or rising product prices, may not seem as willing to spend as much as they did in times of prosperity. Therefore, we might see little change in the index or even declines.  Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.    

The Reserve Bank of New Zealand raised the official cash rate (OCR) by 75 bps to 4.25% at its November meeting. As a result, the NZ interest rate rose to its highest level since January 2009. The RBNZ's decision was in line with market consensus. Wednesday's hike was the largest rate hike in the history of the central bank, which appears to be continuing its efforts to curb high inflation ahead of the upcoming RBNZ hiatus. The next scheduled meeting will not take place until 2023. Today's hike decision was the ninth in a row, meaning the OCR rate has risen 400 bps since October 2021, the most aggressive tightening by the RBNZ since 1999, according to tradingeconomics. RBNZ fights inflation New Zealand's central bank board said core consumer price inflation is too high, employment is above sustainable levels and short-term inflation expectations have risen. The committee signaled that more rate hikes may be on the way, assuming the OCR peaks at 5.5% in September 2023. Policymakers mentioned that they are aware that the spending decisions of many households will be largely constrained by rising debt service costs. A reduction in aggregate demand is expected to cause a temporary decline in GDP of about 1 percentage point from 2023, according to the RBNZ's statement to the interest rate decision. NZD highest since August 2022 The rate of the NZD/USD pair has been on the rise for six weeks, which seems to look like a better streak for the NZD since late 2020. This may also be due to the fact that interest rates in New Zealand may reach higher levels than in the United States. Additionally, the pace of hikes in the U.S. may already be lower, which, from an interest rate market perspective, may support the NZD exchange rate. Since the beginning of the month, the New Zealand dollar seems to have gained more than 6 percent against the US dollar. As a result, among the world's major currencies, the NZD is the strongest currency against the USD. In second place this month is the Japanese yen, with a strengthening of more than 5 percent. Source: Conotoxia MT5, NZDUSD, Weekly Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.     

Following Monday's Wall Street Journal reports of a possible increase in oil production by the OPEC cartel by 500,000 barrels per day, the price of Brent crude (XBRUSD) fell by more than 5%. When Abdulaziz bin Salman, Saudi Arabia's Minister of Energy, subsequently denied the reports, crude prices returned to pre-announcement levels. However, let's have a look at how the price of crude could evolve in relation to supply and demand. Supply in the oil market According to the aforementioned Saudi Arabian energy minister, "The current cut of 2 million barrels per day by Opec+ continues until the end of 2023 and if there is a need to take further measures by reducing production to balance supply and demand, we always remain ready to intervene." Source: Conotoxia MT5, XBRUSD, Daily Currently, according to data reported by the cartel, global supply of this commodity amounted to 100.38 million b/d, against demand of 99.32 million b/d. At the last OPEC meeting, the decision was taken to make one of the largest production cuts of 2 million b/d, which would give a production level of around 98 million b/d. Let us remember that a production shortfall could significantly affect countries heavily dependent on oil prices. An example of such a country would appear to be the United States, which is also the largest oil producer globally (currently 19 per cent of world production). To patch up the dwindling supply of this commodity, we could see the US respond by reducing its inventory levels by 5.4 million barrels among companies.  Uncertain crude demand situation Reports of a slowdown or possible recession from one of the largest consumers of the commodity, China, may be worrying. They currently account for about 15 per cent of global oil demand and have daily consumption in the region of 15 million b/d. A significant share of the consumption of this crude for China's economy appears to be industrial production, which, according to the latest PMI reading of 49.2, allows talk of a slowdown. Reports of an intensification of the fight against a pandemic in the middle country may have pushed WTI crude oil prices (XTIUSD) lower. Source: Conotoxia MT5, XTIUSD, Daily The OPEC cartel's current forecasts for global demand in 2023 average 101.82 million b/d (up 2.24 million b/d y-o-y). We may approach these with some caution as they were published ahead of reports of a possible slowdown, pandemic restrictions in China and production cuts by the cartel. The latest report will appear on 13 December, after the OPEC meeting (3 December). Possible scenarios  The market situation for this commodity points to several possible scenarios. The first would be for OPEC not to increase production and for Chinese demand to fall. In that case, for demand to equal supply, it would have to decrease in China by about 13 per cent (2 million b/d), which seems unlikely.  A second scenario could be the Wall Street Journal's description of a 500 000 b/d reduction in production and a decline in demand from China. In this case, the equalisation of demand and supply would be caused by a decline in global demand of around 1.5 per cent or in China alone of 10 per cent, which also seems unlikely.  In the latter scenario, China is coping with a recession and a coronavirus attack, causing a crude shortage of around 2 million b/d (around 2 per cent of total demand). This would give signals for an increase in its price over the coming quarters. Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.    

Since Sunday, the football World Cup in Qatar has captured the attention of fans. This could have the effect of increasing interest in football. With this in mind, let's have a look at how we could invest in sport. Could this currently be a good decision? Investment in football clubs One of the largest listed football clubs is England's Manchester United (ManUnited), currently valued at around US$2.1bn. The company has been reporting quarterly net losses since Q1 2020. What's more, its debt-to-asset ratio appears to be of concern, which was as high as 4.16 in the latest quarter (previously 2.31), the highest reading since the start of financial reporting. Currently, according to a ranking conducted by FootballDatabase, the team owned by the company is ranked 19th in the world and seventh in the country. Source: Conotoxia MT5, ManUnited, Daily The second company in terms of capitalisation is Italy's Juventus (Juventus) currently worth around USD 689 million. Since 2018, we could notice a series of net losses with it. The team is ranked 20th in the world and fourth in its league according to FootballDatabase. The last publicly listed football team is Borussia Dortmund (BiorussiaDo), valued at around USD 380 million, which is currently ranked 28th globally and 5th in the Bundesliga. Financially, it appears that this club, like its predecessors since 2020, is recording losses. Investments in specific football clubs after the outbreak of the coronavirus pandemic do not appear to be profitable. This may be due to the fact that a significant part of the football clubs' revenue comes from the sale of tickets and match tickets, which has significantly reduced their profitability during the pandemic period and forced the companies into excessive debt, and these debts may remain for years. Is bookmaking a vein of gold? During the gold rush, the biggest money was not made by prospectors of the precious metal, but by sellers of, for example, shovels and pickaxes. For this reason, let us look at businesses that could make money indirectly from the popularity of sporting events. One such example could be bookmaking companies, which offer the possibility of betting on the results of matches. The first example is the international sports betting and gambling company Entain (Entain). It includes the brands betandwin, Coral, Ladbrokes, PartyPoker and Sportingbet. The company is valued at $7.7bn and boasts revenue growth of 7% y-o-y. and earnings per share EPS growth of more than 400%, from 0.1 to 0.41. The company's business is predominantly online and has been consistently cash flow positive from operations since 2018, which seems like a good sign. Source: Conotoxia MT5, Entertain, Weekly The company 888 Holdings (888) owns several popular gambling brands and websites, including 888sport, 888casino and 888poker. Valued at $440 million, the company achieved revenue growth of 15% year-on-year. However, the low net margin of around 6.9% may seem worrying. However, the company, like its predecessor, boasts continuously positive cash inflows from its operations. Source: Conotoxia MT5, 888, Weekly Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

On Wednesday, we were able to learn about the Q3 financial report of the software giant Nvidia Corp. (Nvidia), a technology company that develops software and processors, among other things. Although the recent environment seemed unfavourable, the financial results may have positively surprised analysts. Is Nvidia's performance dependent on cryptocurrencies? Along with Intel and AMD, Nvidia is one of the top three suppliers of processors and graphics cards. It seems that one of its revenue drivers is the sale of chips, used especially in graphics cards. It could be thought that, due to their computing power, they were mainly bought by cryptocurrency 'miners' in recent years. Following recent problems and the bankruptcy of one of the largest cryptocurrency exchanges, bitcoin (BTC/USD) has seen a decline of more than 76% since its peaks. Read next: Many sued in FTX scandal, Elon Musk to reduce his time at Twitter, EU stocks edged higher on Thursday| FXMAG.COM However, Nvidia states: "We believe the recent transition in verifying Ethereum cryptocurrency transactions from proof-of-work to proof-of-stake has reduced the utility of GPUs for cryptocurrency mining." This category, according to the report, makes up around 1.2% of revenue, illustrating how small this segment is for the company. Source: Conotoxia MT5, BTCUSD, Weekly The company's Q3 revenue was US$5.93 billion (US$5.77 billion was expected), down y-o-y. by 22%. Cloud computing power sales service accounted for as much as 65% of the company's revenue and sales. This increased by 29% year-on-year. In second place was revenue from the gaming sector, accounting for 26% of revenue, but recording a decline of 51%, which appears to be the aftermath of the pandemic. With this data, we could say that Nvidia's performance does not appear to be linked to risks in the cryptocurrency market. An additional argument in favour of the independence of these assets is their correlation, which stands at 0.55 since the beginning of the year, which may indicate their low level of dependence. Earnings per share EPS for the period came in at US$0.58, below analysts' expectations (US$0.69 was expected). The company's gross margin was also negative, falling to 53.6% (previously 65.2%), which the company attributed to increased chip inventory due to falling demand in China. Maribel Lopez, principal analyst at Lopez Maribel comments: “...there is a long tail of AI workloads which will create a return to growth, but it may take several quarters ”. “The issue for Nvidia is the short term, the next several quarters will be rough. Investors will have to take a longer view, similar to what’s required with Intel." - Lopez said. What does Wall Street think of Nvidia shares? Source: Conotoxia MT5, NVDIA, Daily According to Market Screener, the company has 40 recommendations, with 'buy' opinions prevailing. The average target price is set at USD 200.93, 26% higher than the last closing price. The lowest target price is at USD 320 and the highest is USD 110. Author: Grzegorz Dróżdż, a Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

On Monday, we saw the 13F report published by Warren Buffett's fund (a report on assets filed by investment fund managers). In it, we got to know the new companies that the American billionaire's fund has bought for its portfolio. This investor has recently taken a particularly cautious approach to investing. Is this information a sign to make purchases? Warren Buffett's current portfolio Buffett, regarded as one of the world's top investors, has seemed reluctant to make new purchases in recent years. Currently, his securities are valued at USD 296 billion, with Apple (Apple) shares being the largest item in his portfolio, accounting for a staggering 42% of the portfolio value. In second place are Bank of America (BankofUS) shares, accounting for 10%, and in last place on the podium are Chevron Corp (Chevron) shares, accounting for 8% of the portfolio value. As you could see, Buffett is not the biggest fan of diversification. His investment portfolio currently consists of 49 (mainly US) publicly listed companies, but the top 5 positions account for as much as 74.5%. The current financial crisis does not seem to have had a significant impact on the billionaire's investments. Since the October lows on the stock markets, the value of Bekrshire Hathaway (BerkshireHa) shares has risen by more than 18%, compared to 13% against the S&P 500 index (US500). Source: Conotoxia MT5, BerkshireHa, Daily Berkshire Hathaway's new purchases in Q3 this year. The most surprising new purchase appears to be shares in one of the world's largest semiconductor manufacturers, Taiwan Semiconductor Manufacturing (TaiwanSemic). This company manufactures, tests and sells integrated circuits. Interestingly, one of its significant customers is Apple, Buffett's largest investment position. Does this mean a redirection of capital by the fund to the East? The company currently accounts for 1.4% of the value of his portfolio. Source: Conotoxia MT5, TaiwanSemic, Daily The second newcomer is Jefferies Financial Group (Jefferies) a US multinational independent investment bank and financial services company. Which, when purchased, represents only 0.05% of the portfolio and is one of the smallest positions in the fund. However, it appears to be a stable company with positive operating profits. Source: Conotoxia MT5, Jefferies, Daily Buffett increased investments in, among others: Occidental Petroleum Corporation (OcPetroleum) - by 22%, Paramount Global (Paramount) - by 16%, Chevron Corp. (Chevron) - by 2% and RH Common Stock (Rh) - by 8%. We could also learn from the 13F report that it has reduced its position in 6 companies, and closed completely one of them from the real estate sector STORE Capital Corp (STORE). Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.    

Germany's largest index, the Dax (DE40), has risen by more than 20 percent since its recent lows. It seems that this may have been influenced by, among other things, falling commodity prices, particularly for natural gas, which, according to IMF data, has fallen by more than 21 percent since its peaks. Could this signal the start of a change in trend or just a rebound from a bottom? Inflation key to the German economy According to the President of the Federal Statistical Office of Germany: “The inflation rate in Germany - measured as the change in the consumer price index (CPI) compared to the same month of the previous year - was +10.4 % in October 2022. The inflation rate has thus increased again after +10.0 % in September 2022. The main causes for the high inflation continue to be enormous price increases for energy products. But we are also increasingly observing price increases for many other goods and services. Rising food prices are now particularly noticeable for private households.” Today's data from the ZEW Economic Indicator, which rose by 22.5 points to -36.7 in November (values below 0 points indicate a deterioration in the situation), thus beating some of the best forecasts (-50 points were expected), seems to have warmed the climate. As the institute's commentary states: "The latest reading suggested the economic outlook for Germany has improved significantly compared to October, likely due to hopes that inflation rates would fall soon and policymakers would not have to tighten monetary policy as hard and/or for as long as feared. About 50.8 percent of the surveyed analysts predicted a deterioration in economic activity over the coming months, while 14.1 percent of them expected it to get better and 35.1 percent expected no changes.” Additionally, as Investing.com analyst Geoffrey Smith notes: “The benchmark DAX index rose nearly 1% on Monday after the European Commission gave Berlin permission to nationalize a former unit of Russian gas monopoly Gazprom, bolstering the efforts of Europe's largest economy to restore order to its energy market after the chaos caused by Russia's war in Ukraine.”  Source: MT5, DE40, Daily EUR/USD a forecast for change for the European market? The cumulative data suggesting a possible improvement in the European market situation seems to have coincided with increases in the EUR/USD pair, which has risen by more than 6 per cent since its recent lows. This may be a reason for global investors to switch to an improving economic situation in the European market, expectations of falling inflation, or even the valuation of the end of the conflict in Ukraine. However, it seems that until we see the first declines in euro area interest rates, confirmation of a change in trend may seem doubtful. Source: MT5, EURUSD, Daily   Author: Grzegorz Dróżdż, a Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

Recent data on the decline in U.S. inflation from 8.2 percent to 7.7 percent may have reversed investor expectations. It seems that the Fed's announcement to fight by all means against inflation did not scare investors. In that case, have we already seen the peak of price increases, and if so, can we profit from it and how? Bonds as an investment in rising inflation A bond is a type of debt issued by companies and countries that could be traded on the market. By its structure it is largely linked to the level of interest rates. Currently, interest rates (lending rates) are raised to beat inflation, which leads to a drop in bond prices and increases in their yields. In addition, the longer the term to maturity, the greater the risk of interest rate changes. Bond ETFs a hedge against the crisis? After the last FOMC meeting, rates were raised by 0.75 percentage points, the largest increase in the entire cycle, which started at 0.25%, now reaching 4.00%. Assuming that we would see a change in the Fed's monetary policy and cut interest rates to, say, 1.5%, in order to bail out the economy, what kind of returns would we get for the sample funds? The iShares Core U.S. Aggregate Bond ETF (AGG) is a fund that gives broad exposure to U.S. bonds rated BBB or higher (considered very safe). It holds as much as 74.43 percent of bonds with the highest AAA rating, and has an average Effective Duration of 6.41. This ratio takes into account interest paid (coupons) and is an approximation of price changes. For example, if the level of interest rates were to fall to the level described (a change of 2.5 percentage points), the price of the bond would rise by about 16 percent. Because of the current rate hikes, this fund has not fared well, crediting a decline in value of more than 14 percent since the beginning of the year (the S&P 500 index has fallen 16.42 percent over the same period). Source: MT5, AGG, Weekly The second fund is the Vanguard Intermediate-Term Bond Index Fund (BIV), which holds 58 percent of U.S. government bonds with maturities between 5 and 10 years. The average effective maturity for this fund is 6.01, which would give an increase in value for the described example of about 15 percent. The performance of this fund since the beginning of the year has been similar to the one previously discussed (down 14.74 percent), but in comparison this ETF seems to have a slightly lower risk. Source: MT5, BIV, Weekly The last fund is the iShares 20+ Year Treasury Bond ETF (TLT), which consists of U.S. government bonds with maturities of more than 20 years. The average effective maturity is 17.66. For the described example of a 2.5 percentage point drop in interest rates, the fund could rise in value by about 44 percent. Since the beginning of the year, the fund's value has fallen by more than 30 percent. Source: MT5, TLT, Weekly What's next for inflation? In order to answer the question "what can affect the decline of inflation?", we should define what is currently causing it. There are many factors that could affect the level of inflation in a country, including demand, or commodity prices. Currently, it seems that it is the latter factor that has the greatest impact on the level of inflation, but over the past months we have noticed significant declines in commodity prices, including oil prices have fallen by more than 30% since their peaks.   Author: Grzegorz Dróżdż, a Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

After Elon Musk took over Twitter, along with delisting the company's shares (delisting), he introduced an option to buy confirming account authentication with the Twitter Blue stamp for $8. As it turned out, this feature was used against US pharmaceutical company Eli Lilly (EliLilly), whose market value fell by nearly $20 billion. The situation on the Twitter platform In a post dated Friday, November 11, the impersonators wrote: "We are excited to announce insulin is free now." After the incident, ELI Lilly's share price fell by more than 5 percent. Only by the end of the day we could already read the following Tweet on the company's official profile: "We apologize to those who have been served a misleading message from a fake Lilly account. Our official Twitter account is @LillyPad."It seems that such events, where an asset rose or fell significantly after a Twitter post, we might have associated more with the cryptocurrency market or the tweets of Elon Musk himself. Interestingly, a similar event befell defense and aerospace company giant Lockheed Martin (Lockheed) on the same day. Source: MT5, Lockheed, Daily A bargain in the market, or a legitimate discount? The manufacturer of, among other things, insulin, or a vaccine for polio disease, which has been in existence since 1876, boasts Q3 revenues for this year of $29.24 billion, an increase y/y. of 2.5 percent, and operating profit (EBIT) of $7.2 billion (down 10.85 percent y/y). However, the company boasts a very good profitability (ROE) of 64 percent. According to Statista, the average profitability for the drug manufacturer sector in 2022 is 16.97 percent. This gives us a result more than 47 percentage points above the industry average. In addition, the company appears to classify itself as a passive company paying a regular dividend, which averages 1 percent of the share price per quarter.The current macroeconomic situation does not seem to have a negative impact on the company's stock price, whose shares have risen from a price of about $270 to $352 (30% YTD) since the beginning of the year. The annual risk for this company, as measured by standard deviation, was 28.04 percent, where it was 24.61 percent for the main S&P 500 index (US500) during the period. The maximum decline from local peaks (Drowdown) was 13.63 percent, compared to 25 percent for the S&P 500.In addition, the company's shares appear to present a correlation to the broad market of 0.48, which we could interpret that the company is moderately dependent on the market situation. What does Wall Street think of Eli Lilly's stock price? According to Market Screener, the company has 23 recommendations, most of which are buy recommendations. The average target price is set at $364.29, more than 3 percent higher than the last closing price. The highest target price is at $441, and the lowest is $202.Given the current situation, which seems to have no impact on the company's operations. The overvaluation of the stock after the entry from the fake account seems to be a signal for the price to return to pre-decline levels. Source: MT5, EliLilly, WeeklyAuthor: Grzegorz Dróżdż, a Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

The end of last week brought a strong turnaround in the US dollar following the release of inflation data from the US. The annual inflation rate in the US slowed to 7.7% in October, the lowest since January. The consensus was for a reading of 8%. Following the publication, the EUR/USD exchange rate hit its highest since August 2022. In the United States, energy costs rose 17.6%. The slowdown was also seen in food (10.9% vs. 11.2% in September) and used cars and trucks (2% vs. 7.2%). Compared to the previous month, the CPI rose 0.4%, below expectations of 0.6%, tradingeconomics calculated. At the same time, the cost of medical services pushed the CPI down. Nonetheless, the data could still point to strong inflationary pressures and broad price increases across the economy, mainly in the services sector, while commodity prices benefited from some improvements in supply chains, according to data released Friday. As a result, the dollar index lost about 4% last week, as the lower inflation reading seemed to strengthen the case for a less aggressive tightening path from the Fed. Investors are betting that the U.S. central bank would limit the size of rate hikes to 50 basis points from December, after a series of 75 basis points over the past four meetings. Source: Conotoxia MT5, USDIndex, Daily Dollar exchange rate at the start of the week The dollar index rose toward 107 points on Monday, recovering slightly from near three-month lows after Federal Reserve Chairman Christopher Waller warned investors against too much optimism over a single inflation report and said the central bank "still has a long way to go" with interest rate hikes. Waller acknowledged that the Fed may slow the pace of interest rate hikes at upcoming meetings, but stressed that markets should focus on the final level, which is possibly still "a long way off," rather than the pace of any move, tradingeconomics reported. Meanwhile, Boston Federal Reserve President Susan Collins said Friday that she believes the Fed will continue to raise interest rates at upcoming FOMC meetings. The next FOMC meeting is scheduled for December 14. Commenting on the latest inflation data for October, Collins said it is still too early to determine the peak of the Fed's rate cycle. However, she noted that the risk of excessive tightening has increased, BBN reported. Cryptogeddon continues On Monday morning, bitcoin cost less than $16,000, approaching a two-year low. This marks a drop of nearly 80 percent from last year's peak, bringing the current correction on BTC closer to similar percentage levels as after 2012 and 2016. (then BTC corrected by 86 and 83 percent from its peak). The FTX exchange has officially filed for bankruptcy, which may also involve problems for its affiliated companies (130 entities are in question) and its investors. Within days, FTX, one of the world's largest cryptocurrency exchanges, collapsed after concerns about its financial situation triggered a "run on the bank" and a wave of withdrawals from the exchange. It turned out that the exchange couldn't withdraw all of its customers' funds because it didn't have any. Fears of insolvency intensified after Binance abandoned its plan to acquire FTX. On top of that, Sam Bankman-Fried allegedly used customer funds to support the exchange's sister company, Alameda Research. Additionally, top-level employees of both FTX and Alameda are said to be looking for a way to leave the United States or are already outside the U.S., The target is said to be countries without an extradition treaty with the United States. In just one week, the price of bitcoin fell by 23 percent, ETH by nearly 25 percent, Solana took a dive of nearly 60 percent, and the Binance exchange token fell by 20 percent. The bitcoin cash seemed to lose the least during this time with a drop of 15 percent. Source: Conotoxia MT5, BTCUSD, Weekly Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

As we slowly approach the end of the results season, we found ourselves with elections for the Senate and House of Representatives in the United States, after which we would find out whether Joe Biden's party would retain its majority in those chambers. In addition, we encountered a slump in the cryptocurrency market caused by the problems of the FTX exchange. Macroeconomic data This week it seems that we were able to relax relatively after last week's FOMC decision to raise interest rates in the United States and the announced use of all means by the Fed to choke off inflation. On Wednesday, we learned of the change in U.S. crude oil inventories, which rose by 3.25 million barrels (1.36 million barrels were expected) compared to the last period, in which they declined by 3.115 million barrels. We learned the results of the CPI inflation rate, which amounted to 7.7% y/y. (forecast 8 percent y/y). It seems that inflation surprises for another month in a row, falling, which could be perceived as a positive signal for the markets. Elections for the Senate and House of Representatives in the United States were held on Tuesday. The vote counting is still underway, but Republicans are in the lead in both chambers. Stock market On Monday, we were able to learn the results of gaming giants Activision Blizzard (Blizzard) and Take-Two (TakeTwo), among others. The former surprised positively, reporting earnings per share EPS of 0.68 (forecast 0.51). The second posted a loss per share EPS of -1.54 (forecast 1.38), in addition to reporting lower revenue than expected. Source: MT5, Blizzard, Daily On Tuesday, we learned the results of media giant Walt Disney (Disney), which reported a decline in earnings per share EPS to 0.3 (forecast 0.59). It seems that the entertainment industry is not doing well, which could support the thesis of the current economic slowdown. Today we were also able to learn how the medical industry has performed recently. Among other things, we learned about reports from the maker of medications and vaccines AstraZeneca (AstraZeneca), which showed earnings per share more than doubled relative to expectations. Medical instrument and machine manufacturer Becton Dickinson (BDickinson) showed earnings per share of 1.99, in line with expectations, on increased revenues. Elon Musk appears to be having problems with his workforce after taking over Twitter. After massive layoffs at the company, we could learn from the media about mistakes in this aspect and the dismissal of valuable employees, whom the billionaire seems to be trying to recruit back. Currency and cryptocurrency market After the publication of inflation from the US, the EUR/USD exchange rate broke out above parity and reached around 1.016 at its peak. It seems that the market needs to update its valuation when it comes to the announced US interest rate hikes, which may put pressure on the USD. Source: MT5, EURUSD, Daily Blood has been shed in the cryptocurrency market. After the largest crypto exchange Binance announced the sale of the FTT token (FTTUSD.p) belonging to the third largest FTX exchange, the price of the cryptocurrency fell from $26 to $2.7 (89 percent). This situation revealed the problems behind this exchange. This seems to have led to a massive outflow of capital from the virtual money market, as we could see from the largest of them. Bitcoin fell by more than 20 percent during this period, and the price of the second largest cryptocurrency ETH fell by about 28 percent. Source: MT5, FTTUSD.p, Daily What's in store for us next week? On Monday we would learn the GDP reading in the Cherry Blossom country. The current quarter-on-quarter forecast is for growth of 0.3 percent (previously 0.9 percent). China's reported year-on-year change in industrial production may seem key. The forecast, according to analysts, is for an increase of 5.2 percent (previously 6.3 percent). On Tuesday, we'll learn the results of Germany's ZEW economic sentiment index, which recently reached -59.2 points, where values below zero signify deteriorating economic conditions. On Thursday, we would find out how much inflation in the Eurozone was (forecast at 10.7 percent). Among the key Q3 earnings reports it seems we could count Monday's results from the largest retailer in the United States, Walmart (Walmart). On Tuesday, graphics card giant Nvidia (Nvidia) would present its report, along with one of the largest digital communications technology conglomerates Cisco (Cisco).Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

ETF (exchange-traded fund) a type of passive fund that is designed to reflect the behavior of specific indices, or sectors. With this, we can achieve exposure to a particular market, sector or country while keeping costs low. Thanks to this, we don't have to buy, for example, all 500 companies in the S&P 500 index. So we decided to check which of these funds could achieve the most interesting results in the last 3 months. Fund performance Of the 200 funds surveyed, 24 percent had a positive return. The average volatility of the fund, measured by standard deviation, during the period was 15.12 percent. The largest index, the S&P 500, fell 7.17 percent during the period, reaching a volatility of 12.24 percent. It seems that based on this information, we can see the current moment of the business cycle. The best of the best If we wanted to juxtapose the best winners, we could compare their rates of return. However, it seems that such a comparison does not take into account the risk aspect of a given investment. For this purpose, we will use the Sharpe ratio, that is, the relationship of the achieved rate of return to the level of total risk (standard deviation), to measure the effectiveness of the investment. For this indicator, it is assumed that values above 50% are considered to be an outperformance of the market average over a long period.The iShares MSCI Turkey ETF (TUR) had the highest return, at 47.68 percent over the past quarter. The fund is designed to seek to track the investment performance of a broad index composed of Turkish stocks. It consists of 27.16 percent Turkish industrial companies and 19.47 percent material processing companies. The result of significant growth may have been influenced by rising inflation, which currently stands at, as much as 85.51 percent. Despite such a high decline in the value of the Turkish lira, the dollar-denominated ETF achieved such a result. Sharp for the period was 220.46 percent. Source: MT5, TUR, WeeklyThe second best return was achieved by the VanEck Oil Services ETF (OIH). The fund is designed to track the overall performance of companies listed in the United States and engaged in upstream oil services, which include oil equipment, oil services or drilling. Consisting of 25 companies, the fund's performance in the most recent quarter was 44.67 percent, with the Sharpe ratio at 185.51 percent. It appears that such strong performance may have been due to the oil market.In the final podium spot was the Invesco Energy S&P US Select Sector UCITS ETF (XLES), which, like its predecessor, mimics the performance of the US energy sector. This fund consisting of companies from the S&P 500 (US500) index, unlike its predecessor, is geared only towards energy companies. During the period under review, it achieved a performance of 29.77 percent with a Sharpe ratio of 182.51 percent. The result also seems to have been influenced by the price of oil The safest Among the funds with positive returns and the lowest volatility was the Xtrackers MSCI Japan UCITS ETF (XMUJ). A fund that gives exposure to key Japanese companies that hold a minimum of 85 percent of a given market. In addition, this dollar-denominated fund hedges against changes in the dollar-Japanese yen (USD/JPY) exchange rate. Volatility during the quarter under review was only 6.05 percent, and the fund was up 1.15 percent despite fluctuations in Japan's main NIKKEI 225 (JP225) index. The Sharpe ratio was 18.99 percent during the period under review. Source: MT5, XMUJ, DailyThe iShares MSCI India UCITS ETF (NDIA), which seems to have been growing rapidly for years, came in second with exposure to the Indian economy. What may seem interesting is that it is 24.73 percent composed of companies in the financial industry. In second place in terms of weight are companies from the information technology industry accounting for 15.02 percent of the fund. The volatility for the stated period was 8.09 percent with a performance of 3.47 percent. This gives a performance-to-volatility ratio (Sharpe's) of 42.89 percent.Specially highlighted ones include the AXS First Priority CLO Bond ETF (AAA), which boasts a volatility of just 0.91 percent despite a -0.98 percent drop in value. Sharp Under normal circumstances, this fund invests at least 80 percent of its assets in AAA-rated tranches of top-priority debt backed by credit obligations. This fund can invest in bonds of any maturity. In addition, this fund is actively managed and does not seek to mimic the performance of any particular index. Most independent When we want to reduce portfolio risk, according to portfolio theory, we should look for asset classes that are least correlated with each other. We usually measure the level of dependence by the correlation level of two assets, where a correlation value of 1 means perfectly correlated assets, a value of -1 perfectly opposite correlated (when one goes up, the other goes down exactly the same amount), and a value of 0 means no dependence at all.The lowest dependency ratio relative to the largest S&P 500 index (US500) was demonstrated by the United States Oil Fund, LP (USO), which seeks to reflect changes in the price of oil by investing in futures contracts on this commodity with various maturities. After a period of three months, the fund achieved a return of 6.02 percent with a risk of 18.87 percent. The correlation index (correlation) was 0.24, which may indicate a low correlation to the broad market. The Sharpe for this fund was 31.93 percent. Source: MT5, USO, DailyAuthor: Grzegorz Dróżdż, a Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

This year the word inflation may be considered the word of the year. It looks like it might not lose its popularity as the year comes to an end, and still, the phenomenon of rising prices in the economy may arouse great interest. Today we will learn the inflation rate for the United States, on which further decisions of the Federal Reserve on interest rates may depend. The above decisions may in turn affect the behavior of the U.S. dollar, stock market indices or commodities. According to the tradingeconomics website, the annual inflation rate in the US may retreat to 8% in October from the 8.2% recorded the previous month. Core inflation is also possible to fall to 6.5% from a 40-year peak of 6.6%, according to market consensus. At the same time, it seems expected that the monthly inflation rate could accelerate to 0.6% in October from 0.4% in September, as gasoline prices rose for the first time in four months. U.S. inflation was recorded at 8.2% in September, the lowest in seven months, compared to 8.3% in August. What are Fed officials saying? U.S. Federal Reserve Bank of Richmond President Tom Barkin shared on Wednesday that if the central bank decided to retreat due to "fear of a slowdown, inflation would come back even stronger." Barkin stressed that while the Fed's current monetary policy path could lead to a slowdown, as the central bank aims to bring "supply and demand back into balance" and pull inflation down to 2%, BBN reported. Meanwhile, Federal Reserve Bank of Minneapolis President Neel Kashkari said discussion of a pivot in current Fed monetary policy is "completely premature." He said that the central bank's dual mandate of keeping inflation at 2% and maximizing employment will encounter problems "at some point," but that moment is "very far away." Kashkari stressed that wages are not driving inflation, but rather trying to catch up with it. He expressed regret that the Fed did not start raising interest rates earlier, but noted that inflation will continue to be high due to external factors, according to the BBN release. Dollar exchange rate ahead of inflation data Source: Conotoxia MT5, EURUSD, Daily The EUR/USD pair's exchange rate seems to be consolidating at the 1.0000 level ahead of the release of US inflation data. This could be a potential resistance level, the overcoming of which could lead to a possible appreciation of the euro towards 1.0300. However, for this to happen, it is possible that the inflation data would have to be slightly weaker than market expectations. Meanwhile, potential support could be in the region of 0.9750. The inflation data will be published today at 14:30 GMT+1. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Within the next few days we should receive the results of the elections for the House of Representatives and the changes in 35 of the 100 seats in the Senate. So far, the current Democratic majority seems to have given a lot of leeway to incumbent President Biden. Therefore, what changes in voting strength can we expect, and how might these changes affect financial markets? The course of the results Recall the scope of powers of the two chambers in the US system. The House of Representatives (a.k.a. the Lower House), consisting of 435 representatives, is tasked with, among other things, passing federal legislation (laws), initiating all legislation, and electing the President of the United States. The Senate (Upper House) is tasked with providing advice and consent under the U.S. Constitution. Therefore, the Senate could , for example, block laws and give its interpretations of the Constitution. So far, it seems that at the moment of legislative and executive concurrence, this has given the President and the Diet freedom to make policy, but in the event of a difference of opinion between these institutions, it seems that we could see restrictions on action.At the moment we can see an advantage in the House of Representatives in favor of the Republicans (currently 199 seats to 172 for the Democrats), and in the vote for the Senate we have almost equal results (Democrats 46, Republicans 47). In the event of a Republican win in both chambers, the Democrats would lose their majority, which could lead to the separation of powers of Joe Biden's government.What may seem interesting is, according to NBC News exit poll data, when asked, "Which issue mattered most in deciding how you voted today?" respondents most often marked abortion (45 percent), followed by inflation (29 percent). This may give additional insight into the problems of the average American, and put pressure on the current government especially on inflation. Silence before the storm? We may see reduced volatility in the markets today. The S&P 500 Index (US500), after last week's seemingly extremely negative news from the Fed chairman about continued interest rate hikes, fell more than 3 percent before recovering to around 3800 points.It seems that a potential win by the Democrats would deepen efforts to fight inflation through government programs and raising interest rates. This could have a negative impact on markets. Regardless of the election results, however, volatility in major markets could increase. Source: MT5, US500, WeeklyAuthor: Grzegorz Dróżdż, a Market Analyst of Conotoxia Ltd. (Conotoxia investment service)Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

The year 2022 will probably go down in history as the year that saw unprecedented collapses in the cryptocurrency world. The current and previous events could only be compared to the bursting of the dot-com bubble, the collapse of Lehman Brothers and the Great Financial Crisis. The only difference is that all this happened within a few months in the cryptocurrency market. After the collapse of the Terra ecosystem, the nail in the coffin of which may have been Anchor-based deposits bearing interest at 20% per year, the market now faces the collapse of one of the largest cryptocurrency exchanges in the world - FTX. Here, in turn, the collapse mechanism was said to be related to the exchange's native token, or FTT, which was created by the exchange and then used as collateral for transactions made by FTX's subsidiary, Alameda Research. A decline in the value of FTT threatened Alameda insolvency. This in fact happened with the owner of Binance, which announced its intention to sell FTT tokens worth more than half a billion dollars. Users of the FTX exchange were expected to throw themselves into withdrawals, as Reuters reported talk of $6 billion in 72 hours. Thus, a typical "run on the bank" appeared, which no financial institution would have been able to survive, and in addition, FTT was losing value, and Alameda, which, no longer had adequate collateral, could be forced to liquidate other tokens, which could lead to a collapse in the broad cryptocurrency market. Source: Conotoxia MT5, BTCUSD, Daily Crypto always works It is worth mentioning that the cryptocurrency market has no price limits or circuit breakers, no levels at which assets are suspended, no capital controls or the introduction of withdrawal limits, as in the case of ATMs. Here everything happens instantly on the free market. The dynamics of events can be powerful. The owner of Binance was also able to take advantage of this to acquire FTX. He basically took down one of the major exchanges in two days, but only because the exchange was doing little transparent business with Alameda, which could be brutally verified. Binance, first after announcing its intention to sell FTT, triggered an avalanche and the collapse of FTX, only to end up issuing a letter of intent, which may indicate a desire to acquire the US exchange. The amount, however, was not disclosed. Source: Conotoxia MT5, BNBUSD, Daily Volatility in the cryptocurrency market is back We recently mentioned that volatility in the cryptocurrency market fell to its lowest level in two years. It was lower than the volatility for the traditional currency market, stock market or bond market. Now it seems to be rising, at first glance by a negative event in the crypto world, but in the long term, this market may clear itself of inefficient players, which could be positive for it as a result. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

One of the largest export products of the U.S. economy is capital goods, which, according to Trading Economics, accounts for as much as 19% of exports. Wanting to gain exposure to this particular sector of the market, we looked at a fund that we could use to do so. ETF: Financial Select Sector SPDR Fund As we can learn from the prospectus of the passive composition of the Financial Select Sector SPDR Fund (XLF), it is designed to   reflect the performance of the financial and peri-financial sector through holdings in the largest players in this market. From the fund's prospectus, we learn that the fund is designed to reflect the behaviour of an index: “The index seeks to effectively represent the financial sector of the S&P 500 index. - It seeks to provide accurate exposure to companies engaged in: diversified financial services;  Insurance;  banks;  capital markets, investment trusts,  mortgage real estate ("REIT"); consumer finance; and credit institutions and mortgage finance”. Banks have the largest share by industry in XLF, accounting for 33.69% of exposure. In second place are companies in the capital markets sector, accounting for 27%, and the third-largest share is insurance companies (20.1%). The entire fund consists of 66 companies, of which the largest 5 companies in terms of share size account for as much as 38.86% of the fund's portfolio value. This could pose a potential risk of making the fund's performance dependent on the largest players. The fund currently has $31.5 billion under management and has achieved an average annual return from the perspective of the last 10 years of 11.24%, including a paid annual profit distribution (dividend) of 2.44%. The fund's average risk, as measured by the level of volatility (standard deviation), was 26.01% per year, relative to the broad market, where it was 24.78%. In addition, the correlation to the S&P 500 index (US500) was 0.93. Such a high correlation may be due to the significant share of banks in the S&P 500 index. Source: Conotoxia MT5, XLF, Weekly. Financial sector outlook Now in an era of monetary tightening with the Fed raising interest rates, which have risen from 0.25% to, as much as, 4% since the beginning of the year, it seems that banking sector earnings could positively affect its valuation. Rising interest costs seem to have a direct impact on the banking sector's earnings growth, as we have seen from the recent performance period. However, since the beginning of the year, the fund's value has fallen by 16.8% (versus an 18.08% loss for the broad market index). In addition, the announcement of further interest rate hikes may have a positive impact on the valuation of the banking sector in the long term.   Author: Grzegorz Dróżdż, a Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The cryptocurrency market seemed to be characterized by more stability recently. Volatility in the price of bitcoin fell to its lowest level in 2 years. It was even lower than the volatility in the traditional currency market, the stock market and even bonds. However, the cryptocurrency market may be knocked out of balance by concerns about the FTX exchange. Twitter, which Elon Musk has taken over, has become a platform for exchanges between three important people in the cryptocurrency market. Sam Bankman-Fried is the CEO of the FTX exchange, Changpeng Zhao is the CEO of Binance, and Caroline Ellison is the head of Alamada Research, a subsidiary of the FTX exchange. Alamada is a trading company that manages more than $1 billion in digital assets and trades between $1 billion and $10 billion a day across thousands of major tokens, altcoins and their derivatives. Alameda Research holds about forty cryptocurrencies, according to data as of the end of April. Source: Conotoxia MT5, FTT, Daily What's happening in the cryptocurrency market? Over the weekend, rumors began to surface about the insolvency of the FTX cryptocurrency exchange. As a result, its owner began to assure in his Twitter posts that customers' funds are safe, and the exchange can withdraw all of them to its customers without any problems. Bankman-Fried added that the exchange does not invest its customers' funds and processes all withdrawals. The rumors may have emerged after CoinDesk published a story last week revealing that the balance sheet of FTX's sister company, Alameda Research, consisted of FTT (FTX's native token) on the exchange.  This may have led to a public war of words between Alameda CEO Caroline Ellison and Binance CEO Changpeng Zhao, also the owner of a significant number of FTT tokens, as Binance's CEO, CoinDesk notes. FTT liquidated by Binance? According to Zhao, "as part of Binance's exit from FTX Capital since last year, Binance received approximately the equivalent of $2.1 billion in cash (BUSD and FTT). Due to recent revelations that have come to light, we have decided to liquidate any remaining FTT on our books." This could have led to a collapse in the price of the FTT token, which fell by more than 20 percent, and could also lead to a collapse in the prices of other cryptocurrencies. Ellison responded to Zhao's words by saying that Alameda would be ready to buy any amount of FTT that Binanace was willing to sell for $22. However, Binance's CEO countered that it would remain on the free market and liquidate FTT there. Source: Conotoxia MT5, BNB, Daily After the collapse of the Terra ecosystem, another unfavorable high-level thread seems to be emerging in the cryptocurrency world. The insolvency of exchanges is a topic widely discussed on social media. Some in the community may fear a repeat of the events of many years ago and the story of Canadian exchange QuadrigaCX, only on a much larger scale. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The OPEC cartel's recent decision to cut oil production was met with a response from U.S. President Joe Biden, who called an emergency conference call on October 31 following the cartel's decision. To this, he announced significant steps to beat the price, describing the oil companies with the following words: "Their profits are a windfall of war – the windfall from the brutal conflict that’s ravaging Ukraine and hurting tens of millions of people around the globe" Situation in the US oil market Since President Biden's statement, the price of WTI crude oil (XTIUSD) on the markets has risen more than 16% to $92 per barrel. Recall, however, that the United States is currently the number one producer in the oil market. According to the latest data from the EIA (Energy Information Administration), production stands at 11.975 million barrels per day (11.9% of global output). These are levels from November 2019, when the price per barrel was in the neighbourhood of $55. Will Biden succeed in forcing companies to increase production? On Wednesday, we will learn the results of the change in oil inventories in the United States. Last week, they decreased by 3.115 million barrels (0.45 million barrels per day). If this trend continues, it  could  be assumed that the US government's actions have yielded the first results. However, the amount of inventories seems to be presented negatively. According to the EIA's data, they currently stand at 836.62 million barrels, down 29% from their July 2020 peak. If the current trend of inventory consumption continues, the stockpile would run out in 5 years; if it doubles, we could see shortages after just 2.5 years. Will OPEC lead to a global recession? According to data provided by OPEC, in Q3 2022 global supply was 100.63 million barrels per day, and the cartel itself, which consists of 13 countries mainly in the Middle East, amounted to 29.45 million barrels per day (28% of global output). Demand at the time was 99.33 million barrels per day. It is expected that demand may remain at a similar level. The cartel's announcement may indicate a desire to reduce production by more than 2 million barrels per day. This could create a shortage in the world market of about 2%, in which case it seems that we could expect price increases in this market. To cover the described shortfall, the Biden government would have to increase production by 16%, or increase supply to levels of about 14 million barrels per week. Both scenarios and their mixes may prove unlikely. Oil prices, and fuel prices at that, appear to have a significant impact on inflation. As a result, the U.S. presidential government may do all it can to limit the risk of further price increases. Information that could lead to a reduction in demand in the global market in recent days is a declaration by the Chinese government, which has reaffirmed its commitment to pursuing a zero-Covid policy. This could lead to a reduction in demand from one of the world's largest importers of the commodity. What does Wall Street think about the oil market? The EIA Institute gives a target price for 2023 in the vicinity of $95/bbl. However, a consensus of analysts reported by Trading Economics indicates a price of $108.71/bbl in 12 months. An additional perspective was indicated by UBS bank analyst Giovanni Staunovo on OPEC's production cuts: "The cut suggests that there is a desire to defend oil prices to stay above the level of $90 per barrel". Source: MT5, XTIUSD, Daily How to find CFDs on oil? At Conotoxia, you can choose from CFDs for commodities and precious metals. Wanting to find an XTIUSD CFD, for example, you just need to follow 4 simple steps: To access Trading Universe - a state-of-the-art center of financial, information, investment and social products and services with a single Smart account, register here. Click "Platforms" in the "Invest&Forex" section. Choose one of the accounts: demo or real. On the MT5 platform, search for the CFD of your choice and drag it to the chart window. Use the one-click trading option or open a new order with the right mouse button. Grzegorz Dróżdż, Junior Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced, or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The end of the first week of November saw above-average volatility in the financial markets, possibly related to rumors about the lifting of China's anti-Covid policy. China's economy seems to be suffocated by restrictions, and the lifting of the zero Covid policy could lead to faster growth in China. EUR/USD exchange rate The financial market seemed to react with euphoria to this rumor, which could lead to a weakening of the USD against the Chinese yuan in particular, as well as to increases in the EUR/USD exchange rate. As a result of the weakening dollar, we could also see commodity prices rise, including silver, which jumped more than 6 percent, surpassing $20 per ounce. China, however, dismissed the aforementioned rumor over the weekend, leaving its restrictive approach to the outbreak. This, however, seems to have failed to change the positive sentiment. Source: Conotoxia MT5, EUR/USD, Daily The euro approached parity with the US dollar, extending the gains above the $0.99 level. This may also be related to expectations that the European Central Bank  would  further tighten monetary policy to counter high inflation. Last week, President Lagarde said the bank should continue to raise interest rates even as the likelihood of a recession in the eurozone increased. Recent data showed that inflation accelerated to a new record of 10.7 percent in October. The rise in inflation, the data showed, is being driven by energy and food prices. At the same time, GDP growth in the region slowed to 0.2 percent in the July-September period. This was the weakest growth in six quarters.  Statements important for the euro exchange rate Bank of France Governor Francois Villeroy de Galhau said Monday that peak inflation in the eurozone should be reached in the first half of 2023. The impact of the energy crisis on overall price growth "will fade starting probably next spring," he - A member of the European Central Bank's Governing Council, quoted by the BBN website, told The Irish Times. He also called for interest rate hikes to continue until it is clear that core inflation has peaked, but declined to predict where final rates will be. "Our goal is not to trigger a recession, but to tame inflation." - Villeroy de Galhau stressed. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Since the beginning of the year, the cryptocurrency market seems to have been in a cyclical downturn. According to data from the Statista portal, the capitalization of the entire market has fallen by about 58% since the beginning of the year, from $2.3 trillion to $0.97 trillion. Still, in terms of capitalization, bitcoin tops the list, accounting for about 40% of the cryptocurrency market's turnover, according to Coingecko statistics. Additionally, more than 90% of all 21 million bitcoins have already been dug up. The biggest winners since the beginning of 2022 among the TOP 200 according to the current capitalization of the Cryptorank portal are: BinaryX (116% YTD) Trust Wallet Token (57% YTD) ABBC coin (31% YTD) Bitgert (15% YTD) UNUS SED LEO (14% YTD). Green cryptocurrencies? After numerous votes and statistics regarding the CO2 emissivity of the system for digging cryptocurrencies, of which bitcoin is one, many projects have decided to change their computing architecture to "Proof of Storage" or "Proof of Stake." The largest project that has done this is Ethereum. It is estimated that ETH's energy consumption has decreased by 99.99%. Additional examples of green cryptocurrencies include: Cardano (-81% y/y)., Stellar (-67% y/y), and IOTA (-80% y/y). The most volatile cryptocurrencies since the beginning of 2022, according to the Cryptorank portal, are:  Bankera (OLD) (41990% YTD) Tierion (15588% YTD) Insolar (12286% YTD) smARTOFGIBING (4890% YTD). AREON (4027% YTD) As it turns out, the current year has been extremely difficult for the broad market. Someone could get the feeling that cryptocurrencies have become one of the biggest beneficiaries of low interest rates and global additions. Presently, they seem to appear as one of the biggest casualties. Additionally, this seems not to be helped by the damaged confidence towards stablecoins. Until countries change their monetary policies and attitudes towards the cryptocurrency market, there seem to be no positive signs for them. Source: Conotoxia MT5, BTCUSD, Weekly What might 2023 bring? According to current interest rate market assumptions, 2023 could see stabilization in U.S. interest rates above 5 percent. At that time, inflation could also fall below the interest rate. This could, in theory, bring calm to the financial markets. Meanwhile, bitcoin could begin a new halving cycle, which will take place in 2024. Perhaps the current cyclical downturn comes to an end by 2022, and 2023 may be more kind to cryptocurrency holders. Grzegorz Drozdz, Junior Market Analyst at Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. The personal opinion of the author does not represent and should not be constructed as a statement or investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Yesterday we saw the long-awaited decision by the US Federal Reserve on interest rates. The range for the federal funds rate was raised by 75 bps to 3.75-4.00 percent, in line with market expectations. US interest rates are presently at their highest level since 2008. How did the dollar exchange rate react to the decision? The dollar and the interest rate hike The U.S. currency, as well as related markets, including gold or silver, but also U.S. stock indexes, seemed to react to the Fed's decision with increased volatility. At first, the U.S. dollar lost value, only to make up the losses during Jerome Powell's press conference. This could have had to do with the fact that Powell dashed the market's hopes for a quick end to the interest rate hike cycle, which he made clear during the conference. U.S. Federal Reserve Chairman Jerome Powell stressed on Wednesday that it is very premature to think about halting interest rate hikes. Powell also added that "no one knows whether there will be a recession, and if so, how dangerous it will be." The road to a soft landing has narrowed, but it is still possible. Powell stressed that spending growth has slowed and the labor market situation is still good. Inflation is well above the Fed's target, and recent inflation data have been above expectations, but long-term inflation expectations remain "well-anchored" - The Fed chairman noted in statements quoted by the BBN service. Reaction of the dollar exchange rate after the Fed decision Source: Conotoxia MT5, EUR/USD, H1 The EUR/USD pair's exchange rate approached parity shortly after the decision, only to fall towards 0.9800 at the end. This could be related to the still high expectations for further interest rate hikes by the Fed. On the morning of November 3, federal funds rate futures indicated that a 50bp hike could occur in December. In February 2023, the market expects another 50 bp hike and only in March 2023, after the last hike from 25 bp, is the end of the cycle expected. The market today is pricing the end of the cycle at 5.00-5.25 percent, and only next December could see a 25bp rate cut in the U.S. to 4.75-5.00 percent, according to futures and CME exchange data. Stock markets with a bump after the Fed The Nasdaq fell 3.4 percent yesterday, the S&P 500 fell 2.1 percent, and the Dow Jones fell more than 1.5 percent. Higher interest rates, typically also mean higher interest rates on bonds and the U.S. dollar, instruments with potentially little investment risk. The higher the interest rates and the lower the risk, capital could turn away from riskier assets until they are attractively priced relative to the risk-free rate. Hence, Wall Street may continue to be under pressure until companies' earnings prospects improve or their prices become more attractive relative to interest rates.  Nevertheless, interesting companies may emerge in such an environment. One of them may be Boeing, which stands out in the Dow Jones index. The company's share price has risen 6 percent in the past week, and is up 16 percent in a month. The company reported yesterday that it could generate free cash flow of $3 billion to $5 billion in 2023, and $10 billion by the middle of the decade, as it believes it would be able to outsource the delivery of the last of its 737 and 787 aircraft to airlines, its CEO David Calhoun said on Wednesday, as quoted by BBN news service. Source: Conotoxia MT5, Boeing, Weekly Did you know that CFDs allow you to trade on both falling and rising prices? Derivatives allow you to open buy and sell positions, and thus invest on rising as well as falling quotes. At Conotoxia, you can choose from CFDs on more than 100 currency pairs. Wanting to find a CFD on USD/PLN, for example, you just need to follow 4 simple steps: To access Trading Universe - a state-of-the-art center of financial, information, investment and social products and services with a single Smart account, register here. Click "Platforms" in the "Invest&Forex" section. Choose one of the accounts: demo or live On the MT5 or cTrader platform, search for the CFD currency pair you are looking for and drag it to the chart window. Use the one-click trading option or open a new order with the right mouse button. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

As early as today, i.e. November 2, 2022, the U.S. Federal Reserve may decide to raise interest rates by 75 bps for the fourth consecutive year. The current range for the federal funds rate is 3.00-3.25, while the market's expectation is 3.75-4.00 percent. Will this be the last such significant hike in this cycle? Federal Reserve system The Federal Open Market Committee (FOMC) may decide to continue its unprecedented pace of interest rate hikes in early November to combat the highest US inflation in decades. In addition, core inflation seems to have risen faster recently (6.6 percent in September, the highest since 1982), hence a fourth consecutive hike may already be discounted by the market. Moreover, despite previous hikes, the U.S. economy has returned to economic growth, as shown by the latest GDP data (2.6 percent for the third quarter). In addition, job creation in the U.S. economy appears to be maintaining its post-pandemic pace, which may also convince the Fed to continue tightening monetary policy. The Fed may still believe that inflationary risks are directed more upward, and that continued rate hikes are appropriate and that a sustained period of below-trend growth is required to bring inflation under control. What could be the surprise for the USD exchange rate? It seems to be a little chance of a dovish surprise at this point. A few analysts are predicting a 50bp hike, a view that has gained some traction after recent comments by several FOMC members about the risk of over-tightening policy and triggering an unnecessarily deep recession, reports ING in its note. However, it is generally considered a theme regarding the size of rate hikes at future meetings. Nevertheless, it has certainly dampened any talk of a 100bp rate hike. No analyst is forecasting such an outcome based on survey consensus, unlike at recent meetings, according to an ING release. Source: Conotoxia MT5, EURUSD, Daily However, if it turned out that the Fed would follow in the footsteps of the Bank of Canada and raise interest rates by 50 bps, the reaction in the dollar market could be significant. Nonetheless, the US central bank could then focus more on reducing its balance sheet, which in turn could be difficult to do, due to possible liquidity problems. However, it seems that as long as more hikes are expected, which the market is still pricing in, unless month-on-month core inflation starts to fall sharply, the dollar could meet demand again in the event of any weakness. After all, the Fed  seems  still struggling with core inflation, which is moving away from year-end targets, and the central bank's goal may be to achieve positive real interest rates in 2023 (the Fed rate may outpace inflation).Source: Conotoxia MT5, USDIndex, Daily When will the Fed publish its decision? Due to the time change in Europe, but still no time change in the US, the Fed's decision will be published at 19:00 (GMT+1). The post-meeting press conference is scheduled to begin at 7:30 p.m. This is when Jerome Powell will be able to give an overview of the situation in the U.S. economy, and perhaps we will learn what further steps the Fed intends to take. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

October 2022 seems to have brought respite to many asset classes. During this time, the stock, bond or cryptocurrency markets tried to pick up, while the US dollar seemed to lose value at the same time, along with the falling VIX "fear index" contract. Performance of key indices and companies In October,one of the popular futures contracts, the contract for the U.S. Dow Jones Industrial Average index saw the biggest gains. It rose by almost 13 percent during this period. Although the month is not yet over, for the moment, only Verizon ranks in the entire index since the beginning of October with a negative result. On a monthly basis, the decline is 0.92 percent. In contrast, the biggest increase in the index was achieved by Caterpillar (up more than 30 percent). The company reported that sales and revenues in the third quarter of 2022 recorded an annual increase of 21 percent, reaching $15 billion. The company's profit was $2.04 billion, an increase of 43.13 percent compared to the same quarter of the previous year, BBN reported. Operating profit rose 45.73 percent year-on-year to $2.42 billion. Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel engines, industrial gas turbines and diesel-electric locomotives. Source: Conotoxia MT5, Caterpillar, Monthly DAX also with growth in October The second popular instrument, which seemed to rebound from earlier declines, was the contract for the German DAX index. Although emerging macroeconomic forecasts for the German economy appear to be worsening, and the European Central Bank raised interest rates, the DAX rose nearly 10 percent. The company that may have gained the most was Deutsche Bank, as the month's performance was up more than 30 percent by now. The German bank reported its best results since 2016 in October. Net income for the third quarter of 2022 was €6.9 billion, up 15 percent year-on-year and the highest third-quarter income since 2016. The dollar exchange rate fell nearly 1 percent. Market hopes that the U.S. Fed will slow down interest rate hikes at the end of the year and in the first quarter of 2023 may have led the U.S. dollar to fall in October. At the moment, the USD index is trading 0.9 percent lower than at the beginning of the month at 111 points. The EUR/USD exchange rate is near parity at 1.0000, all likely in anticipation of the Fed's November 2 interest rate decision. The market seems to be expecting a 75bp hike to 3.75-4.00 percent, while the end of the hike cycle could be priced in at 4.75-5.00 percent in early 2023. October's biggest declines? It seems that among the popular contracts, the biggest drop in October may be the VIX, which fell 15 percent to 26.86 points this morning. Looking at the chart of the contract showing expected volatility on the S&P500 index, someone could  see that this month's trading may have turned around at a potential resistance level. Source: Conotoxia MT5, VIX, Weekly Will volatility continue at lower levels in November? Here, a lot may depend on the US central bank and events in Eastern Europe. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

U.S. earnings season is underway, and through it, we could learn how the current economic situation is affecting various sectors. Unlike last week, in which it was possible to get an impression of a better-than-expected situation in the banking sector, we now seem to be experiencing a negative surprise among many technology giants. Macroeconomic data At the start of the week, we learned the PMI industrial health index for Germany and the UK, with results of 45.7 points (47 points were expected), and 45.8 points (48 points were expected), respectively. We could see similar readings in July 2022. In addition, these values may indicate a deepening recession in the sector (a reading below 50 points is taken as a decline in activity). On Wednesday, we learned data from the US real estate market. September home sales came in at 604,000 (585,000 was expected), down 74,000 from the previous reading. It seems that the decline may have been caused by rising interest rates and an increase in mortgage rates, which fewer and fewer Americans can afford. On Thursday, we could learn about the Eurozone interest rate decision, which was raised in line with analysts' expectations by 0.75 percentage points, and now the main refinancing rate is at 2% and the deposit rate at 1.5%. The U.S. labor market appears to remain strong, with the number of new claims for unemployment benefits at 217,000 (220,000 was expected). These are the lowest figures since March 2020. Equity market It seems that a positive week cannot be credited to the FAANG tech giants (Facebook, Amazon, Apple, Netflix and Google). Only Netflix surprised with a positive result last week. On the other hand, the CEO of Meta Platforms (Facebook) hinted after the company's conference that he was wary of costs in his metaverse project. This information may have influenced the close of Thursday's session and a share price drop of more than 24 percent. Source: Mt5, Facebook, Weekly Also, surprising was a tweet shared by Elon Musk, in which he showed that he had come with the kitchen sink to Twitter headquarters. We learned that the deal to buy the company was coming to an end at the original price of $54.2 per share. For this reason, the board of directors of the New York Stock Exchange decided to suspend trading of the stock during Friday's session. Meanwhile, the U.S. real estate industry may have surprised positively, as results came in better than expected despite seemingly declining demand and an environment of rising interest rates. Falling commodity prices and widespread inflation may have allowed business costs to be passed on to customers. As a result, almost half of the real estate companies (AlexRe, Equity, Essex, among others) reported net income from operations more than 50 percent higher than expectations. Currency market After Thursday's Eurozone interest rate decision, the EUR/USD exchange rate hovered around parity at 1.000 for a while, eventually falling to a range of 0.995-1.000. It seems that the European currency is starting to strengthen, this time in anticipation of the upcoming FOMC meeting on November 2. Interest rates remained unchanged following Friday's central Bank of Japan (BoJ) meeting. As Reuters reports: “The Bank of Japan kept ultra-low interest rates on Friday and maintained its dovish guidance, cementing its status as an outlier among global central banks tightening monetary policy, as recession fears dampen prospects for a solid recovery. The central bank also announced plans to increase the frequency of its bond buying next month, doubling down on efforts to defend its ultra-loose monetary policy.”. As a result, the price of the USD/JPY pair has risen above JPY 147 since the decision. Source: MT5, USDJPY, Daily Earnings Results season continues next week On Monday, we will learn CPI inflation readings for the Eurozone. On Wednesday, the FOMC's decision on interest rate changes appears to be key. Analysts' consensus is for a 0.75 percentage point hike, in addition, US crude oil inventories may prove important. On Friday, on the other hand, we will learn data on the change in employment in non-farm sectors (NFP), which the FED seems to pay particular attention to. The continuation of the earnings season on Wall Street will show us on Monday the results of the fund of famed investor Warren Buffett, Berkshire Hathaway (BerkshireHa). On Tuesday, we'll learn the Q3 results of healthcare giant Pfizer (Pfizer) and one of the semiconductor and processor industry leaders AMD (AMD). On Thursday, Paypal (PayPal), Starbucks (Starbucks) and Airbnb (AirBNB) will report. The results of the last company may seem particularly interesting, bringing us closer to the situation in the travel industry. Author: Grzegorz Dróżdż, a Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

The end of October and the beginning of November seems to be hectic time in the foreign exchange market, as the European Central Bank has already communicated its interest rate decisions, and the US Fed will do so on November 2. As a result, the forex market may see above-average volatility. Yesterday the European Central Bank raised its three key interest rates by an expected 75 basis points, the third consecutive hike. It could confirm the ECB's determination that further policy tightening would continue until inflation approaches its 2% target. The main refinancing operations rate and the central bank lending and deposit rates were raised to 2%, 2.25% and 1.50%, respectively, with the decision taking effect on November 2. BBN reported that the ECB said that the current inflation rate, which stood at 9.9% last month, remains "far too high" and would remain at elevated levels in the coming months.  How did the euro exchange rate react to the ECB's decision? Source: Conotoxia MT5, EURUSD, H1 The euro exchange rate fell immediately after the ECB decision, perhaps because the market expected a more hawkish stance. The Bank has changed its statement that interest rates will rise at future meetings to a statement that decisions will be made from meeting to meeting. As a result, the market has pushed back its expectations by a full 25 bps, and is perhaps hoping for a softer tone from the ECB due to a potential recession in 2023. Statements after the ECB decision - will they affect the euro? According to the BBN website, Bank of Lithuania head Gediminas Simkus argued on Friday that the next interest rate hike must be significant. A Simkus hinted at the possibility of the ECB raising key rates by another 75 basis points after yesterday's hike, noting that this should not be the new norm. He also shared expectations that the ECB will raise inflation projections in December. In contrast, Bank of France Governor Francois Villeroy de Galhau said Friday that the European Central Bank needs to be cautious in the way it will approach quantitative tightening. However, he expects rapid moves toward normalizing interest rates, BBN reports.ECB President Christine Lagarde said yesterday that the bank's governing council will formally discuss a reduction in the asset purchase program (APP) in December. What can the Fed do? Recent data from the US show a decline in inflation and a drop in activity in the industrial sector and the real estate market. As a result, the market seems to expect that the Fed may begin to slow down the pace of interest rate hikes, and after the November hike, the chance of an end to the cycle in Q1 2023 seems to be increasing. Moreover, the market may expect that the Fed will still cut interest rates by 50 bps next year. Such expectations could have a negative impact on the US dollar and could strengthen the euro, but confirmation of this could be possible on November 2. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the aricle on Conotoxia.com

Trading on CFDs is provided by Conotoxia Ltd. (CySEC no.336/17), which has the right to use the Conotoxia trademark. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Please find below Conotoxia trading hours adjustments for the one-week period following the change in the UK from BST to GMT on 30 October 2022 and the subsequent change in the US from EDT to EST on 6 November 2022. All Times are Eastern European Time (EET). Only products affected are shown in the table.  All other products follow standard trading hours.  If you have any concerns or questions, please don’t hesitate to contact our Customer Support Department via telephone 0035725030046 or email support@cy.conotoxia.com.  We remain at your disposal.   See also:   Oct 27, 2022 2:27 pm Elon Musk bought Twitter? Oct 27, 2022 12:17 pm ECB, GDP and PCE - key events of Thursday Oct 26, 2022 4:49 pm Alexandria RE and the real estate industry with a positive surprise Oct 26, 2022 3:12 pm What do investors not see in Meta Platforms (Facebook) stock price? Oct 26, 2022 10:47 am Industry first, now real estate and the falling dollar - will the Fed slow down with increases? Oct 25, 2022 2:47 pm Which companies' results may surprise us?

Following the first data earlier this week, we could learn the first results of real estate developers in the United States, such as Boston Properties (BXP), Sun (SunCommun), and Alexandria RE (AlexRealE). The latter, in particular, reported remarkably strong results relative to expectations, whose EPS was 104 percent higher than expected. Is the real estate market changing? A period of rising interest rates and high commodity prices did not seem to be favorable for the real estate market.  This could be seen, among other things, from the listing of the Vanguard Real Estate ETF (VNQ), which has lost more than 30 percent since the beginning of the year. However, the prices of construction commodities seem to have fallen much faster relative to real estate prices since recent months. For example, the prices of iron, which is one of the main commodities for this market, have fallen by about 40 percent since their peaks, compared to steel prices on the Shanghai Stock Exchange, which have fallen by about 30 percent since their peaks. Over a similar period, according to the Redfin Institute, real estate prices peaked in May and have since fallen by an average of 6 percent. However, note the demand side, where, according to the Mortgage Bankers Association, "Mortgage applications fell more than 14 percent from the previous week. Sales of existing homes in August fell 19 percent year-on-year, according to the National Association of Realtors." Source: Mt5, VNQ, Weekly Alexandria RE with surprisingly good results Negative data from the demand side seemed to not affect the investment fund, which has been in operation since 1994 and invests in modern life science, AgTech and technology campus office space. As it turned out, the company leased a total of 1.7 million square feet of space (RSF) and saw rental rates increase by about 27%. As it seems, this had a positive impact on EBITDA, which increased by about 23% year-on-year in Q3. The company's revenue seems to have grown steadily since 2012, as did the volume of assets under management. Net income per share EPS was $2.11 (expected $0.66), the same as in Q2 this year. Reduced demand in the market does not seem to be an obstacle for the company, as it seems effectively passing on costs to consumers through increased rental costs. What is being said on Wall Street about Alexandria RE? Source: Mt5, AlexRealE, Daily According to Market Screener, the company has 11 recommendations, 7 of which are “Buy” recommendations. The average target price is set at $182.55, more than 30.2% higher than the last closing price. The highest target price is at $232, and the lowest is at $141. Author: Grzegorz Dróżdż, a Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Alexandria RE and the real estate industry with a positive surprise (conotoxia.com)

Today (October 26) we will learn the results of Meta Platforms (Facebook), a social media company that is part of the five Silicon Valley tech giants known as FAANG (Facebook, Amazon, Apple, Netflix and Google). The environment for the company appears to be unfavorable following the published disappointing results of competitor Snap. Metaverse future, or just a fantasy? Meta has not enjoyed a good run since the beginning of this year. The Metaverse project may have been negatively received by investors, as it could be seen from the company's share price drop of more than 59% since the beginning of the year. The company's CEO Mark Zuckerberg seems to have decided to put everything on the line, which has brought, due to the project's attention, more than $13 billion in costs so far. In addition, we could hear many rumors from the media about the internal situation of the company, or the perspective of employees. However, let's try to verify all assumptions based on hard data regarding the company's core business. Meta Platforms' performance and financial position Last quarter was the first period in which Facebook lost about 1.4 million active users. The company reported that the situation has improved. However, it could be assumed that investors especially decided to watch the development of the company's new project. Analysts predicted earnings per share EPS of 1.89 (previously 2.46).According to one of Altimeter Capital's major shareholders, CEO Brand Gerstner in an open letter to the company, “Meta needs to rebuild trust with investors, employees and the tech community to attract, inspire and retain the best people in the world. [...] Meta shares have declined 55% over the past 18 months (compared to an average of 19% for its big-tech counterparts). The P / E ratio fell from 23x to 12x and is currently half the average P / E ratio of peers. Importantly, this decline in stock prices reflects lost confidence in the company, not just bad sentiment in the market. " In addition, Tuesday's problems with WhatsApp, which stopped working for several hours, may give us an environment of potentially extreme negative sentiment on the company's shares.As Gerstner mentioned in the letter, it seems that valuation has significantly detached itself from the company's core business. Facebook does not seem to have stopped making money from sales, however, it has clearly seen a slowdown in advertising sales, as could be seen from last quarter's results, in which the company reported its first y/y revenue decline. It fell from $29.08 billion to $28.82 billion. At the same time, EBITDA fell from $14.35 billion to $10.33 billion. Everything may depend on the cost of the Metaverse? With such seemingly pessimistic sentiment for this company, all eyes may be on the update and further plans for the Metaverse project. A key piece of information would perhaps turn out to be the subsequent costs incurred for this project. However, someone could get the impression that most of the negative comments have been factored into the stock price. But would the stock market say "buy when the blood pours" be confirmed? What does Wall Street think of Meta Platforms' stock price? Source: Conotoxia MT5, Facebook, WeeklyAccording to Market Screener, the company has 55 recommendations, most of which are buy recommendations. The average target price is set at $209.97, more than 50% higher than the last closing price. The highest target price is at $466, and the lowest is at $150.Author: Grzegorz Dróżdż, a Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read the article on Conotoxia.com

Incoming data from the U.S. economy seems to indicate that the Fed's earlier interest rate hikes may already be hinting at a slowdown. It’s about a slowdown in industry, as well as in the real estate market, where negative surprises seem that have emerged. These could lead to a slowdown in the pace of hikes by the Fed, which is what the market seems to be hoping for at the moment. Worse situation in US manufacturing S&P Global US Manufacturing PMI data released this week showed a reading of 49.9 points in October 2022, compared to 52 in September, and was below market forecasts of 51 points. A reading below 50 points, according to the survey's methodology, signifies a contraction in the manufacturing sector, the first time this has happened since June 2020. New orders fell, signaling a possible drop in demand, with manufacturers stressing that high inflation and inventory build-up from earlier in the year may be contributing to this. The rise in the value of the dollar also caused export demand to fall at the fastest pace since May 2020. Meanwhile, employment grew at a slower pace. In addition, production costs accelerated after a four-month period of mild inflation, mainly due to material shortages and higher wages. Looking ahead, price pressures and expectations of higher interest rates caused sentiment in the industrial sector to deteriorate, the Markit Economic survey showed. Weakening real estate market in the United States The 20-city house price index measured by the S&P CoreLogic Case-Shiller in the US rose 13.1% y/y in August 2022. Thus, the house price growth rate was the lowest since February 2021 and below forecasts at 14.4%. This also marks the fourth consecutive month of slowing house price growth in the United States. All 20 cities posted lower price increases in August, with Miami (28.6%), Tampa (28%) and Charlotte (21.3%) posting the highest year-over-year increases, while San Francisco (5.6%), Washington (7.4%) and Minneapolis (7.6%) posted the lowest. Meanwhile, the National Composite Index rose 13% in August, down from 15.6% in July, the biggest slowdown on record. Given the continued outlook for a challenging macroeconomic environment, home prices may continue to slow," said Craig J. Lazzara, Managing Director at S&P DJI as quoted by tradingeconomics. Source: Conotoxia MT5, USDIndex, Daily The dollar exchange rate seems falling Since the beginning of the week, in fact l since Friday and the possible intervention of the Japanese authorities, the dollar exchange rate seems to be falling. On Wednesday morning, the USD index slipped below the 111-point level. After falling 1% during the previous session. The USD's weakness may be due to the market's growing conviction that the US Federal Reserve would be less aggressive in the coming months. After a widely expected 75-basis-point rate hike in November, Fed officials are probably considering a smaller hike in December amid concerns about excessive monetary tightening, WSJ reported. The aforementioned weaker U.S. data this week, signaling that previous rate hikes may have already had an impact on the economy, seem to support such a view. It also appears that countries such as Japan and China are fed up with a strengthening US dollar. The former has already been expected to intervene twice in the forex market, while the latter was expected to intervene yesterday. As Reuters reported, China's major state-owned banks have been selling U.S. dollars on both the domestic and foreign markets to support the weakening yuan. Daniel Kostecki, director of the Polish branch of Conotoxia Ltd. (Cinkciarz.pl investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75,21% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The earnings season is a period when there could often be recapitulations and the exit of investors from erroneous assumptions. At present, it could only be said what effect the economic situation seems to be having on companies whose releases may have been surprising. Market situation - financial results of companies Already after the first week of financial results for the third quarter of this year, positive surprises in many companies could be experienced. In particular, it seems that companies in the banking sector, which could give an overall view of the sector's performance, performed well. According to John Butters, senior analyst at FactSet, “Through Friday, 20% of the companies in the S&P 500 had reported third-quarter results. Of these companies, 72% reported actual earnings per share, or EPS, above estimates, which is below the 5-year average of 77% and below the 10-year average of 73%, Butters said. In aggregate, companies are reporting earnings that are 2.3% above estimates, which is below the 5-year average of 8.7% and below the 10-year average of 6.5%." Will Humana Inc. surprise again? The Louisville-based U.S. insurer would probably surprise positively, according to the Zacks ranking. The ranking, conducted by the Zacks institute, conducts a meta-analysis of analysts' forecasts and, based on this, estimates likely surprises and their magnitude among analysts. It groups companies by ranking, where the best ones, to whose results analysts least agree, seem to have historically shown the biggest surprises after the earnings releases.Among the companies with a high ranking and recommendation (buy) by the Zacks Institute is Humana Inc. (Humana), which continuously appears to be in a strong uptrend for quite some time. According to the institute's analysis, the company's projected Zacks EPS is 1.12 percent better than analysts' consensus, which now stands at EPS of 6.28 (previously 8.67). The company notoriously seems to have positively surprised analysts with its results for the past 7 years. We will see its earnings report as early as November 2. Source: Mt5, Humana.cfd, Daily The situation in the automotive market After Tesla's (Tesla) relatively positive financial data in the face of worsening sector performance expected by most analysts, it appears to be a surprise. Still, the electric carmaker's shares don't seem to be factoring in the price.As early as October 26, we will learn the financial results of Ford, whose projected EPS is 0.27 (previously 0.68). According to Zacks investment research, “Ford’s third-quarter results are likely to be boosted by an increase in sales volume. The Zacks Consensus Estimate for total wholesale shipments worldwide is pegged at 1,101,000 units, indicating an increase from 1,012,000 units in the year-ago period.", and "The Zacks Consensus Estimate for Ford’s to-be-reported quarter’s earnings and revenues is pegged at 29 cents per share and $37.3 billion, respectively. Ford surpassed earnings estimates in two of the trailing four quarters for as many misses, with the average surprise being 24.5%. ”(the average EPS profit deviation for this company was 24.5% compared to analysts' consensus). If these predictions turn out to be true, positive signals could be expected on the Ford (Ford) share price. Especially considering what seems to be already included in stock prices, i.e. negative factors in the form of rising costs and problems with the supply chain in the industry. Source: Mt5, Ford, Daily What else is on the stock market this week? As it was mentioned in Friday's recap of the week, today's financial reports from Google (Alphabet), Apple (Apple), and Facebook (Facebook), among others, seem particularly important. Of particular interest for the last company would l be the results of the social media industry and their investment in the Metaverse project. Amazon, McDonald's, and MasterCard, among others, will report on Thursday, October 27. Grzegorz Dróżdż, Junior Financial Markets Analyst Conotoxia Ltd. (Cinkciarz.pl investment service) The above commercial publication does not constitute an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No. is prepared for information purposes and should not constitute the basis for making investment decisions. Neither the author of the study nor Conotoxia Ltd. are responsible for investment decisions made on the basis of the information contained in this publication. Copying or reproducing this work without the written consent of Conotoxia Ltd. is prohibited. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.21% of retail investor accounts lose money when trading CFDs with this CFD provider. Consider whether you understand how CFDs work and whether you can afford the high risk of losing your money. Read the article on Conotoxia.com

On Friday, September 21, during the late afternoon hours in Europe and, in turn, the evening hours in Japan, there was a sharp plunge in the USD/JPY exchange rate. Quotations plunged from around 151.50 to 146 yen per dollar. The market was expected to see another intervention by Japanese authorities after the yen had previously weakened to levels last seen 32 years ago. Is the yen sinking in strength? Japanese Finance Minister Shunichi Suzuki said Monday that the government is trying to confront currency speculators as the yen continues to fluctuate widely. The systematic weakening of the currency prompted another Bank of Japan intervention on Friday. Suzuki assured that the ministry is monitoring the currency market, BBN reported. In turn, Japanese Deputy Finance Minister for International Affairs Masato Kanda added that the government "will continue to take appropriate measures against excessive disorderly movements in the market." Source: Conotoxia MT5, USD/JPY, H1 Statements by Japanese authorities Masato Kanda also told reporters that Japan cannot tolerate speculators who significantly alter currency rates and have a negative impact on people's lives and the global economy. Meanwhile, Japanese Prime Minister Fumio Kishida issued a new warning on Saturday against excessive yen movements in the currency market, saying the country will not hesitate to take "appropriate" measures when necessary. In turn, Bank of Japan Governor Haruhiko Kuroda said the central bank must support Japan's economic recovery from the pandemic. The BOJ  would do everything to achieve stable inflation supported by wage growth. The rapid weakening of the yen is becoming a factor in lifting inflation, according to quotes published by Bloomberg. Will the Bank of Japan fight the Fed? It appears that the main factor that may be behind the yen's weakening in recent months is the divergence in the monetary policy pursued by the Fed and the Bank of Japan. The Fed has opted for an unprecedented pace of interest rate hikes, while the Bank of Japan persists with loose monetary policy. As a result, the U.S. dollar is increasing its interest rate in favor of the Japanese yen, and capital seems to be flowing to where it can get more interest. Source: Conotoxia MT5, USD / JPY, MN. Nonetheless, current Japanese actions seem to indicate that the finance ministry  would try to chase away those who gamble on further JPY weakness. If this is indeed the case, it seems  that Japan  believes the Fed is indeed close to moving away from the pace of 75 bp hikes every meeting. With the BOJ poised to maintain ultra-low policy at this week's meeting, the only hope for lasting relief for the yen should come from the other side of the Pacific. If that doesn't happen, however, it seems that the only result Japan might achieve, would be a decline in foreign exchange reserves. Did you know that CFDs allow you to trade on both falling and rising prices?Derivatives allow you to open buy and sell positions, and thus invest when quotes rise as well as fall. At Conotoxia, you can choose from CFDs on more than 100 currency pairs. Wanting to find a CFD on USD/JPY, for example, you just need to follow 4 simple steps: To access Trading Universe - a state-of-the-art hub of financial, information, investment and social products and services through a single Smart account, register here. Click "Platforms" in the "Invest&Forex" section. Choose one of the accounts: demo or live On the MT5 or cTrader platform, search for the CFD currency pair you are looking for and drag it to the chart window. Use the one-click trading option or open a new order with the right mouse button. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Read more reviews and open a demo account at invest.conotoxia.com Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.21% of retail investor accounts lose money when trading CFDs with this CFD provider. Consider whether you understand how CFDs work and whether you can afford the high risk of losing your money. Read the article on Conotoxia.com

In the world of macro data this week, the market was able to take a break from central banks' decisions on interest rate changes. On Tuesday, we had the results of the German economic sentiment index, which turned out to be more positive than expected at -59.2 points (forecast -65.7 points). Further down, however, are the low levels last seen during the crisis in 2008. Macro Data Wednesday saw the release of CPI inflation results for the Eurozone and the UK, among others, which were close to market expectations at 9.9% (forecast 10%) and 10.1% (forecast 10%), respectively. The data showed that inflation still seems to be breaking records.  Finally, of the key macroeconomic data, the number of new applications for unemployment benefits filed in the United States was positive, falling to 214,000 (forecast 230,000).   There is an estimation that the rising global inflation and the non-worsening labour market may not change the monetary policy stance from central banks. As it was mentioned in the morning's commentary on the bond market: "Looking at the chart of the quotation of the ETF with the symbol AGG, someone could see that since the peak in August 2020, the price of a unit of this fund has fallen by more than 20 percent [...] Nevertheless, presently, until the peak in US interest rate hikes is reached, this market may continue to be under pressure." Source: Conotoxia MT5, AGG, Weekly Stock Market The current week has been in terms of the earnings season for the third quarter of this year, particularly reported results from the banking sector, most of which reported positive earnings per share (EPS) results than expectations. Among others, Bank of America Corp. (BankofUS) EPS 0.81 (forecast 0.77), Goldman Sachs Group Inc. (GS) EPS 8.25 (forecast 7.69), or Blackstone Inc. (Blackstone) 1.06 (forecast 0.99). This could be a positive sign, because as the stock market saying goes, "there is no bull market without banks."  Surprising for analysts were the results of Tesla (Tesla), Netflix (Netflix) and Snap (Snap), which do not seem to be affected by the spectre of recession. The giant, which sells electric cars, improved net income to $3.33 billion (forecast $1.65 billion), revenue growth jumped 55 percent year-on-year, and earnings per share (EPS) came in at $1.05 (forecast $0.99). Netflix surprised with its first increase in subscriptions since the beginning of the year, which may have pushed its stock price up more than 10 percent at the opening of Wednesday's session.  Source: Conotoxia MT5, Netflix, Weekly In the social media market, one of the first reports was presented by the owner of Snapchat, whose y/y revenues did not seem to show significant change. Investors seem to reacted negatively, however, after the number of users of the Snapchat app appears to have fallen for the fifth consecutive quarter.Source: Conotoxia MT5, Snap, Weekly Currency Market In the absence of a decision on interest rate changes this week,  someone  could see no significant changes in the currency market. The EUR/USD pair continues to hover below parity at 1.00. Recall that these are values previously seen more than 20 years ago. Noticeably weakened the Japanese yen against the US dollar (USD/JPY) piercing the level of JPY 150. The question of possible intervention by the Bank of Japan is beginning to arise, as the exchange rate of this currency pair has risen by more than 30 percent since the beginning of the year. For the British pound, on the other hand, more uncertainty may continue, due to political developments. The recent rise in the GBP/USD pair came after the resignation of the British Prime Minister from office. Source: Conotoxia MT5, GBP/USD, Weekly The earnings season continues next week? Next week on Wall Street will be packed with the publication of reports from well-known companies. On Tuesday, Google will present quarterly results along with Coca-Cola or Microsoft. On Wednesday, there will be a report from Apple, which recently decided to cut orders for the new iPhone due to falling demand. Facebook will also present results on that day. Online retail giant Amazon will present its report on Thursday, October 27, along with McDonald's and MasterCard.  In addition, next week we could expect, among other things, the ECB's decision on interest rates in the Eurozone, CPI inflation in Germany and GDP results in the United States. In addition, at the end of the week there will be a meeting of the central Bank of Japan (BoJ), where it is possible that the topic of possible intervention in the foreign exchange market or a change in the range for Japanese bond yields would come up. The results of Tuesday's consumer mood report from the United States (CB Consumer Confidence) may seem interesting.    Grzegorz Dróżdż, a Market Analyst of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

Treasury bonds, while they may be considered a relatively safe investment instrument, it seems that they cannot boast the above status this year. The dynamics of changes in interest rates seem to be unprecedented, which may force big changes in the bond market. Bond yields Yields on U.S. 10-year bonds surpassed the 4.25 percent level this week for the first time in 14 years. Further price declines and yield increases may have followed statements by Federal Reserve officials, who continue to reaffirm a commitment to long-term restrictive monetary policy, which may keep negative pressure on U.S. government bonds, which appear less attractive to investors in a high interest rate environment. They may also wait for further debt issuances already with higher interest rates and, in favor of them, dispose of current paper that had lower interest rates. Statements relevant to interest rates and bonds Federal Reserve Bank of Philadelphia President and CEO Patrick Harker said Thursday that the federal funds rate will be "well above" 4 percent by the end of 2022 due to a "frankly disappointing lack of progress in curbing inflation," BBN reported. The Fed will stop raising interest rates next year, Harker added. The restrictive stance the central bank will take at this point should remain in place "for some time to allow monetary policy to do its job." He went on to estimate that GDP growth will be "flat" this year, and will soon rise by 1.5 percent and around 2 percent in 2023 and 2024, respectively. The unemployment rate will peak at 4.5 percent in 2023 and should fall to 4 percent in 2024, "suggesting that even as we tighten monetary policy, the labor market will remain quite healthy." - Harker stressed in his statement, quoted by BBN. What does the scale of the bond sell-off look like? Source: Conotoxia MT5, AGG, Weekly Looking at the trading chart of the ETF with the symbol AGG, someone could see that the price of a unit of this fund has fallen by more than 20 percent since its peak in August 2020. What is the AGG fund? The iShares Core U.S. Aggregate Bond ETF seeks to track the investment performance of an index composed of the entire U.S. investment grade bond market. According to the issuer, AGG can provide broad exposure to U.S. investment-grade bonds, which also includes Treasury bonds. Nevertheless, for the moment, until a peak in US interest rate hikes is reached, the market may continue to be under pressure. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

Recently, investors and speculators in the cryptocurrency market seemed to focus on Merge ETH and the transition from PoW to PoS. This event is now behind us, and for the moment it does not seem to affect the ETH price particularly. Meanwhile, after a deep bear market, the topic of bitcoin halving may soon come to mind. This event may take place in April 2024. Halving bitcoin About once every 4 years, or more precisely every 210000 blocks, the issuance of new bitcoin is halved. This is due to the BTC algorithm, which was created in 2008, where every 4 years or so the reward to miners halves. The process should continue until there are no more than 21 million BTCs in the world, which could be around 2140. By now, more than 90 percent of the total supply of bitcoin is already on the market, while by 2030, at this rate of new coin creation, there could already be 98 percent of the total supply on the market. The halving phenomenon, in turn, is supposed to be responsible for controlling the deflationary nature of this cryptocurrency. With each successive halving, BTC becomes a rarer good and its inflation rate decreases. Today, bitcoin's inflation rate is 1.78 percent. After the next halving, in April 2024, this inflation rate will drop to 1.1 percent, etfstream calculates. What has been the history of BTC halving? As already mentioned, every 4 years or so, there is a processing of 210000 blocks, which halves the amount of reward miners receive. Bitcoin went public in January 2009. At that point, the incentive given to miners for supporting the blockchain and verifying the network was 50 BTC. The first halving of bitcoin took place when 210000 blocks were successfully mined, and this occurred on November 28, 2012. At that time, the reward dropped from 50 to 25 BTC. Another 210000 blocks were processed on July 9, 2016. The reward halved from 25 BTC to 12.5. In 2020, the reward was already only 6.25 BTC, and in 2024, according to the algorithm, it will be 3.125 BTC. Source: Conotoxia MT5, BTC/USD, MN Bear market vs. time after bitcoin halving Why are we writing just now about an event that will not take place until April 2024? The reason may be the potential cycles of the BTC market, which has seen spectacular increases and massive corrections. Nevertheless, after the halving, the BTC price reached its bottom in a correction for about 29 months after the event. The last halving took place in May 2020. So now it is just 29 months since the reduction of the miners' reward, and the market seems to be in a strong correction. If history and the cycles of BTC were to repeat itself, it seems that the current fall could be significant for this market. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

While consumer inflation seems to be slowing down in the United States, looking at the CPI measure, the opposite is true in the Eurozone or the United Kingdom. Price growth continues to accelerate, according to data released today. What is the inflation rate in Europe? The annual inflation rate in the eurozone rose to 9.9 percent in September 2022, up from 9.1 percent a month earlier. This is the highest inflation rate since measurements began in 1991. Inflation has thus moved further away from the European Central Bank's 2 percent target, which may cause policymakers to continue tightening monetary policy despite the risk of recession. The main upward pressure for eurozone prices came from the energy sector (40.7 percent versus 38.6 percent in August), followed by food (11.8 percent versus 10.6 percent), services (4.3 percent versus 3.8 percent) and non-energy industrial goods (5.5 percent versus 5.1 percent). Annual core inflation, which excludes volatile energy, food, alcohol and tobacco prices, rose to 4.8 percent in September. On a monthly basis, consumer prices rose 1.2 percent, Eurostat reported. Source: Conotoxia MT5, EUR/USD, H4 Prices in the UK are also rising The UK's annual inflation rate rose to 10.1 percent in September 2022 from 9.9 percent in August, returning to the 40-year high reached in July and beating market expectations of 10 percent, trading economics reported. The biggest contributor to the increase was food, which became more expensive by 14.8 percent. Costs also rose sharply for housing and utilities, as they rose by as much as 20.2 percent, mainly, due to soaring electricity or gas prices. In contrast, core inflation on an annualized basis, which excludes energy, food, alcohol and tobacco, rose to a record 6.5 percent, compared to expectations of 6.4 percent, according to data from the Office for National Statistics. Source: Conotoxia MT5, GBP/USD, H4 High inflation in Europe - central banks with no way out? High inflation may not give much room for further action by central banks in the context of executing the so-called pivot, i.e. a turnaround in the current monetary policy, which consists mainly of interest rate hikes. Further price increases could seal further interest rate hikes in the Eurozone or the UK, which in turn could affect household budgets, but also company valuations. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

Investors in the financial markets seem to be buying riskier assets, perhaps hoping that other central banks would follow the footsteps of the Bank of England or the European Central Bank. The talk is about a soft approach to QT and further interest rate hikes. Read next: JP Morgan Net Income Over $9B | Kanye West Is Buying Parler| FXMAG.COM Bank of England - Quantitve Tightening Delayed? As the Financial Times reported on Tuesday, the Bank of England is possibly postponing the start of quantitative tightening (QT) again. The central bank had originally intended to begin selling £838 billion worth of British government bonds on October 6, but postponed that plan until the end of the month. However, presently bank officials reportedly agree that reducing the balance sheet should be delayed again until the bond market stabilizes following the shock of the government's mini-budget tax proposals, most of which have since been withdrawn. BoE Governor Andrew Bailey recently said the central bank would primarily use higher interest rates, rather than quantitative tightening, as its main tool to fight inflation, BBN news reported. However, a spokesman for the Bank of England declined to comment on the report published by the Financial Times. Source: Conotoxia MT5, GBP/USD, Daily ECB with a slower pace of hikes? Will the EUR/USD exchange rate stabilize? European Central Bank Vice President Luis de Guindos said Monday that the ECB could not rule out the possibility of the eurozone suffering a technical recession, but added that any slowdown would not be severe. Speaking on the occasion of the 20th anniversary of the euro organized by the Consejo General de Economistas de Madrid, he noted that he sees the eurozone currency stabilizing in the coming months. De Guindos reiterated that he expects soaring inflation to begin to subside next year, according to a quote published by BBN. Also, the Financial Times reported today that French central bank chief François Villeroy de Galhau expects the European Central Bank to continue its rapid pace of interest rate hikes until its deposit rate reaches 2 percent by the end of the year. Any increases after that point would be at a "more flexible and slower pace," the European Central Bank policy maker told the FT in an interview. The ECB could stop exchanging some of the bonds maturing under its asset purchase program from the end of this year, and balance sheet reduction will be carried out cautiously, Bloomberg reported. EUR/USD - technical analysis Source: Conotoxia MT5, EUR/USD, Daily From the point of view of technical analysis, the EUR/USD exchange rate seems to have slowed down the downward momentum. Nevertheless, the quotation still remains inside the medium-term channel, the upper and lower limits of which could mark potential resistance and support for the EUR/USD. Thus, for the market to move at least to larger in price and time consolidation, it would first have to overcome the line outlined after the peaks. Then, possibly, the next potential resistances could be in the area of 0.9996 or 1.0191. Daniel Kostecki, director of the Polish branch of Conotoxia Ltd. (Cinkciarz.pl investment service) The above trade publication does not constitute an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No. 596/2014 of April 16, 2014. It has been prepared for informational purposes and should not form the basis for investment decisions. Neither the author of the study nor Conotoxia Ltd. are responsible for investment decisions made on the basis of the information contained in this publication. Copying or reproduction of this study without written permission from Conotoxia Ltd. is prohibited. Read article on Conotoxia

Changes on the British political scene could be important for the pound exchange rate, as well as for the entire British financial market, including the future of Prime Minister Liz Truss' government. As recently as the end of last week, the UK media began to speculate about changes in the position of Chancellor of the Exchequer, which then actually took place. Falling pound as a result of a flawed plan? Kwasi Kwarteng, the former chancellor who resigned on Friday, was responsible for planning the UK's massive tax cuts. The plan was perhaps simple - let the British have more money in their pockets, as the cost of living is rising and inflation is not letting up (that sentence alone may show the absurdity of the idea). The difference between the previously planned UK budget and the lack of tax revenues by cutting them was to be patched up by issuing bonds. At the mere thought of this, the debt market crashed, and the Bank of England had to intervene. The British pound also collapsed, falling at one point to $1.0350. That's when speculation began that perhaps GBP-USD parity was possible by the end of the year. Source: Conotoxia MT5, GBP / USD, Daily. End of BOE interventions and new Chancellor of the Exchequer Bond market interventions led by the Bank of England were scheduled to end on Friday, October 14. That was when Kwasi Kwarteng resigned, and was replaced by Jeremy Hunt. It may now be on his shoulders to come up with a new plan for British taxes, as well as to restore confidence in the government of Prime Minister Liz Truss, who has received 100 letters of no confidence. They were submitted by Conservative Party MPs, the Sunday Times and Sunday Express reported.  According to British local media, Prime Minister Liz Truss is fighting for her political survival. They indicate that her party may call for her resignation as early as this week. Reports published by the Guardian, Daily Record and Daily Mail, noted Monday that a number of MPs have formed a "conspiracy to oust" Truss, claiming that her "game is up." The Tories were holding "secret talks" over the selection of a new party and cabinet leader, one report claimed, the BBN news service reported. Source: Conotoxia MT5, UK100, Weekly Goldman Sachs on the UK - will there be a recession? British Prime Minister Liz Truss has announced that she would maintain the previous government's planned increase in corporation tax from 19 to 25 percent. "This will raise £18 billion a year. It will act as a down payment on our full medium-term fiscal plan," the details of which Hunt is expected to unveil by the end of the month. Goldman Sachs analysts downgraded their UK economic forecasts after Prime Minister Liz Truss expressed her desire to raise corporate tax. Significantly tighter corporate finance conditions and higher taxes on corporations from next April, led to the downgrade of the UK's growth forecast. "A more significant recession is now expected." - Bloomberg quoted a report by Goldman Sachs bank as saying. In an analysis published Sunday, GS analysts believe the British economy will contract by 1 percent next year (they had previously forecast a 0.4 percent drop in GDP). Pound exchange rate - what to expect? The specter of a deeper recession, more difficult financing for businesses, still high inflation, political uncertainty, could still take its toll in the near future on the GBP or FTSE100 quotations, which seem to be trying to stabilize after the recent period of great turbulence. Did you know that CFDs allow you to trade on both falling and rising prices? Derivatives allow you to open buy and sell positions, and thus invest when quotes rise as well as fall. At Conotoxia, you can choose from CFDs on more than 100 currency pairs. Wanting to find a CFD on GBP/USD, for example, you just need to follow 4 simple steps: To access Trading Universe - a state-of-the-art center for financial, information, investment and social products and services through a single Smart account, register here. Click "Platforms" in the "Invest&Forex" section. Choose one of the accounts: demo or live On the MT5 or cTrader platform, search for the CFD currency pair you are looking for and drag it to the chart window. Use the one-click trading option or open a new order with the right mouse button. Daniel Kostecki, director of the Polish branch of Conotoxia Ltd. (Cinkciarz.pl investment service) The above trade publication does not constitute an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No. 596/2014 of April 16, 2014. It has been prepared for informational purposes and should not form the basis for investment decisions. Neither the author of the study nor Conotoxia Ltd. shall be liable for investment decisions made on the basis of the information contained herein. Copying or reproduction of this study without written permission from Conotoxia Ltd. is prohibited. Read full article on Conotoxia

Cardano (ADA) has lost more than 24% since the long-awaited Vasil update, as investors seem to become increasingly dissatisfied with the market's reaction. Vasil Update - an update without a reflection in the price? Vasil was supposed to be one of the major developments of the project, which, like previous updates e.g. the 'Mary hard fork update', was supposed to foster efficiency and network growth, and ultimately increase Cardano usage. The most important areas of the update were to include improvements to throughput, transfer speed and the Plutus language for the development of dApps (decentralised applications), i.e. applications that can be developed on the project infrastructure. Following the launch of the 'Vasil update' on 23 August in Europe, the price of the coin rose by more than 12% in the following weeks. However, it then began to fall. Is possible that the low volatility of the ADA price at the end of September was due to the general sideways trend across the crypto market, which was also seen in leading tokens such as Ethereum and Bitcoin. What's next for Cardano? Cardano price, daily candles Source: Conotoxia MT5 Investors have been selling off the token significantly since the beginning of this week, with the token losing more than 15% on the Conotoxia MT5 platform today at 15:00 GMT+3. Such large declines may also be driven by regularly deteriorating sentiment in other markets, with which the token appears to have been strongly correlated over the past year. According to Macroaxis data, the 3-month average correlation between Cardano and the QQQ ETF, which gives exposure to the Nasdaq Composite index, is now as high as 0.75. The Ethereum merge that affected the performance and cost of ETH may also play a role in Cardano's performance. The blockchain of the world's second-largest token has become, thanks to infrastructure changes, a very attractive place to develop dApps, which may impact growth expectations for the ADA project. An additional factor that may favour short-term declines in the value of the token is the relatively large run-up of the ADA, from a local low (in July this year). It has provided enough room for the downside we are now seeing. The token scored a 35% rally during this period, broken along with other coins in the second half of August. How to find CFDs on Cardano? CFDs allow you to open buy and sell positions, and thus invest when quotes rise as well as fall. At Conotoxia, you can choose from CFDs on more than 5,000 financial instruments, including more than 140 CFDs on cryptocurrencies. Wanting to find CFDs on Cardano, all you need to do is follow 4 simple steps: To access Trading Universe - a state-of-the-art center for financial, information, investment and social products and services with a single Smart account, register here. Click "Platforms" in the "Invest&Forex" section. Choose one of the accounts: demo or live On the MT5 platform, search for a CFD cryptocurrency and drag it to the chart window. Use the one-click trading option or open a new order with the right mouse button. Rafal Tworkowski, Junior Financial Markets Analyst, Conotoxia Ltd. (Cinkciarz.pl investment service) The above trading publication does not constitute an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of 16 April 2014. It has been prepared for information purposes and should not form the basis for investment decisions. Neither the author of the study nor Conotoxia Ltd. accepts any responsibility for investment decisions made on the basis of the information contained in this publication. Reproduction or reproduction of this study without the written consent of Conotoxia Ltd. is prohibited. Read article on Conotoxia.com

Today's release of US inflation data for September may be the one the markets have been waiting for, since the beginning of the week. In light of these expectations, the situation on the Japanese yen, which has weakened once again to levels not seen in 24 years, seems to be shaping up interestingly, with only a trace left on the USD/JPY chart after the Bank of Japan's latest intervention. Yen exchange rate The Japanese yen has weakened towards JPY147 per USD, being close to the levels of August 1998. The recent weakness of the Japanese currency may be due to the statements of the Bank of Japan Governor, who confirmed the maintenance of loose monetary policy in Japan to support the economic recovery. Haruhiko Kuroda added that Japan's economy is still recovering from the pandemic, and that the Bank of Japan's goal is to keep inflation stable in the region of 2 percent. This approach may mean that Japan and the United States may present two very different approaches to monetary policy. In the U.S., interest rates may continue to be raised, while in Japan they may remain unchanged, close to zero. Source: Conotoxia MT5, USDJPY, MN Another Bank of Japan intervention after inflation data release? Japanese Finance Minister Shunichi Suzuki reiterated today that the government is ready to take "decisive" action to counteract the yen's steep decline, but added that the issue is the dynamics of exchange rate movements, not a specific level. As a result, it is the volatility on the USD/JPY pair that may determine interventions, not where the exchange rate of the pair might be . Nevertheless, with today's release of inflation data from the US, volatility could be elevated. This, in turn, could favor the Japanese authorities' decision to intervene. The Japanese intervened in the currency market last month for the first time since 1998, when the yen weakened to levels not seen in 24 years. The intervention, from which there is no trace now, was expected to cost nearly $20 billion, according to Bloomberg data. US inflation data in focus According to market consensus, US inflation in September on a m/m basis was expected to rise by 0.2 percent, while core inflation was expected to rise by 0.5 percent. Meanwhile, on an annual basis, price growth was expected to be 8.1 percent for CPI inflation and 6.5 percent for core inflation. It is the latter reading that may be particularly important. While CPI inflation may have peaked at 9.1 percent in June, the peak for core inflation at 6.5 percent may be surpassed today. Publication today at 14:30 GMT+2. Daniel Kostecki, director of the Polish branch of Conotoxia Ltd. (Cinkciarz.pl investment service)The above commercial publication does not constitute an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of April 16, 2014. It has been prepared for information purposes and should not constitute the basis for making investment decisions. Neither the author of the study nor Conotoxia Ltd. are responsible for investment decisions made on the basis of the information contained in this publication. Copying or reproducing this work without the written consent of Conotoxia Ltd. is prohibited. Read article on Conotoxia

Financial markets, especially in the United States, which appear less affected by the energy crisis than Europe's, seem to be waiting for important inflation data. Today, information will be published showing the price increases faced by producers (PPI inflation), while tomorrow there will be data on consumer inflation (CPI). Inflation data and expectations Before we move on to the discussion of the latest inflation data or the market consensus for the current reading, we can take a look at several other data, the task of which may be to express an opinion on the expected future inflation. The Federal Reserve Bank of New York reported that the median of one-year inflation expectations fell by 0.3 percentage points to 5.4 percent, the lowest value since September 2021. A survey of consumer expectations conducted by the New York Fed in September 2022 also showed that the three-year inflation expectations rose by 0.1 percentage point to 2.9 percent, and the five-year one rose by 0.2 percentage point to 2.2 percent, the BBN website reported. Household spending expectations, on the other hand, have plunged sharply, recording the largest one-month decline since the franchise was launched in June 2013, the New York Fed wrote in a report. Source: Conotoxia MT5, XLY, W1 Limited disposable income and its possible impact on the market The US economy appears to be largely based on consumption, including consumption on credit. Currently , such consumption seems to be slowing down due to the increase in food prices or higher costs of maintaining a household. In turn, Americans' disposable income has decreased. This may mean that consumers shift their spending from goods that they do not need to live, towards basic necessities. This could be also seen in the strong weakness of the ETF DMA quotations on the XLY Consumer Discretionary, i.e. the ETF with exposure to companies producing so-called discretionary goods. In other words, they are goods without which we can live in worse times, and they make our lives easier in better times. XLY fell 35% from its peak to yesterday's close, more than the broad S&P500 index, which fell 25%. Source: Conotoxia MT5, W1 This may quite show that high inflation may inhibit purchases of unnecessary goods, and its fall could fuel this demand again. We will find out about inflation in the US in September tomorrow at 14:30 GMT + 2. This may be one of the most awaited macroeconomic data of the week. Today, in turn, apart from the publication of PPI inflation, the market will learn in the evening the minutes of the last FOMC meeting (20:00 GMT + 2). Daniel Kostecki, director of the Polish branch of Conotoxia Ltd. (Cinkciarz.pl investment service) The above commercial publication does not constitute an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of April 16, 2014. It has been prepared for information purposes and should not constitute the basis for making investment decisions. Neither the author of the study nor Conotoxia Ltd. are responsible for investment decisions made on the basis of the information contained in this publication. Copying or reproducing this work without the written consent of Conotoxia Ltd. is prohibited. Read more on Conotoxia

A new report by S&P Global Mobility predicts possible difficult years for the European automotive industry, whose production could fall by around 1 million cars in a year. A testing moment for car manufacturers? Supply chain issues, the energy crisis and high inflation would probably pose growing challenges for the automotive sector. Parts shortages related to transport bottlenecks appear to be the most pressing. A major risk in the coming months could be attributed to the supply of energy, shortages of which would directly affect production volumes. "The pressure on the automotive supply chain will be intense, especially the more one moves upstream from vehicle manufacturing," - said analyst Edwin Pope It may even be possible for production to temporarily stop, similarly to the Covid-19 pandemic when essential parts for car production were in short supply. According to S&P Global Mobility, factories in Europe are capable of producing between 4 million and 4.5 million vehicles per quarter, but this could drop to as low as 2.8 million in the winter if a worst-case scenario occurs. Interestingly, according to S&P Global analysts, the least exposed factories are no longer those in the Czech Republic and Germany, where full gas reserves and reduced consumption are helping to contain the situation, but those in Spain, Italy and Belgium. These are countries whose energy industry is less likely to be self-sufficient in the coming months, especially due to low reserve levels. Consequences for sector companies The above data may be concerning Volvo (Belgium), Stellantis (Italy and Spain), Volkswagen (Spain and Belgium), Renault (Spain) and Iveco (Spain and Italy). Stellantis owns many brands including Opel, Fiat, Alfa Romeo and Jeep. The crisis could therefore affect a large part of the sector, reflecting reduced revenues and profits. Volkswagen share price, daily candles Source: Conotoxia MT5 On the Conotoxia MT5 platform at 14:30 GMT+2, Volkswagen, Stellantis, and Renault shares are losing 0.9%, 0.9% and 4.1%respectively, with Volkswagen reaching the price levels of July this year falling to €121 per share.   Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

Solana is facing another problem that attacks token users. The virus is spreading through NFT's loyalty programmes (airdrops), claiming to be a Solana Phantom security update. Through NFT to Solana wallet Following the hacking attacks on Solana Phantom wallets, which exploited the project's system in August (a bug in the code), another attack on the security of network users is taking place. For at least two weeks, unknown hackers have been carrying out so-called airdrops, or promotional campaigns in which NFTs can be won for Solana (SOL) users. The NFTs being distributed are titled 'PHANTOMUPDATE.COM' and 'UPDATEPHANTOM.COM', which, when opened, display information about a security update. However, instead of a new version of the software, users install a virus which then steals the tokens. Additionally, the message informs users that failure to update could result in "loss of funds due to hackers using the Solana exploit". This message most likely refers to an earlier hacking attack in August, which made waves in the crypto world. The result was the loss of $8 million from around 8,000 wallets. The virus is installed via a script from the GitHub developer site. It then attacks browser information such as history, cookies, passwords, SSH codes and other user information. Users with a wallet added to their browser appear to be the most vulnerable. Cena Solany (SOL), daily candles Source: Conotoxia MT5 On the Conotoxia MT5 platform at 13:00 GMT+3, Solana is losing 3.7%. The chart shows the plunge that followed the aforementioned hacking attack in August. The current attack seems unlikely to have the same magnitude. Rafal Tworkowski, Junior Financial Markets Analyst, Conotoxia Ltd. (Cinkciarz.pl investment service) The above trading publication does not constitute an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of 16 April 2014. It has been prepared for information purposes and should not form the basis for investment decisions. Neither the author of the study nor Conotoxia Ltd. accepts any responsibility for investment decisions made on the basis of the information contained in this publication. Reproduction or reproduction of this study without the written consent of Conotoxia Ltd. is prohibited. Read more on Conotoxia

The word recession is starting to appear more and more often not only in the media, but also in the statements of the most important institutions and people in the world. Recently, the International Monetary Fund and the World Bank warned of a global recession, and now also the CEOs of the largest banks are echoing. Recession in the USA? JPMorgan Chase CEO Jamie Dimon told CNBC on Monday that the US economy "is still doing well" but expects it to enter a recession in the next nine months, BBN reported. Dimon warned that high inflation and rising interest rates, as well as the uncertainty surrounding the war in Ukraine, are "very, very serious things that I think will probably push the United States and the world - I mean Europe is already in recession - and they're likely to put the United States into some kind of recession six to nine months from now. " Several US Federal Reserve officials said that the US could still avoid recession, and some stressed that even if the economy slipped into a recession, the bank should not stop at rate hikes. Source: Conotoxia MT5, US500, Weekly What do Fed officials say about economic growth? Federal Reserve vice chairwoman Lael Brainard said on Monday that the US central bank's move to tighten monetary policy would have a full impact on economic activity "in the coming quarters" and its pressure on prices "may take longer," the BBN news service said. "The transmission of tightening policies is most evident in highly interest-rate-sensitive sectors such as housing," but the "moderate demand" that the Fed wants to see across the US economy, "so far has materialized only partially," she explained in a speech out of 64. The annual meeting of the National Association for Business Economics in Chicago, Illinois. Due to rising interest rates and changes in general financial conditions, "rebound in the second half of the year will be limited" and "real GDP growth will be broadly flat this year," Brainard said in a statement quoted by the BBN. Recession -what could it mean for the markets? Looking at business cycles, the documented economic recession phase could be characteristic of the late bear market phase. This may mean, in turn, that previously markets were in a bear market awaiting a recession. When this one actually shows up, the bear market may be in its final stage. Nevertheless, the bottom of a bearish market may also depend on how long the recession will last, how many quarters it will take, and how deep it will be.   Daniel Kostecki, director of the Polish branch of Conotoxia Ltd. (Cinkciarz.pl investment service) The above commercial publication does not constitute an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of April 16, 2014. It has been prepared for information purposes and should not constitute the basis for making investment decisions. Neither the author of the study nor Conotoxia Ltd. are responsible for investment decisions made on the basis of the information contained in this publication. Copying or reproducing this work without the written consent of Conotoxia Ltd. is prohibited. Read more on Conotoxia

According to Token Terminal data, Ethereum protocol revenues are down a whopping 86% in the third quarter, alongside the falling price of the token itself. Declining Ethereum network revenues At its peak last year, revenues generated in November were as high as $1.6 billion. However, the amounts have dropped significantly in previous months. They stood at $82.1, $65.6 and $52.4 million in July, June, and September this year respectively. These sums cannot be considered as revenue for Ethereum's founders and administrators, as there is no centralized company as such. Instead, these revenues were mainly due to the miners and validators of the network, who were de facto responsible for its operation. Will this have an impact on the price of ETH? Revenue from the Ethereum protocol comes primarily from fees charged by the ETH protocol (gas fees). These depend on the demand for Ethereum, which ultimately translates into the token price and fees. Therefore, a strong correlation between the ETH price and revenue is apparent. When the price of the coin fell this year, so did revenues.  Ethereum's protocol revenue may remain low for a long time because the move to Proof-of-Stake (PoS) blockchain has reduced the energy consumption and thus the cost, which for the other side of the transaction is the protocol revenue.  After merge, the token may no longer generate as much revenue as it once did through the current lack of cryptocurrency digging, which absorbed a large part of the cost. In theory, increased demand even with PoS blockchain could translate into increased commissions and network revenue, but it would have to require a gigantic influx of buyers. Ethereum Price, daily candles Source: Conotoxia MT5 Ethereum has been moving in a sideways trend for almost three weeks. Today at 16:00 GMT+3 ETH is losing around 0.3%. Did you know that CFDs allow you to trade on both falling and rising prices? CFDs allow you to open buy and sell positions, and thus invest when quotes rise as well as fall. At Conotoxia, you can choose from CFDs on more than 5,000 financial instruments, including more than 140 CFDs on cryptocurrencies. Wanting to find a CFD on the cryptocurrency of your choice, all you need to do is follow 4 simple steps: To access Trading Universe - a state-of-the-art center for financial, information, investment and social products and services with a single Smart account, register here. Click "Platforms" in the "Invest&Forex" section. Choose one of the accounts: demo or live On the MT5 or cTrader platform, search for the CFD cryptocurrency you are looking for and drag it to the chart window. Use the one-click trading option or open a new order with the right mouse button. Read next: Elon Musk Is Getting Into Geopolitics| Russia And Another Attack| FXMAG.COM Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

It would seem that good data from the US labor market could be a reason for satisfaction, optimism and calming down the already nervous situation on the financial markets. However, this did not happen after Friday's publication, where the stock indices plunged. Good data from the labor market and falls in the US stock market US stock Futures extended losses on Monday, after stronger- than expected US employment data could cause an escape from the stock market. At the end of the US session on Friday, the Dow Jones fell by 2.11 percent, the S&P 500 by 2.8 percent and the Nasdaq Composite by 3.8 percent. Total non-farm payroll employment rose 263,000 in September, the U.S. Department of Labor reported on Friday. This figure was a slight decrease compared to the previous month's increase of 315,000, but it exceeded market expectations. The unemployment rate fell by 0.2 percentage points compared to August and returned to the July reading of 3.5%. The professional activity rate was 62.3%. The leisure and hospitality sector recorded the largest number of new jobs in September (83,000), followed by healthcare (60,000) and professional and business services (46,000), according to BLS data compiled by BBN. Source: Conotoxia MT5, US500, M30 Good data is bad data? The market seems to be returning to the conclusion that good data from the economy may be bad for the financial markets, as it may mean higher interest rates. In an environment where inflation is at its highest in decades and the labor market is strong, the Fed may not have any brakes on these rate hikes. The market is estimating that at the beginning of November the Federal Reserve may decide on another hike by 75 bp. For Wall Street institutions, this could mean a higher cost of capital and could also lead to further deleveraging. Additionally, the valuation of US equities at 16x (forward P / E for the S & P500) seems to be high with the expectation that the US dollar may bear interest at nearly 5%. in a quarter. Additionally, investments in stocks may not be encouraged by the high level of the VIX fear index, which is in the region of 30 points. To sum up, investors in the stock market may receive increasingly expensive financing at higher risk, while at the same time competition in the form of bonds or even deposits in US dollars could literally grow from the meeting to the Fed meeting. What awaits US stock markets this week? This week, in turn, there may be some important data on inflation in the United States. They may also affect the market expectations as to the strength and scale of possible further interest rate hikes in the US. The data will be released on Thursday 10/13/2022 at 2:30 PM GMT + 2. Did you know that CFDs allow you to trade both lows and increases in price? CFDs allow you to open buy and sell positions, and thus invest with both rising and falling quotes. At Conotoxia, you can choose from CFDs and DMA CFDs on over 4,000 stocks of listed companies around the world. If you want to find CFDs or DMA CFDs per share, just follow 4 simple steps: To access Trading Universe - a modern center of financial, information, investment and social products and services with one Smart Account, register here. Click "Platforms" in the "Invest & Forex" section. Choose one of the accounts: demo or live On the MT5 search for the CFD or CFD DMA action you are looking for and drag it to the chart window. Use the one-click trade option or open a new order with the right mouse button. Daniel Kostecki, director of the Polish branch of Conotoxia Ltd. (Cinkciarz.pl investment service) The above commercial publication does not constitute an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of April 16, 2014. It has been prepared for information purposes and should not constitute the basis for making investment decisions. Neither the author of the study nor Conotoxia Ltd. are responsible for investment decisions made on the basis of the information contained in this publication. Copying or reproducing this work without the written consent of Conotoxia Ltd. is prohibited.

In September, the Japanese government and the Japanese central bank intervened in the forex market with the aim of strengthening the yen. Earlier, the USD/JPY exchange rate had rallied close to the JPY 146 per USD level, reaching its highest level since 1998, which worried the Japanese authorities. This morning, the USD/JPY exchange rate approached the levels again, before the intervention. Government intervention to strengthen the Japanese currency Tonight, Japanese Finance Minister Shunichi Suzuki told reporters in Tokyo that the government remains ready to take the necessary responses to excessive currency movements. He added that he would continue to keep a close eye on forex movements, as stability is important and sudden unilateral movements are not desirable. The difference in interest rates between the U.S. and Japan is not the only factor affecting forex movements, there are various factors behind rate changes, Suzuzki added in quotes published by Bloomberg news agency. Last month's intervention had some impact on speculators, the Japanese finance minister pointed out. Japan spent $19.7 billion on the September currency intervention, Bloomberg reported. Source: Conotoxia MT5, USDJPY, H4 Japan's fight over the yen exchange rate and bond yields A cycle of interest rate hikes is underway in developed economies around the world, but not in Japan. The Japanese want to keep interest rates close to zero at all costs, and still want to control their bond yield curve. Investors, on the other hand, probably want to necessarily get rid of as many Japanese bonds as possible, as long as their prices are jacked up by the central bank. As a result, Japanese government bonds rose today after the central bank increased its planned fourth-quarter debt buying. The Bank of Japan announced Friday it would increase its purchases of bonds with maturities above five years in the fourth quarter 2022, Bloomberg reported. USD/JPY technical analysis Source: Conotoxia MT5, USDJPY, D1   In light of possible currency interventions, i.e. factors typically outside the market, the importance of technical analysis may be less. Nevertheless, looking at the USD/JPY chart, we can see a significant expanding wedge formation, where the market seemed to turn around in the area of its upper limit, as well as a rising wedge formation. In addition, the RSI relative strength indicator has retreated from overbought levels, but may be close to drawing a potential divergence. Short-term support may also come from the 20-session average, above which the market was in an earlier trend. Can changes be expected from the Bank of Japan's action? Many people wonder why the Bank of Japan  is not going to  change its monetary policy, as other central banks around the world have changed it, but  would try to buy time with currency interventions. However, there is no clear answer to this question, for believing the BOJ's announcements, this  seems l not changing  soon. According to National Australia Bank analysts, the December forecast for USD/JPY was raised to JPY145 from JPY133. "We are forced to abandon our earlier view that we will see changes in the way the BOJ's interest rate and yield curve control (YCC) policies work this year," - NAB analysts quoted by Bloomberg wrote. BOJ Governor Kuroda has made it clear that the policy stance of unchanged or lower interest rates will be maintained, probably for another two to three years. Did you know that CFDs allow you to trade on both falling and rising prices? Derivatives allow you to open buy and sell positions and thus trade on rising as well as falling quotes. At Conotoxia, you can choose from CFDs on more than 100 currency pairs. For example, if you want to find a CFD on the USD/JPY, you only need to follow 4 simple steps: To access Trading Universe - a state-of-the-art hub of financial, information, investment and social products and services with a single Smart Account, register here. Click "Platforms" in the "Invest&Forex" section. Choose one of the accounts: demo or live On the MT5 or cTrader platform, search for the CFD currency pair you are looking for and drag it into the chart window. Use one-click trading or open a new order with the right mouse button.   Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. Read more on Conotoxia.com

Gold is usually associated with a precious metal that could be used to protect capital in difficult markets and economic times. Undoubtedly, we are facing such an environment in 2022, and gold expressed in U.S. dollars appears to have fallen for the sixth consecutive month. Gold and the foreign exchange market Mostly, when we talk about the price of gold, we talk about it expressed in U.S. dollars, because this is also how the commodity is quoted on global financial markets. The gold price in USD seems to have fallen for the sixth consecutive month, a series not seen since 2018. From its peak in March 2022 to its lowest level in September 2022, the gold price fell by 22 percent. On the Conotoxia MT5 platform, this month's low was set at $1614.80. This was the lowest level since April 2020. Source: Conotoxia MT5, XAUUSD, MN Gold in other currencies Nevertheless, gold in currencies other than the USD seems to have gained this year. This in turn may be due to the fact that these currencies may have lost more to the USD than gold has lost. Gold denominated in the Polish zloty has gained 12 percent since the beginning of the year, while gold in PLN has become 18 percent more expensive in relation to September 2021. Britons, who are also now facing the weakest pound in history, if they had bought gold earlier, may have preserved the purchasing value of their currency. Since the beginning of 2022, the gold rate in British pounds has risen by 10 percent, and on an annual basis by almost 15 percent. And the Japanese, whose currency in relation to the USD was the weakest since the 1990s, can't complain about gold either. There, on an annual basis between September 2021 and September 2022, the price of gold rose by 23 percent. As can be seen from the above, gold in a large part of the world's countries has managed to preserve the value of local money. Only Americans can complain about the current prices of yellow metal. Technical analysis of XAU/USD Source: Conotoxia MT5, XAU/USD, MN From the point of view of technical analysis, the price of gold may have reached potential support. We are talking about the 50% Fibonacci retracement of the upward movement from August 2018. In addition, a potential correction (abc) could have appeared on the chart in 2016-2018. Now in 2020-2022, a correction (abc) could also appear. What may be important for corrective structures is the equality of their formation over time. This equality was reached this month. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

The British pound is slipping nearly 1 percent against the US dollar this morning and is back below the 1.08 level. The dollar, in turn, seems to be strengthening against all major G-10 currencies. The euro is weaker by about 0.7 percent and is quoted at $0.9658 as of 07:54 GMT+3. Read next: Tim Moe (Goldman Sachs) Comments On USD And Turbulent Times For Markets In General, Ole Hansen (Saxo)Talks Nord Stream | FXMAG.COM S&P futures are unchanged, with the Nasdaq slipping 0.2 percent, while Asian stocks are rebounding from two-year lows after Wednesday's rally on Wall Street. The Hang Seng rose 1.2 percent and the Shanghai Composite rose 0.3 percent, Bloomberg reported. During Wednesday's U.S. session, the Dow Jones rallied 1.88 percent, the S&P 500 went up 1.97 percent and the Nasdaq Composite rose 2.05 percent. These moves came after the Bank of England announced it would buy bonds to stabilize financial markets, causing global bond yields to fall, which in turn could support a broad rally in risky assets. Today, however, investors will have to reassess the actions of the British. Bank of England from QT to QE Political tensions are mounting in the UK, with the aim of rolling back the announced tax changes. These have yet to take effect, and in fact have led to a collapse in the British financial market, especially the bond market. The British, with their decisions, came close to causing the collapse of their pension funds through a sharp drop in bond prices. Only the intervention of the Bank of England stabilized the situation. The Bank of England announced Wednesday that it had bought £1.03 billion worth of UK government bonds. The bank received bids to buy gilts worth a total of £2.59 billion. The BoE specified that it would buy "gilts with a residual maturity of more than 20 years in the secondary market. The bond-buying program, funded by the central bank's reserves, will last until October 14, BBN reported. In addition, the UK government has received a clear warning from the IMF and rating agencies that it is not welcome to loosen fiscal policy, and temporarily monetary policy as well, at a time when the global battle against inflation is underway. The political and financial drama in the UK seems therefore ongoing, and its next chapters are yet to be written. Source: Conotoxia MT5, GBPUSD, H1 Dollar stronger again The US currency may be helped by further statements from representatives of the US Federal Reserve. They may be making it clear that no Fed pivot is in question at the moment. Federal Reserve Bank of Chicago President Charles Evans said on Wednesday that the interest rate should reach its peak in March 2023. Saying that the Fed should have started raising rates earlier is "fair," he also noted at an event organized by the London School of Economics. The central bank could have chosen to start earlier by raising interest rates in small steps over a long period of time, or it could have chosen to do what it ultimately did, which was to introduce higher rates more quickly as soon as inflation surged, he explained. The Fed's analysis at the time indicated that the outcome of the two policies would not have been "significantly different," Evans added. Source: Conotoxia MT5, USDIndex, H4 Did you know that CFDs allow you to trade on both falling and rising prices? Derivatives allow you to open buy and sell positions, and thus invest with both rising and falling quotes. At Conotoxia, you can choose from CFDs on more than 100 currency pairs.For example, if you Want to find a CFD on GBP/USD, you just need to follow 4 simple steps: To access Trading Universe - a state-of-the-art center for financial, information, investment and social products and services through a single Smart account, register here. Click "Platforms" in the "Invest&Forex" section. Choose one of the accounts: demo or live On the MT5 or cTrader platform, search for the CFD currency pair you are looking for and drag it to the chart window. Use the one-click trading option or open a new order with the right mouse button. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

Stock index contracts are falling today as consumer sentiment declines. This time it's consumers from Europe's largest economy, Germany, where a record of pessimism has been set. Sentiment in Germany vs. DAX quotes Germany's GfK consumer climate index fell to -42.5 in October 2022 from -36.8 the previous month, reaching a new record low. This is the fourth consecutive decline, which was worse than market forecasts had predicted. The latest reading highlighted growing concerns over rising inflation and high energy prices, as well as persistent fears of recession, with income expectations falling to a new record low (down 22.4 points to -67.7), according to data released by GfK Group. Economic expectations also fell 4.3 points to -21.9, reaching their lowest level since May 2009. Meanwhile, willingness to buy fell 2.8 points to -19.5, the lowest level since October 2008, marking the eighth consecutive month of declines. "The current very high inflation rate of almost eight percent is leading to large losses in real income among consumers, and thus a significant reduction in purchasing power," - Rolf Bürkl, GfK consumer expert, said. Source: Conotoxia MT5, DE40, H4 With sentiment weakening, but also with increasing chances of further interest rate hikes whether in the United States or the Eurozone, as well as a perceived energy crisis looming this winter, the German DAX index's stock price has set new local lows. At 10:19 GMT+3, the DE40 was down 1.15 percent and at its lowest level since November 2020. That's when the markets were hit by the autumn wave of the covid outbreak, and moments later a new upward wave followed with news of a successful vaccine. Then the bottom was established in the 11500 point area, and it seems that it could be a potential support for DE40. London Stock Exchange quotes It is impossible not to mention the UK stock market, which seemed to defend itself from declines for a long time. Now, however, the FTSE100 index, too, may be heading south. The UK100 instrument on the Conotoxia MT5 platform is down 1 percent to 6898 points as of 10:23 GMT+3. This week, Britain's main index hit its lowest level since March 2022. Source: Conotoxia MT5, UK100, W1 The London Stock Exchange appears to be under pressure from lingering concerns about the country's economic outlook, exacerbated by a lack of commitment to fiscal discipline. The budget plan of the UK's new finance minister Kwasi Kwarteng, which includes historic tax cuts and a massive increase in debt, has been met with strong opposition from the International Monetary Fund and the Moody's rating agency. If it is implemented, it is possible that the UK could experience a rating cut. Did you know that CFDs allow you to trade on both falling and rising prices? Derivatives make it possible to open buy and sell positions and thus trade on both rising and falling quotes. At Conotoxia, you can choose from CFDs and DMA CFDs on more than 4,000 shares of companies listed on stock exchanges from all over the world. To find a CFD or DMA CFD on a stock, all you need to do is follow 4 simple steps: To access Trading Universe - a state-of-the-art hub of financial, information, investment and social products and services with a single Smart account, register here. Click "Platforms" in the "Invest&Forex" section.Choose one of the accounts: demo or live On the MT5 platform, search for the CFD action you are looking for and drag it into the chart window. Use the one-click trading option or open a new order with the right mouse button. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. Stock market news: Worse consumer sentiment and poor stock market sentiment (conotoxia.com)

You can't complain about volatility lately, looking at the traditional financial markets. Both stock indexes and currencies may have seen increased volatility, not to mention the bond market. Bitcoin to the dollar It would seem that a dollar hitting consecutive 20-year peaks, indexes deepening the bottom of a bear market, or rampant bond yields would be an environment in which cryptocurrencies could significantly fall. For the moment, however, this has not happened. On the contrary, despite the downswing in stock markets and a more expensive dollar or higher bond yields than at least a week ago, bitcoin seems to be gaining against the USD. Can the world's largest cryptocurrency provide an alternative in these times? Source: Conotoxia MT5, BTCUSD, H4 Bitcoin an alternative in a currency crisis? Since the beginning of this year, the Japanese yen and the British pound have lost more than 20 percent against the U.S. dollar. The euro has lost more than 15 percent against the USD, and the New Zealand dollar more than 16 percent. We are talking about some of the world's most important currencies and a period of less than 10 months. In the long term, the losses of individual currencies seem to be even greater. From this perspective, the market is beginning to talk about a possible currency crisis, as well as new resolutions, or an increase in the chances of joint intervention against the strength of the USD. Whether this would happen is a separate topic, but if the major currencies are losing value so significantly, the question is whether bitcoin will be able to play the role of an asset, to store the value of money over time. Additionally, Americans may have an even bigger problem than other countries. While investors from Europe or Asia were able to buy USD with their local currency and could possibly benefit from a change in the exchange rate, Americans seem that they did not have such an opportunity. U.S. investors, what they would touch this year, they could lose on. Foreign currencies against the USD weakened, the stock market fell, together with bonds and gold in USD. There seems to be no place where, owning dollars and being in the US, someone could store capital so that it is not devoured by inflation (except for short positions in the aforementioned markets). While this is a far-fetched thesis, it is worth recalling that bitcoin could have been a response to the ineptitude of government, supervision and the central bank, leading the US economy to collapse through the real estate crisis. Today, citizens' wealth may also be at risk. Inflation, high interest rates (but not so high that they yield interest over inflation), an economic slowdown or recession, or poor prospects for recovery. Perhaps when the situation is already very bad in the markets and in the economy (according to forecasts, this could be the case in 2023), bitcoin could attract capital to store it over time, because here the rules about money creation are very clear and known in advance for decades ahead, unlike the actions of central banks. Did you know that CFDs allow you to trade on both falling and rising prices? CFDs allow you to open buy and sell positions, and thus invest when quotes rise as well as fall. At Conotoxia, you can choose from CFDs on more than 5,000 financial instruments, including more than 140 CFDs on cryptocurrencies. Wanting to find a CFD on the cryptocurrency of your choice, all you need to do is follow 4 simple steps: To access Trading Universe - a state-of-the-art center for financial, information, investment and social products and services with a single Smart account, register here. Click "Platforms" in the "Invest&Forex" section. Choose one of the accounts: demo or live On the MT5 or cTrader platform, search for the CFD cryptocurrency you are looking for and drag it to the chart window. Use the one-click trading option or open a new order with the right mouse button. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. Read more on Conotoxia

The end of last week and the beginning of this week have been a veritable rollercoaster in the financial markets. The volatility experienced by the currencies of developed countries during this time, especially the British pound, could be compared to the period of the Great Financial Crisis, the Brexit referendum or the pandemic hitting the financial markets. Current overview of financial markets Today, financial markets seem to be trying to catch their breath after the recent turmoil. The U.S. dollar seems to be slightly losing value in the broad market, which may also be caused by the phenomenon of profit realization from sudden dollar trends. As of 09:300 GMT+3 on the Conotoxia MT5 platform, the EUR/USD was up 0.57 percent to $0.9663 today. The GBP/USD rallied 1.3 percent to $1.0821, while bitcoin returned above the $20000 level, rising just under 6 percent. Stock index contracts also rebounded. The DAX rose less than 1.5 percent to 1,377 points, and the S&P500 rose 1.48 percent to 3704 points. The dollar index, on the other hand, retreated 0.65 percent to 113.57 points. It had earlier set a new peak in a multi-month trend above 114.60 points. Source: Conotoxia MT5, USDIndex, H4 Financial markets race to peak interest rates The market at present, seems to be outdoing itself in betting on which level and country would peak in interest rates. The British pound may come out on top due to the fact that the Bank of England might be forced to counter the British government's fiscal easing and may raise interest rates faster and more than previously expected. Currently, the market is assuming that interest rates in the UK could rise as much as 175 bps and only until November, while the market sees the peak of the cycle in the region of 6%. Meanwhile, in the US, the interest rate market is assuming that the Fed funds rate range could reach its peak in February 2023. This could be between 4.5 and 4.75 percent. Thus, the U.S. bond market may also be close to the full discount of hikes, as yields on 2-year bonds reached 4.3 percent yesterday. In the Eurozone, on the other hand, the EUR could be above 3 percent in six months. Thus, lower than the pound and the dollar, while higher than the Japanese yen. For the JPY, interest rates are expected to remain unchanged over the year, according to the market's valuation of interest rate levels. Source: Conotoxia MT5, GBP/USD, m30 What's next for the British pound? According to Citigroup, parity on GBP/USD looks "quite likely," as there are no clear valuation thresholds for the pound, but "I still wouldn't go so far as to say it's inevitable," Ebrahim Rahbari, global head of FX analysis at Citigroup, said on Bloomberg TV. "We are looking at parity as the next big level," he added. While conventional valuation suggests that sterling doesn't need to get much weaker, "it's really that risk premium that comes with some of the policy measures that makes it so likely that we'll drift, perhaps beyond parity." Currency troubles are unlikely to escalate into a crisis, he said, because the UK doesn't have much debt denominated in foreign currencies. He added that: "The threat of default is much less significant." Meanwhile, Morgan Stanley has revised its forecast for the pound and now sees it reaching parity with the dollar by the end of the year, as neither currency interventions nor emergency rate hikes by the Bank of England will stop the sterling's weakening. "Recent price action suggests that the GBP is under pressure," - Morgan Stanley analysts wrote in a Monday note. The bank's previous forecast for GBP/USD was 1.02. It is now 1.00. The analysts also revised their forecast for EUR/GBP to 0.9500 by year-end from 0.9100 previously. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. Read article on Conotoxia: Stock market news: The financial market tries to take a breather. What's happening to the pound? (conotoxia.com)

Probably the events of Friday 23.09.2022 and Monday 26.09 will go down in history. History that is unfortunately not glorious for the UK and the British pound Tonight, the British currency against the U.S. dollar (GBP/USD) was the cheapest on record, falling below the 1.0500 level. Read next: The Statement By Elon Musk About Starlink May Cause Confusion | Leaders Must Take Action To Protect The Environment | FXMAG.COM The consequence of UK tax changes against the British pound Proposals for tax changes in the UK, which are expected to introduce the most significant fiscal stimulus package since 1972, emerged on Friday. As Bloomberg reported, sterling fell as much as 4.7 percent tonight and hit a record low against the dollar, after Kwasi Kwarteng signaled that more tax cuts are coming. Britain's Chancellor of the Exchequer told the BBC on Sunday: "There are more tax cuts on the horizon. I want to see over the next year that people keep more of their income because I believe it is the British people who will drive this economy." Source: Conotoxia MT5, GBPUSD, MN Is this why the pound is losing on tax cuts? First, the UK economy has been hit by high inflation, which the Bank of England believes could remain above 10% for several more months. Second, the Bank of England is planning or already planned to sell bonds on the market to draw down money, thus further tightening monetary policy, in order to fight inflation. Third, cutting taxes reduces revenue to the budget, which could usually be replenished by selling bonds to investors. Fourth, less taxes could mean more money in the pockets of Britons in an era of rampant inflation. In summary, the current measures could lead to a huge supply of debt (the higher the supply, the usually lower the price, the higher the interest rate on bonds), higher costs of servicing it and a harder fight against inflation. This, in turn, could force the Bank of England to make further increases, and these could push the economy into recession. All of this could reflect a loss of foreign investor confidence in the UK government, with politicians working against the Bank of England. As of today, the market is pricing in the possibility of a 150bp interest rate hike in two months, while in a year the main interest rate could rise as high as 6 percent. Now not just to fight inflation, but to encourage investors. With such action, it is not difficult for the situation to get out of hand and lead to a kind of spiral that is difficult to stop. Nevertheless, the political actions of the British authorities may lead to such a spiral at this point. According to the market, the chances of GBP parity against the USD later this year are growing. Did you know that CFDs allow you to trade on both falling and rising prices? Derivatives allow you to open buy and sell positions, and thus invest with both rising and falling quotes. At Conotoxia, you can choose from CFDs on more than 100 currency pairs.For example, if you Want to find a CFD on GBP/USD, you just need to follow 4 simple steps: To access Trading Universe - a state-of-the-art center for financial, information, investment and social products and services through a single Smart account, register here. Click "Platforms" in the "Invest&Forex" section. Choose one of the accounts: demo or live On the MT5 or cTrader platform, search for the CFD currency pair you are looking for and drag it to the chart window. Use the one-click trading option or open a new order with the right mouse button. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. Read article on Conotoxia

The Japanese government has decided to intervene with currency intervention in the Japanese yen market after the USD/JPY exchange rate approached the 146.00 level following an earlier Fed decision. The Japanese currency had been losing steadily since the beginning of the year with the divergence in the actions of the US and Japanese central banks. Bank's Of Japan Intervention The Japanese government and the Bank of Japan (BoJ) intervened on Thursday in the foreign exchange market for the first time since 1998, when the U.S. dollar reached a 24-year peak against the yen. Japanese Deputy Finance Minister for International Affairs Masato Kanda confirmed that the government responded by selling dollars against yen. Kanda added that "markets are making very volatile moves" and that Japan "cannot tolerate excessive volatility and disorderly currency movements." Earlier in the day, the BoJ decided to leave its interest rate unchanged and continue its loose monetary policy, BBN reported. Source: Conotoxia MT5, USD/JPY, H1 How lasting could the effects of intervention on the JPY be? For the time being, investors may be wondering how lasting the effects of Japan's, for the time being, one-time intervention in the currency market may be. The drop from around JPY 146.00 to JPY 140.50 may undoubtedly be impressive, but will it be able to halt USD appreciation, which may be driven by growing expectations of rate hikes in the US? Read next: Jim Cramer Comments On Inflation, IMF (International Monetary Funds) Talks Stablecoins | FXMAG.COM According to analysts quoted by Bloomberg, the Japanese yen could rebound to 130-135 per dollar if the authorities push ahead with more interventions in the foreign exchange market. The scale of intervention was still small relative to total foreign exchange reserves, so there is still some ammunition to defend the currency." - Saktiandi Supaat, regional head of foreign exchange market research, told Bloomberg TV. He notes that USD/JPY could head toward JPY130 or JPY135 if authorities push harder for further intervention. However, the baseline scenario assumes support for the dollar through the end of the year and perhaps into the first quarter of 2023. The dollar could weaken in the event of any signs of a Fed slowdown or positive developments around Russia/Ukraine, which could lead to a reduction in risk-off sentiment, the Bloomberg interview added. USD/JPY technical situation From the point of view of the USD/JPY exchange rate chart, we can see that the quotes are still inside a potential expanding wedge formation. In addition, the potential resistance level and the contractual limit for currency interventions at JPY 145.00 may also have been defended. The short-term line drawn after the lows was also broken. As a result, the rate could start consolidating in the range of JPY 145.00 to 141.50. Further potential support could fall in the area of previous peaks at JPY 139.00, and then at the lower boundary in the wedge. Source: Conotoxia MT5, USD/JPY, D1 Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

Today, U.S. stock index contracts seem to indicate the possibility of a cash market opening on the downside. Investors may be estimating the possibility of Fed action, and not just this week, but for the rest of the year. Currently, the market may believe that the Federal Reserve will not end the cycle of hikes below the 4 percent level, but above it. This could put pressure on company valuations on Wall Street. Have low-interest rates helped the Wall Street stock market? Since 2008, the US stock market has been able to enjoy the ongoing bull market that followed the Great Financial Crisis. Back then, both the financial markets and the economy were supported by very low-interest rates or asset purchase programs. From 2008 until the beginning of 2022, the average federal funds rate was 0.58 percent, and the average price-to-earnings P/E ratio for the entire S&P 500 index had a value of 25. Currently, the P/E for the S&P 500 is 21.49, according to wsj.com, and the federal funds rate rose to 2.33 percent in September. The market, in turn, seems to expect that it could rise above 4 percent in the next two quarters. Source: Conotoxia MT5, US500, W1 Current valuations on Wall Street According to data from wsj.com, the forward P/E ratio, which is the one showing the future earnings of companies in relation to the current stock price, is 17.48 for the S&P 500, while the Nasdaq 100 has a value of 22.57. The current values are 21.49 and 24.97, respectively. This may mean that the market expects that the earnings of U.S. companies may increase next year, which may be good news, but on the other hand, interest rates may rise at the same time. This, in turn, could have a negative impact on company valuations and could cause rates to potentially be lower than they were during a period of low-interest rates. If investors can choose between the U.S. dollar soon at 4.5 percent interest, or riskier stocks with a P/E ratio of 17, it seems that some of them may choose the U.S. dollar over stocks and thus demand for them may be lower. Another group of investors, on the other hand, may forgo risk in favor of safety until valuations become more attractive relative to interest rate levels. This, in turn,  could  happen in one of two ways, either U.S. companies will begin to rapidly expand earnings (which may be difficult in an environment of a slowing economy) or stock prices will find lower levels. Forecasts for the S&P500 at the end of 2022 According to analysts surveyed by Reuters, the S&P 500 could end this year at 4280 points. This is the median forecast of nearly 50 strategists surveyed by Reuters in the second half of August 2022. The median forecast for 2022 is down from 4400 points in a Reuters survey conducted in late May. Survey respondents, therefore, seem to be optimistic about the index's year-end result after all. This could mean a return to the peaks of August this year.   Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. Are valuations on Wall Street currently attractive? (conotoxia.com)

This could be a very exciting week in the financial markets, as investors will first await and then react to the central banks' interest rate decisions. The US Federal Reserve's decision may come to the forefront. On Monday morning, the U.S. dollar appears to be continuing last week's strengthening, perhaps due to investors' bias toward safer assets and because of a likely hawkish 75 basis point rate hike by the Federal Reserve. The Fed will usher in a series of central bank decisions in the coming days, according to scheduled publications on the macroeconomic calendar. Dollar back on upward wave The U.S. Dollar Index rose 0.23 percent today to 109.92 points as of 07:52 GMT+3 on the Conotoxia MT5 platform, after gaining 0.8 percent at the close of last week. The EUR/USD pair's exchange rate fell 0.26 percent as of the time described, and was again below parity ($0.9984). The dollar may gain in anticipation of a US interest rate hike as early as this Wednesday, September 21, where the FOMC macroeconomic projections will also be released. Here, the market may set its sights on presenting a target range in the current cycle above 4 percent (the end of the cycle was previously estimated to be below 4 percent). Source: Conotoxia MT5, USDIndex, D1 Bank of England and Bank of Japan - what is the situation on GBP and JPY? In addition to the U.S. Federal Reserve's decision, we will also learn about the decision of the Bank of England and the Bank of Japan. On Thursday, interest rates in the UK may rise by 0.5 percentage points, to 2.25%, this is the market consensus. The GBP/USD pair, after Friday's decline, is below $1.14 this morning at 08:02 GMT+3. Thus, the pound's exchange rate against the US dollar is the lowest since the 1980s. Source: Conotoxia MT5, GBP/USD, D1 Meanwhile, the Bank of Japan, although inflation remains above the 2% level, it seems  unlikely to decide to tighten monetary policy. As a result, the country may still remain in opposition to other developed economies, where an interest rate hike cycle is underway. This could continue to put pressure on the Japanese yen, which in turn could put pressure on Japanese politicians and policymakers, who may continue to debate possible market intervention. However, it is implied that only a change in the BoJ's approach could affect the yen more. When is the Fed's decision on rates? In summary, the Fed's decision will take place at 20:00 GMT+3 on September 21 (Wednesday), the Bank of Japan's on Thursday night, September 22 (the exact time is not scheduled), and the Bank of England's at 13:00 on the same day. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

The UK economy, including the British pound's quotations, has had a very turbulent year. The authority of the British currency may have first been undermined by the exit from the European Union, and then the British economy suffered a blow from a pandemic. The British Isles' severe energy crisis and high inflation may be adding to this. Read next: China Positive Reports,Drop In Retail Sales, Waiting For European CPI| FXMAG.COM Since the beginning of this year, the British pound has lost more than 15 percent of its value against the U.S. dollar. This makes the GBP the second weakest of the world's major currencies, just after the Japanese yen, losing more than 19 percent. In addition, if someone was taking the 2014’s peak as a reference point, the GBP's loss against the USD could reach more than 30 percent. As a result, the market has reached levels last seen in 1985. Source: Conotoxia MT5, GBP/USD, MN The British pound after a rough ride Observed in the chart above, the two significant lows in the region of $1.1400 were first the impact of brexit on GBP quotes, and the second was the impact of the pandemic. Currently, this level seems to be tested for the third time. Today, further disappointing data from the British economy may have contributed to the pound's weakness.  The volume of UK retail sales in August fell 1.6 percent from the previous month, the Office for National Statistics reported on Friday. The regression was larger than analysts had expected. Sales fell on a monthly basis for the first time since July 2021.  Non-food store sales slid 1.9 percent month-on-month, auto fuel sales fell 1.7 percent and grocery store sales were 0.8 percent lower, according to the data, which is summarized by BBN's website. As a result of weakening consumer demand and thus possibly the overall British economy, investors seem abandoning the GBP, which this morning is at its weakest since the 1980s against the USD. Rate hikes are not helping the GBP Expectations of interest rate hikes in the UK at this point also do not seem to be helping the pound. Some analysts note that even the GBP is moving like an emerging market currency. These could be characterized by the fact that the higher the investment risk, the lower the exchange rate, despite interest rate hikes. While interest rates in the UK may be higher than in the US over time, investors seem to be turning away from the pound anyway. It seems that under these circumstances, the British currency might have a hard time regaining investor confidence.   Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. Read article on Conotoxia.com

On Thursday, financial markets seem to be characterized by less volatility than in the first half of the week. Investors may continue to delve into the Fed's latest actions after the latest inflation reading from the U.S. and ponder how any rate hikes could affect stock, bond, dollar or cryptocurrency quotes. Situation in the markets and mixed data from the Antipodes This morning, the DAX was up 0.17 percent at 6:52 a.m. CET, while the CAC 40 was unchanged from its previous day's position at the same time. The FTSE 100 rose 0.49 percent. The euro fell 0.13 percent against the dollar to 0.99680 at 7:06 a.m. CET, while the pound lost 0.17 percent against the U.S. dollar to 1.15204. From macroeconomic data overnight, we learned that unemployment in Australia unexpectedly rose to 3.5 percent in August from 3.4 percent, the first increase in 10 months. This result may support the Reserve Bank of Australia's earlier signal of a potential move to smaller interest rate hikes. New Zealand's economy, on the other hand, grew more than expected in the second quarter (0.4 percent year-on-year), avoiding recession after a surge in Covid-19 cases caused the economy to contract in the first three months of the year. Read next: China May Need Less Crude Oil - IEA Report Finds. The European Union Considers Limitations On Power Demand| FXMAG.COM Source: Conotoxia MT5, AUDUSD, D1 The Ethereum Merge The world's two largest cryptocurrencies, bitcoin (BTC) and ether (ETH), fell on Thursday after the ethereum exchange rate earlier posted an intraday gain of more than 4 percent. This time, the second-largest cryptocurrency fell more than 2 percent, with the entire cryptocurrency community expecting a transition to a proof-of-stake model with proof-of-work (known as The Merge) to take place in the next few hours, BBH reported. The years-long, system-wide upgrade of the ethereum blockchain will mark one of the most historic events in the cryptocurrency sector, according to CNBC. Katie Talati, head of research at asset management firm Arca, said in an interview with CNBC: "we believe that after The Merge Eth bullish sentiment towards ethereum will be much stronger for a number of reasons." The main factor is expected to be a decrease in supply, which will make ETH a more scarce and harder-to-access token, which could translate into price, Talati added. Source: Conotoxia MT5, ETH/USD, D1 Merge ETH, and what's next for BTC? From the point of view of the chart of the world's largest cryptocurrency, the price of BTC remains in a fluctuating range between $18343 - $25016. In addition, in recent times, the BTC/USD exchange rate may be capped by the trend line drawn after previous peaks. It seems that only overcoming this place could be more favorable for the bulls. In turn, overcoming the support could open the way towards $12582. Source: Conotoxia MT5, BTC/USD, W1 Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. Read article on Conotoxia.com

Yesterday's presentation of inflation data in the United States shook financial markets. Investors, looking by the reaction in many markets, seemed to expect inflation to fall faster than the estimation presented. The markets were shaken. US inflation - a powerful blow to financial markets The August consumer price index report showed that inflation rose 0.1 percent on a monthly basis, despite forecasts for a 0.1 percent decline, while the annual rate of consumer inflation fell less than expected in August to 8.3 percent (consensus 8.1 percent). The higher-than-expected U.S. inflation reading and slower pace of decline may have given rise to speculation that the Fed may deliver a larger interest rate hike than 75 bps. The game may now be on for a 100 bp hike next week. Read next: Great Britain’s CPI Lower Than The Expected, Eyes On US PPI| FXMAG.COM At the end of Tuesday's session, the Dow Jones index was down 3.94 percent, the S&P 500 down 4.32 percent, and the Nasdaq Composite down 5.16 percent. All three major indexes broke a four-day streak of gains and posted their biggest one-day decline in more than two years. All sectors in the S&P index ended the session in negative territory, with communications services, technology and consumer products falling more than 5 percent.  Bitcoin had already fallen at one point, in a move initiated after the US data, to levels below $20000. This could mean a drop of more than 10 percent. The EUR/USD pair price, in turn, retreated below parity, recording a cumulative drop of more than 2 percent after the data. Such large changes in many markets could be fears of faster and larger interest rate hikes in the US. Source: Conotoxia MT5, US100 m30 How is the Fed's action priced in? According to the interest rate market, the chances of a 100bp hike on September 21 have risen to 34 percent. Previously, the market had not considered such a large US interest rate hike at all, and was considering a rate hike between 50 and 75 bp. The current pricing could lead to an increase in the range for the federal funds rate to between 3.25 and 3.5 percent, which in turn could mean that the market is pricing the end of the hike cycle no longer in the 3.9 percent region, but in the 4.2 percent region, which could also contribute to the strengthening of the USD. In the bond market, on the other hand, the yield on 2-year U.S. Treasury securities rose to its highest level since 2007, exceeding 3.7 percent. In the past, the level of 2-year bonds may have coincided with the target level of the federal funds rate for the hike cycle. Source: Conotoxia MT5, USDIndex D1 Yen struggles against dollar strength It seems that this morning only the Japanese yen is trying to fight the strength of the USD. This  might have to do with further news of possible intervention. Japan's Finance Minister Shunichi Suzuki said on Wednesday that currency intervention is among the options to combat the decline of the country's currency, the BBN news service reported.  "We are talking about taking all available options, so it is right to think that way," he said. - Suzuki told reporters after being asked if currency intervention in the form of yen buying was on the table. "Recent moves have been quick and one-sided, and we are very concerned. If such moves continue, we must respond, and we are not ruling out any options." - He added. A break of the 145 level by USD/JPY would   lead to intervention by Japanese authorities, David Forrester, senior FX strategist at Credit Agricole CIB, told Bloomberg. The problem facing the Ministry of Finance in the event of any FX intervention is that the upward movement of USD/JPY reflects the divergence between the Fed and BOJ, so the impact of any intervention would only be temporary, the Credit Agricole representative added. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

In a nutshell, investors in the stock market can divide companies into two baskets. One is "growth," or growth-type companies, and the other is "value," or companies with value. The former are, for example, start-ups that currently may not even have their own equipment in the office, but are leasing it, but promise investors that they will make "amazing" profits in a few years. Their valuations, despite their current lack of much value can be very high, because they can be driven by expectations. The second group, value companies, usually do not promise investors hundreds of percent earnings growth, while they have an established business, can pay regular dividends or conduct systematic process restructuring to raise margins. Source: Conotoxia MT5, NOBL ProShares S&P 500 Dividend Aristocrats ETF. Solid value and dividend companies will attract investors? According to Goldman Sachs in a note quoted by Bloomberg, stocks of high fundamental quality, value stocks, dividend-paying companies and companies with exposure primarily to drawing income from the U.S. market are four areas that could drive performance through the end of the year, according to analysts from Goldman Sachs. "Rising cost of capital will limit valuation expansion and prompt investors to reward companies with high-quality fundamental metrics." - analysts led by David Kostin wrote in a note. As an example, they give a quality basket of 50 companies created by Goldman Sachs, which includes stocks that are highly rated for a mix of strong balance sheets, stable sales and earnings growth, above-average return on equity and low historical downside risk.  Companies included in the Goldman Sachs index basket The basket includes Alphabet, Pool Corp., Church & Dwight, Coterra Energy, First Republic Bank and American Tower, among others - CFDs and DMAs on shares of these companies can be found on the Conotoxia MT5 platform. According to Goldman Sachs analysts, value stocks could outperform if the Fed would succeed and inflation would soon peak, and the companies' dividends could offer "exposure to the fundamental growth of the S&P 500 while minimizing exposure to equity valuation risk." Source: Conotoxia MT5, DVY iShares Select Dividend ETF Meanwhile, companies with domestic sales in the U.S. have outperformed those with more exposure to foreign sales, particularly in Europe and emerging markets. The economic situation in Europe is dire, and despite concerns about the U.S. equity market, "it offers greater potential for absolute and risk-adjusted returns than the recession-ridden European markets" - write the GS analysts. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. Source: Value and dividend companies with potential (conotoxia.com)

The euro this morning is the strongest of the world's major currencies, gaining nearly 0.5 percent against the USD. The main currency pair's exchange rate is still above parity and has reached its highest level in three weeks. EUR/USD with a chance for a bigger rebound? The struggle with the parity level of 1.0000 on the EUR/USD pair has been going on for quite some time. The rate seems to oscillate around this level, finding itself once above and once below this "psychological" barrier. Nevertheless, there may now be chances that the euro may be preparing for a bigger rebound. On the one hand, this may be supported by expectations of monetary tightening in the Eurozone, and on the other by the Ukrainian military offensive and its effective retaliation.  As the British Defense Ministry reported on Monday, Moscow is believed to have ordered the withdrawal of its military forces from the Kharkiv region, leading Ukraine to regain control of some territories. Near the city of Kherson, the latest intelligence briefing noted that Russia is having difficulty bringing reserves to the front line across the Dnieper River using improvised bridges, while Ukraine continues to shell the area with long-range artillery. Due to recent developments, confidence in the Russian military command will continue to decline, the British report concluded, BBN/ND mentioned. Source: Conotoxia MT5, EUR/USD H1 The gap between the USD and Euro advantage seems narrowing From the point of view of the interest rate market, the difference in the expected interest rate of the US dollar and the euro in the future also seems to be narrowing - as FRA contract quotes may indicate.  In addition, the gap between the 2-year USD and EUR interest rates has narrowed to levels last seen in early March, when the EUR/USD rose toward 1.10, Bloomberg commentators note. So it seems that this may be changing the outlook in the forex market from a one-sided view that everything may depend only on Fed action to a more balanced view in which the ECB may play a more prominent role. Perhaps the impact of this has not yet been fully priced in, and could result in EUR/USD possibly having a chance to make up some of its losses after Russia's invasion of Ukraine. EUR/USD has finished forming an accumulation? From the point of view of the chart, we can go back to the events of late August. At that time, the EUR/USD fell to the area of 0.9900 and consolidated in the region of 1.0000 - 0.9900 for many days. This could have led to the emergence of a potential accumulation in a relatively small range of fluctuations. Instead, it could culminate in a move toward 0.9850, where the euro fell to its lowest level in 20 years, which happened in early September. Then there could have been a so-called spring and a test of supply. The ensuing upward wave, in turn, is a possible "show of strength."  At stake now could be a sustained hold above 1,0000 and the overcoming of the downward trend line, the beginning of which was already set six months ago, in March. Source: Conotoxia MT5, EUR/USD D1 What else is the EUR/USD likely to react to this week? In addition to events from the war front and statements from central bankers, US inflation data may also be important. According to market consensus, inflation may fall to 8.1 percent in August from 8.5 percent in July and 9.1 in June. On the one hand, a deeper drop in inflation could be more positive for risky assets, while an above-consensus reading could continue to support the dollar, and the current weakness could be considered a correction.   Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service)   Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. Source: Euro gains strength with Ukrainian military offensive? (conotoxia.com)

Shopify is a complete commerce platform for starting, growing and managing a business in the e-commerce sector As the company states on its website, Shopify unifies all of your commerce onto a single platform. With Shopify, merchants can build and customize an online store and sell their products in multiple places, including on the website, on mobile devices, in person, in desktop and pop-up stores, and across multiple channels, from social media to online marketplaces. The company is headquartered in Ottawa, Ontario, Canada, and shares are listed on the NYSE. Staff changes with an impact on Shopify's share price? Shopify shares rose 3.1 percent Thursday, possibly after the company appointed Jeff Hoffmeister, a managing director at Morgan Stanley, as the company's chief financial officer (CFO), replacing Amy Shapero. Shapero will step down after the company announces its financial results for the third quarter of 2022 on October 27, Bloomberg reported. In addition, the company said that Vice President of Product Kaz Nejatian has been promoted to Chief Operating Officer, effective immediately, replacing Toby Shannan, who is retiring and is expected to join Shopify's board. According to MacroTrends, Shopify's revenue for the quarter ended June 30, 2022 was $1.295 billion, up 15.69 percent year-on-year. In contrast, Shopify's revenue for the twelve months ended June 30, 2022 was $5.002 billion, up 29.82 percent year-on-year. In contrast, Shopify's operating income for the quarter ended June 30, 2022 was negative at -$0.190 billion, and operating income for the twelve months ended June 30, 2022 was -$0.278 billion. Shopify's share price tries to bounce off the bottom As recently as November 2021, the shares were trading above $160, where in early 2019 it was paying $13. The company seemed to gain on a wave of strong demand for e-commerce services during the pandemic, and may now be struggling as the economy returns to a new reality and consumer demand is eroded by rising living costs. Yesterday at the close, the stock price was at $31.93, attempting a comeback from its lowest levels since 2019. Source: Conotoxia MT5, Shopify.cfd, H1 What does Wall Street say about Shopify's changes? Bloomberg Agency quotes Wall Street analysts' statements as follows: Barclays with a $30 price target on Shopify: the news comes as a bit of a surprise. Investors are already struggling with how to think about earnings growth, and the management changes add to that uncertainty. Citi with a target price of $36: the news is particularly surprising, given that the new CFO's experience "doesn't seem like an obvious choice," but "could point to potentially more M&A and financial discipline in the future." Baird with a $47 price target: the changes "should not be too disruptive" and reflect "new challenges and opportunities for Shopify, and perhaps the use of other skills in the next stages of growth." Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Changes in Shopify's management team - how did they affect the stock price? (conotoxia.com)

The Japanese currency against the US dollar is the weakest of the main world currencies in 2022, having lost more than 20% in the last 12 months. As a result of such a strong drop, the USD/JPY pair's quotations have reached their highest level since 1998. This year, the yen intervention took place, which the market may again fear. The severity of the yen's drop may have been due to divergence in the Bank of Japan's monetary policy toward the world's other main central banks. The Fed raises interest rates, the ECB does, and the Bank of England or the Bank of Australia also raise interest rates. Meanwhile, the Bank of Japan continues to loosen monetary policy and keep market interest rates close to zero, also applying yield curve control. Nevertheless, the recent slump in the Japanese currency may have started to cause concern among Japanese policymakers and decision-makers. Source: Conotoxia MT5, USD/JPY, MN Japanese authorities are concerned about JPY weakness Japan's Vice Minister of Finance for International Affairs Masato Kanda said on Thursday that the government is "extremely concerned" about the yen after it weakened to levels seen 24 years ago. Kanda pointed out the recent "speculative, one-sided sharp movements of the yen", reasoning that the currency's decline cannot be explained simply by looking at the fundamentals and describing it as "excessive volatility". He assured that the government was coordinating actions with other countries, including the United States, adding that the government was ready to act on the currency market and was not ruling out any course of action, as reported by BBN/DJ. In addition, there has already been a meeting between Bank of Japan Governor Haruhiko Kuroda and Prime Minister Fumio Kishida, which may also have raised concerns among foreign investors. Technical situation - USD/JPY From a charting point of view, the USD/JPY pair's price has reached a potential resistance defined by the line drawn after the previous peaks in recent days. This line and the line drawn after the lows could form a possible expanding wedge formation. In the shorter term, this potential support could be located at the trendline and at the equilibrium of corrective movements, which at the moment falls in the vicinity of 141.10 JPY. Source: Conotoxia MT5, USD/JPY, D1 What is being said about the yen? In a statement to Bloomberg, the head of the currency strategy at Nomura Securities Co. in Tokyo said that there had been a three-way discussion between the BOJ, the Ministry of Finance and the Financial Services Agency and that this has a significant psychological impact on the market participants. Yujiro Goto also added that it also has something to do with the fact that if there was any plan to intervene, the government would coordinate with the BOJ. Goto pointed out that the risk of intervention and a change in BOJ policy or guidance this month has increased compared to a few weeks ago. In the summary of the Nomura Securities Co. representative statement, it was noted that some orders that accompanied bets on the USD/JPY above 145 could also be triggered.   Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Fears of intervention targeting the Japanese yen (conotoxia.com)

On Wednesday, September 7, Apple's long-awaited event took place, at which new versions of the Cupertino company's products were presented. How did the company's US-listed shares react to the event? Apple Inc. unveiled the new iPhone 14, which has so-called safety features as standard. These include the ability to detect collisions and emergency SOS sending via satellite - a feature that allows users to send text messages in an emergency without access to cellular services. In addition, on Wednesday was the launch of the new AirPods Pro and Apple Watches. Apple's share price gained 1 percent on Wednesday, closing at $155.96. Better than the company itself, however, seemed to be the suppliers of components for the new products. Shares of Skyworks and Texas Instruments rose 1.7 percent, followed by Qualcomm, up 1.5 percent, and Qorvo, up 1.4 percent at the close of yesterday's session. Source: Conotoxia MT5, Apple CFD, D1 Apple stock price in recent times Apple's share price, after peaking in January 2022 in the area of $182, has retreated to the vicinity of $130 in early June. Currently, the share price seems to be in the middle of its annual fluctuation range, at $155. This gives the company a capitalization of $2.5 trillion, making it the largest in the world. In turn, the price-to-earnings ratio for Apple is 25, making it one of the largest in the last decade. In December 2020, this popular valuation ratio reached 35.40, while Apple's revenue for the quarter ended June 30, 2022 was $82.959 billion, up 1.87 percent from a year earlier. And Apple's revenue for the twelve months ended June 30, 2022 was $387.542 billion, up 11.63 percent from a year earlier. What is the outlook for Apple's stock price? According to the MarketScreener portal collecting recommendations from Wall Street analysts, the company has 26 buy recommendations, eight hold recommendations and zero sell recommendations. Institutions pointing to buy Apple shares include Credit Suisse with a target price of $201 and JP Morgan with a target price of $200. The average target price is $181.50, while the so-called Street High, or highest recommendation on Wall Street, is $220, and the Street Low is $130, according to Market Screener data. Source: Conotoxia MT5, MarketScreener - lowest, average and highest target price for Apple shares.   Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

German carmaker Volkswagen (VW) is planning to float a minority stake in premium car and sports vehicle manufacturer Porsche. The IPO could turn out to be one of the largest in Europe. Could the unfriendly market environment be an opportunity for Porsche? The timing for an IPO does not seem to be the best. Markets are in the midst of gigantic declines, which most likely resulted in a wave of pessimism among investors around the world. The volume of initial public offerings in the US alone has fallen significantly since 2021. After six months, we are down to just 10% of the volume of a year ago.  In such a period, companies are usually accompanied by lower valuations, measured, for example, by P/E (earnings per share) or EV/EBITDA (enterprise value divided by EBITDA) multiples. However, in the case of Porsche, this factor may have a reduced impact.  The company has the chance to distinguish itself from other IPOs with a great brand and interesting prospects for the production of luxury electric cars, gaining strong investor interest and thus a higher share price. However, it is hard to determine how strong a factor this might be. However, VW authorities seem confident of success. “We have shown a huge resilience, especially in crisis times,” VW and Porsche CEO Oliver Blume told reporters on Tuesday. “Looking back on the corona crisis, the semiconductor crisis, this year with the Ukraine conflict, we always have been able to show very high-profit margins, and we think this will be very convincing.” One of the biggest IPOs in Europe? According to Bloomberg data, the first phase of the IPO is expected to start as early as this month, unless the market situation deteriorates significantly, Volkswagen said in a statement. The process is expected to be finalized by the end of this year. The share offering would allow VW to raise additional capital, which may be needed to rapidly develop its electric vehicle line-up and create the necessary software.  The IPO is valued by Volkswagen at €85 billion. This would make Porsche the largest IPO in European history. The sports car manufacturer has reportedly already secured investments in the range of 60 and 85 billion euros. The IPO will be possible by a firm agreement between interest groups at VW: the Porsche and Piech families, the trade unions and the state of Lower Saxony (which owns 20% of VW's voting shares). On the Conotoxia MT5 platform, VW shares had gained almost 8.6% since the start of the trading session on Monday by 13:00 GMT+3 on Wednesday. According to MarketScreener, the company has nine buy recommendations, including ones from UBS and JPMorgan with target prices of €230 and €235 respectively. Source: VW plans Porsche IPO. Is this a good time? (conotoxia.com) The article was published on 07.09.2022 14:33

The major tokens have experienced significant declines after a consolidation phase lasting more than a week and a half. Now they are at levels last seen in June and the lowest since the crypto bull market of H2 2020. Are cryptocurrencies in trouble? The cryptocurrency market set a local low at the end of August. Afterwards, it entered a phase of growth that restored optimism in many investors. BTC, ETH and BNB have since gained 30%, 100% and 66% respectively. However, the deteriorating macroeconomic environment, despite the optimism about Ethereum's Merge, seems to be pushing the quotes lower and lower. BTC Bitcoin stands out as having the largest market capitalization and receives a lot of attention from analysts and investors. At 20:00 GMT+3 yesterday, BTC broke through the critical level of probable support of $19530 and dove lower. It is hard to say what the next level of support might be, but it is most likely a long way down from the current price. The daily drop was about 4% yesterday. BTC price, daily candles Today, the declines continue and on the Conotoxia MT5 platform at 11 GMT+3, BTC is losing about 1%. The price is below the 100, 50, 20, and 10-day moving averages. A reading of popular indicators: MACD and the directional indicator (ADX) may indicate a continuation of the trend (MACD marks the next lower bars of the histogram and ADX draws an increasing difference between the +DI+ and +DI directional lines). ETH Ethereum is the second cryptocurrency by market capitalization. It has gained a whopping 100% of its value in the recent surge most likely triggered by a wave of news about the upcoming Merge (the transition from proof-of-work (POW) to proof-of-stake (POS) blockchain). According to the Ethereum Foundation Blog, the technology transition will save approximately 99.5% of energy and significantly cut the cost of money transfers. On the Conotoxia MT5 platform at 11 GMT+3, ETH is losing around 3.8%. Technical analysis may indicate a slightly better situation for the token than BTC. ETH price, daily candles Today, ETH broke through the possible support level of $1530, but this has already happened to an even bigger degree a week and a half ago. The price also broke through most of the analysed moving averages today (100, 20 and 10-day), except for the 50-day moving average. Through the strong rally in recent weeks, the token despite falling as much as 23.7% from its local peak is only slightly below the average (50 points) of the RSI indicator, which may indicate a lack of signal. The MACD is most likely pointing to a continuation of the declines (the MACD histogram marked another bearish bar today, interrupting the several-day upward trend). The directional indicator (ADX) does not seem to give a clear signal yet, but with the continuation of ETH's declines, it could happen any day now. Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: BTC and ETH down - cryptocurrencies in trouble? (conotoxia.com)

Danone (BN) and Nestlé (NESN) are food concerns based in France and Switzerland, where they are also listed. Companies in this sector may enjoy popularity in times of recession, thanks to stable demand for their products and the high levels of cash flow (cash). Danone's main sources of revenue come from dairy and vegetable products (54%), special nutrition products (30%) and the sale of bottled water (over 16%). The company is relatively geographically diversified, with the United States being its largest market (20%). Nestlé has a more varied and diversified offering. 28% of revenue comes from beverage sales, 18% from pet food sales, 15% from dietary supplements, 14% from condiments and ready meals, and 12% from dairy products. As with its competitor, the largest market is the United States (more than 30%). Companies in the food products sector can be a good way to secure capital in times of recession. Due to the sale of the products necessary for life, these companies generally seem not to experience a significant drop in revenue and generate a lot of cash, which could provide them with a margin of safety, especially in such a volatile macroeconomic environment.  However, recent quarterly financial results have shown that Danone and Nestlé are facing rising costs despite revenue growth of 12.6 and 9.1 %, respectively.  Because of this, their net profit margins and thus profits have declined significantly. They recorded net profit declines of 31.0 and 11.7 %, respectively. Danone appears to be losing more through its large share of production in Europe, which is falling victim to sharply rising energy and raw material prices.  Over the course of 2022, BN and NESN shares lost 7.9 and 12.7%, respectively. However, it  could be assumed that the performance and behavior of these companies' shares against the market may improve if there is a global recession that halts rampant commodity prices, and the aforementioned companies manage to adjust to the new inflationary environment. In this case, margins could expand again.  JPMorgan's new recommendation for food conglomerates upholds the previous "buy" signal, which seems to be justified by similar analysts' assumptions. According to the MarketScreener portal, Danone and Nestlé have 25 and 27 recommendations, respectively. Sentiment towards the former is rather worse, with 8 "strong buy" recommendations, 2 "buy" and 11 "hold" recommendations. While the latter enjoys 11 "strong buy", 6 "buy" and 7 "hold" recommendations. The average target price for BN is 58.58 euros, which could indicate a possible 12.3% increase from the last closing price of 52.26 euros. NESN has an average target price of 124.96 francs, which could indicate a 10.2% increase from the last closing price of CHF 113.42.  It's worth mentioning that the failure to exit the Russian market, which accounts for several percent of their sales, could pose an image threat to Danone and Nestlé. The companies have made only token concessions to their operations in the Russian Federation. Nestlé, for example, has stopped local production and sales of only selected goods (KitKat and Nesquik), while the rest have been designated as "essential goods" and continue to be a source of revenue for the company. This, however, does not seem to pose a significant risk, as these companies have already been implicated in numerous scandals that have not had a long-term impact on their share price.    Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Nestlé and Danone with buy recommendations from JPMorgan analysts — an investment for uncertain times? (conotoxia.com)

Mercado Bitcoin is a Brazilian crypto exchange founded in 2013 which is one of the market leaders in Latin America. At its peak, it was valued at $2.1 billion and was hailed as the first "unicorn" (a startup worth more than $1 billion) crypto exchange in Brazil. Now it seems to be facing serious financial problems and is carrying out a second round of mass layoffs due to the market’s situation. The exchange is owned by 2TM, which owns a number of blockchain-related companies, such as Bitrust, CriptoLoja and Blockchain Academy. The companies create a specific ecosystem of information platforms, exchanges and educational tools. According to Bitcoin Portal also owned by 2TM, the company made 15% of employees jobless due to "economic problems." This may be especially due to the poor condition of the fintech sector. The statement also states that "the competitive environment continues to deteriorate" and "is unfair without the approval of a regulatory framework for digital assets."  The most recent layoffs in 2TM came in June, when 12% of the 750 employees (90) were made redundant, citing similar reasons - "a change in the outlook for the financial system." In addition, 2TM  mentioned in a statement that "the current scenario requires measures that go beyond reducing operating costs and makes it necessary to lay off some employees as well." Stock exchange problems could be caused by a significant drop in cryptocurrency prices, which causes them to experience a large drop in interest and thus turnover, especially in poorer countries where recession and high inflation may threaten the financial situation of retail investors. The group isn't the only entity carrying out mass layoffs. Other exchanges in Latin America are also shedding staff. Bisto laid off 80 employees at the end of May, while Buenbit laid off nearly 50% of its total workforce. The current situation is also forcing large companies such as Gemini Trust, Crypto.com and Robinhood to do the same. According to Coingecko data, Mercado Bitcoin allows trading on 152 cryptocurrencies, the most popular of which are Bitcoin, Ethereum and ShibaInu. The volume in the last 24 hours is close to $870,000.   Consolidation continues BTC and ETH have been moving in a sideways trend for the past 1.5 weeks, oscillating near the  possible support levels of $19500 and $1530. Such a long stabilization, with the high volatility of the other markets, may indicate a temporary balance between bulls and bears, where neither side is making big moves that could lead to larger price movements. It is a rather ambiguous sign that may indicate both reaching a neutral level for the price and talking about a potentially upcoming decisive move of these assets after the breakout from consolidation.   Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Mercado Bitcoin is carrying out another massive layoff. The consolidation of BTC and ETH has been going on for 1.5 weeks. (conotoxia.com)

The beginning of September may abound in many interesting macroeconomic events with the potential to influence financial markets. Among the most important may be the meetings of central banks in the Eurozone, Australia, and Canada, as well as several speeches by Fed representatives and the final GDP readings for several major world economies. The current week in the US may be relatively calm after last week's labor market data release, and the ISM Services PMI and trade data may be in the spotlight. Investors will also be able to keep a close eye on speeches by several Fed officials, including Federal Reserve Chairman Jerome Powell, at the 40th annual Monetary Conference, which will be held Thursday at the Cato Institute. Today, however, markets in the US are closed due to the Labor Day holiday. Of the central bank action events, market consensus expects that the Bank of Canada may raise interest rates by 0.75 percentage points, following July's 1 percentage point hike. Meanwhile, in Europe, the European Central Bank will decide on monetary policy on Thursday, and markets expect another increase in borrowing costs by at least 50 basis points, as the eurozone struggles with unprecedented levels of inflation. Preliminary data showed that in August price growth increased more than expected to a new record level of 9.1%, which increased the chances of a large interest rate hike by 75 basis points. Indeed, several ECB officials have recently come out in favor of a major rate hike and warned that interest rates must remain elevated for an extended period of time to curb price growth. Investors will also be able to keep a close eye on Russian gas supplies via Nord Stream. Gazprom said Friday that the key pipeline to Europe will not reopen as planned. This may have pushed the euro below the $0.99 level, making the common currency the cheapest against the dollar in 20 years this morning. Investors will also be able to keep an eye on Monday's OPEC+ meeting, which is expected to provide guidance on the cartel's production plan from October. Major producers are likely to keep oil production quotas unchanged, but Saudi Arabia has said the cartel could cut production if Iran reaches a nuclear deal with the West and restores exports. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: EUR/USD lowest in 20 years. ECB in the focus (conotoxia.com)

After 2:30 pm, the long-awaited US labor market report came out, showing mixed readings. The market in the first moment seems to have reacted to the publication with a weakening of the dollar and a rise in stock index contracts. Non-farm Payrolls hits 315K The U.S. Labor Department reported that non-farm sectors added 315,000 new jobs in August against a market consensus of 300,000 the smallest increase in new jobs in the U.S. economy since April 2021. The data for July, on the other hand, was revised slightly downward from 528,000 to 526,000. Last month's significant job gains were noted in professional and business services (68,000), which includes computer systems design and related services, healthcare (48,000) and retail trade (44,000). Manufacturing added 22,000 jobs, and leisure and hospitality added 31,000. Unemployment rate reaches 3.7% The BLS report shows that the U.S. unemployment rate rose to 3.7% in August 2022, the highest since February. The market consensus was for an unemployment rate of 3.5%. It seems that it was the rise in the unemployment rate to its highest level since March 2022 that the market may have reacted to. Investors in the interest rate market, according to Bloomberg, reduced bets on a quick interest rate hike by the Fed, which could have been reflected in the dollar, gold, stock indexes or cryptocurrencies. The U.S. labor market saw a slowdown in hourly earnings growth, to 0.3% for the month, from 0.5% in July, which may be the right direction for the Fed, but wages could still grow faster than policymakers would like. Wage growth is still a possible inflationary pressure, hence it seems that the next important publication may be the one on the change in price level, and it will be announced on September 13th. EUR/USD Following the release of the US data, the rate of the main EUR/USD pair seems to have risen above parity. Gold, on the other hand, is trying to turn back from under the $1,700 level to $1,705, and bitcoin is oscillating in the $203 region. ETH, on the other hand, is holding in the region of $1,600 before 15:00 GMT+3. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Mixed labor market data. EUR/USD above parity? (conotoxia.com)

The S&P 500 is arguably the most popular index in the stock market, with its value reflecting the share price of the 500 largest companies listed in the US. At the same time, the US enjoys the largest equity market capitalisation, standing at a whopping $53.4 trillion at the end of 2021 and accounting for more than half of all equity markets worldwide. Exchange-traded funds (ETFs) are a popular way to invest in the S&P 500. They reflect the behaviour of the underlying asset, in this case, the mentioned index. One of the most popular is the SPDR S&P 500 ETF Trust (SPY).  Doing so ended the so-called bear market rally that started in June. The first popular indicators that pointed to the end of the rally were the RSI and the MACD. The SPY price fell shortly after the RSI signal line entered the overvaluation zone and the first downward bar of the MACD histogram was drawn. Two days ago, the MACD histogram entered the negative zone. The SPY price is below the 10, 20, 50 and 100-day moving averages. What could be influencing the S&P 500's declines? According to Current Market Valuation, the P/E ratio (share price/earnings per share) of the S&P 500, recently hit its lowest level in more than 2 years. The P/E is considered a relatively good measure of valuation and is around 20 for the index, 25% higher than the historical average of 16. Its above-average level, together with worrying data from the economy, may indicate a possible continuation of their downtrend, but it is worth noting that the market seemed to ben generally 'overpriced' for several decades.  This may be due to the increasing share of technology companies in the capitalisation of the S&P 500, whose valuations are largely based on future growth. In addition, the huge capital stock in the US relative to GDP may be driving demand for equities, and thus we may have higher equity valuations.  According to the report “Stock Market Briefing: Selected P/E Ratios" by Yardeni Research (which aggregates average recommendations from Wall Street analysts), the target forecast P/E for the S&P 500 in 52 weeks (1 year) is around 16.7. Other companies report a similar forecast P/E. This may indicate the market's belief that declines  might continue in the coming months.  Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: The S&P 500 has the lowest P/E in more than two years (conotoxia.com)

The impending Merge (transition from POW to POS) of ethereum seems to be affecting ENS domain sales. Major crypto companies are not staying idle in the face of the chain transition and are becoming big stakeholders in the test "Beacon Chain". Ethereum Name Service (ENS), is a project that offers naming and recognition services for ETH wallets, in an operation similar to Internet domain naming, or DNS (domain name service). August became the third-best month in its annual history after ENS domains accounted for 2744 ETH or around $4.3 million in revenue.  According to ENS data for the past month, as many as 301,000 new .eth domain registrations were made and 34,000 new accounts were opened using at least one ENS name. The total of all .eth registrations now stands at 2.2 million names. The biggest convenience of the Ethereum Name Service is the ability to identify an ETH wallet by a short unique name in the .eth domain, instead of by an approximately 42-digit code. This simplifies token and NFTs transfers, as well as facilitates payments. In addition to these benefits, .eth domains, like .com, .net or .org internet domains, could be sold and may have their own unique NFTs.  The mentioned Merge involves ethereum moving from a proof-of-work blockchain to a proof-of-stake which, in a nutshell, means a different system of validating (confirming) transactions that are more energy efficient and cheaper, due to the use of economies of scale. ENS address registrations appear to be accelerating steadily. The record to date was set in July, when some 378,000 new names were registered. Although the role of domains in Merge itself is rather small, their increasing number may be a sign of the growing interest in ETH and the move to a cheaper and more efficient proof-of-stake (POS) infrastructure. The inevitable centralisation of DeFi? According to data from Dune Analytics and Nansen, crypto companies provide more than 66% of the staked ETH. This means that most companies such as Lido, Coinbase and Binance are likely to be responsible for a large proportion of transaction validation on the new ethereum system. Such entities, called validators, are supposed to be a kind of 'thread' of the new POS system. They will be responsible for storing data, processing transactions and adding more blocks to the chain. Each validator is expected to hold a min. 32 ETH - at the current price, this is approximately $51,000. Holding tokens makes such entities large depositories across the blockchain. This news has raised discussion on social media regarding the centralisation of the new blockchain, because with so much validation of POS transfers from institutions, can we really talk about DeFi? It seems that the ETH developers are aware of this drawback, but in order to make ETH efficient, reduce costs and further develop the ecosystem, they have decided to move towards a proof-of-stake blockchain. On the Conotoxia MT5 platform, ETH is gaining around 0.5% today at 11:30 GMT+3, already drawing its sixth daily bull candle. The consolidation seems to have put the token's price above the 10 and 100-day moving averages. Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: The Ethereum Name Service reports third-best month ever (conotoxia.com)

Whales Wallets The number of wallets holding between 100 and 10,000 BTC, or so-called whales, is on the rise, according to Santiment data. The analytics firm found that, despite the token's declines in recent days, the rate of accumulation of the largest cryptocurrency has increased. Given the correlation that exists between the price of BTC and the number of whale addresses, this could be a positive signal for bulls. The reported number of such wallets now stands at 15,847 – a level close to the numbers last seen in June.  On the Conotoxia MT5 platform, both BTC and ETH are losing around 1.3% today, at 12:00 GMT+3. Bitcoin is testing a likely support level of $19910. Ethereum's declines appear to be less regular. This may be related to higher volatility, possibly related to the upcoming Merge. ETH may be near a possible support level of $1530.  California is close to licensing crypto companies and posing restrictions on stablecoins California State Governor Gavin Newsom is expected to sign into law the recently passed 'Digital Financial Assets Law', which will require exchanges and other crypto firms operating within the state to be properly licensed. The California law appears to be similar to New York's BitLicense, introduced in 2015. That document required companies to obtain a licence from the State Department of Financial Services to serve customers residing in New York State. Holders of such a licence include Ripple Labs (XRP), Coinbase (COIN), Robinhood (HOOD) and PayPal (PYPL),  California's new law is expected to take effect in January 2025. In addition to the licensing requirement, the new regulation bans stablecoins that are not issued by banks or licensed by the California Department of Financial Protection and Innovation from 2028. Another clause in part of the bill requires stablecoin issuers that hold assets as reserves to have an amount "not less than the aggregate amount of all of its outstanding stablecoins issued or sold in the United States,". This is to be done under GAAP accounting standards.  The introduction of the 'Digital Financial Assets Law' may be linked to the wave of fraud that the crypto meltdown of the past year has revealed. 

Among economic data, PMI indexes can often be the fastest to show the current picture of the economy. Unlike GDP data, for which one has to wait a long time, preliminary PMIs are published the same month they refer to, with final readings appearing as early as the following month. The donwward of Europe's largest economy The data released today seem to indicate a deterioration in the economy, which could have an impact on stock indexes. For Europe, data from its largest economy, Germany, may be important. The S&P Global/BME Germany Manufacturing PMI for August was revised downward to 49.1 points from a preliminary reading of 49.8 points, indicating a second consecutive month of decline in factory activity. According to this report, there is a sustained decline in new orders, which seemed to affect production levels and slowed the pace of job creation in factories. On the positive side, companies may have been less pessimistic about the outlook than a month earlier, although concerns about high inflation, uncertainty in the energy market and the risk of an economic slowdown still seem to persist. PMI for the eurozone The index for the eurozone as a whole was also at a lower level. The S&P Global Eurozone Manufacturing PMI was revised down to 49.6 points in August from an initial estimate of 49.7 points. Manufacturing declined at a similar pace to July, when the deceleration was the strongest since May 2020. New orders once again fell sharply. Weak demand conditions were a major drag on manufacturers in August, reflecting deteriorating purchasing power across Europe with high inflation. In response to the deteriorating economic outlook, manufacturers further reduced their purchasing activity, the report said. The Lowest Poland Manufacturing PMI In Poland, the situation does not seem optimistic either. Poland Manufacturing PMI was the lowest since 2020. The S&P Global Poland Manufacturing PMI fell to 40.9 in August from 42.1 in July, below market forecasts of 41.8 points. The reading pointed to the fourth consecutive month of declining factory activity and was the worst since May 2020, as both production and new orders fell sharply. On the price front, costs and fees continued to rise at a slower pace, although high inflation continues to erode purchasing power, with sales from both domestic and international sources falling, a statement to the publication said. So it seems that economies still may not have reached their, which may also translate into a lack of bottoms in stock market indices. The following indicated their drop today, with Germany's DAX losing 1.7 percent from the start of the session until 10:55 GMT+3, France's CAC40 losing 1.68 percent and Italy's FTSE MIB losing 1.5 percent.

August seemed to be a month of high volatility, most likely due to the turbulent economic environment and a relatively good quarterly earnings season. We seem to be in for a very interesting bear market rally, with a possible peak in the middle of last month. At that time, the S&P 500 and Nasdaq Composite indices fell 3.2% and 3.9%, respectively. They set a peak (in mid-August), gaining 17.4% and 23.3% (the average historical magnitude of a bear market rally) from their local low (mid-June).    Disney (DIS) The entertainment market giant posted a 1-month gain of 5.9%. The stock had been declining for a year and a half, most likely influenced by extreme pessimism about the company's ability to continue to grow. As a result, the recession and lower consumer spending may have posed an additional threat to revenue from theme parks and streaming platforms. Since its peak in early 2021, Disney shares have fallen by 52.2%.  A short-term trend reversal occurred when Disney announced solid Q3 results (the financial year starts earlier than the calendar year for Disney). There was a 26% increase in revenue and a whopping 53% increase in net profits year-on-year. Net earnings per share were 10 per cent higher than expected. Among the main reasons for such a phenomenal jump in results is the expansion of owned streaming services, namely Disney+, Hulu and ESPN+.   Charles Schwab (SCHW) SCHW is a leading financial company engaged in brokerage, market making, investment banking, consulting and investment advisory services. Its share price rose by 5.5% last month. As for the stock price of other companies, Q2 results proved to be crucial the previous month.  The company reported an increase of as much as 31 per cent in interest income, which is the company's primary source of revenue (more than 50 per cent). Thus, SCHW's revenue and net profit increased by 11.7% and 41.7%, respectively. EPS (earnings per share) turned out to be 6.6% higher than Wall Street analysts' expectations. As a result, expectations of further possible interest rate rises and rising volatility (from which the brokerage business may benefit) appear to push the stock even higher.   Disney and Charles Schwab may be among the more interesting companies of August due to their phenomenal earnings despite the deteriorating macroeconomic environment.    Source: Leaders among the giants — stocks of the month?

Avalanche (AVAX) on 29 August, lost almost 12% on a day when a new whistleblower accused it of paying lawyers to attack its competitors' reputations. Since the bottom two days ago, the cryptocurrency's price now seems to have recovered some of its losses, rising by around 10 per cent, presumably after the accusations lost credibility in the eyes of investors. CryptoLeaks is a young news site that aspires to become WikiLeaks - known for shedding light on the crimes of governments. Two days ago, the site published an article accusing Ava Labs of paying lawyers from the Roche Freedman law firm to damage the reputation of its competitors.  The alleged evidence was a statement by one of the insiders. However, the claims made in the article appear to be exaggerated, and the evidence is too weak to support allegations of a deliberate and paid legal battle against competitors.  According to Santiment data, Avalanche became the most searched token (by keywords) shortly after the article's release.   How did the AVAX price react? Most likely, as a result of CryptoLeaks, the AVAX token fell by a whopping 12%, but shortly after scepticism about the article began to gain traction, the listing rebounded. At the end of the day, the cryptocurrency had lost just 3.1%, and the token recovered all of its losses the following day. Furthermore, the price declines of 29 August coincided with a correction in other currencies, making it reasonable to believe that the accusations' impact on sentiment was much smaller.  Today on the Conotoxia MT5 platform at 11:00 GMT+3, AVAX is trading at $19.35, losing 1.4%. The price is below the 10, 20, 50, and 100-day moving averages. The MACD indicator may point to a potential trend reversal after the histogram started to turn back from negative territory. Although not yet in the overbought zone (below 30 points), the RSI signal line seems to be relatively low (less than 35 points), which could indicate a possible trend reversal. On the other hand, looking at the chart from a broader perspective, it seems that it may still be in a downtrend. It seems that there are still storm clouds looming over the cryptocurrency market in the form of a hawkish Fed, an economic slowdown, an energy crisis and a big unknown in the form of inflation.   Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Avalanche recovers after accusations against the project are met with scepticism

The end of the month is often a time for summaries. In addition, the end of August is also the end of the vacations - how hot, not only in the weather but also in the economy and financial markets. So let's turn to a brief summary of events and possible prospects for the fall and winter. From the point of view of the financial markets, the main topic seems to be where interest rates in the United States will go in time for the end of the year and where they will be next year. At the moment, the market seems to be pricing the possibility of a rate hike on September 21 by 75 bps at almost 70 percent. Thus, the range for the Fed rate could rise to 3.00-3.25 percent. This, according to investors, may not be the end of the hike cycle. This one may end at 3.75-4.00 percent, a range that could be reached in early 2023. The rise in expectations for rate hikes in the US may have affected the US dollar and gold prices recently. The USD index appears to have completed its third consecutive month of gains in August. Since the beginning of the month alone, the EUR to USD seems to have lost more than 2 percent, and the British pound more than 4 percent, while looking at the change in rates since August 2022, the EUR and GBP could lose around 15 percent, being the weakest currencies among the world's major currencies, except for the Japanese yen, which seems to have recorded a loss of 20 percent in a year. The currencies that could lose the least to the USD on a monthly and yearly basis seem to be AUD and CAD. It looks like the strong dollar and relatively high expectations of interest rate hikes by the Fed may be leaving their mark on the gold market. The price of bullion appears to have fallen for the fifth month in a row. In August alone, gold may have declined by 2.75 percent, while in relation to the summer of last year, the price drop may be more than 4.5 percent. This still seems to be a small slide in relation to silver prices, which may be 23 percent lower on an annual basis. How the USD and the market's pricing in it may behave in the fall remains an open question. On the one hand, the hiking cycle by the Fed may already be fairly well priced by the market. In addition, rate hikes in the Eurozone, the UK or Australia may be more aggressive than in the US, which from an interest rate perspective could support the EUR, GBP and AUD. However, especially for the former two currencies, the other side remains - the energy crisis. In this situation, interest rates alone may not help if gas or electricity has to be rationed. Nevertheless, for the moment, when the market may be discounting the worst-case scenario for Europe, a new catalyst would be needed in the US, to support the USD this fall. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Dollar with the third month of gains. Gold with the fifth month of declines

The medical giant is after another phase of testing a new drug for type II diabetes and chronic kidney disease. The test results proved positive, and analysts have issued further favourable investment recommendations. Bayer is a German medical company that produces medical equipment, drugs and supplements. It operates globally and has about 100,000 employees, generating more than 44 billion euros in revenue last fiscal year.  In the last quarter, the company announced a whopping €12.8 billion in revenue (an 18.1% year-on-year increase) thanks to favourable currency movements and price increases. Despite a significant increase in net profit (up 87%), the company still posted a loss of €298 million. Despite a significant reduction in costs in the last quarter, the corporation is still struggling to optimize them. This applies especially to the high price of energy, materials and the war in Ukraine. Dealing with intense competition from companies such as Pfizer, Roche, and Novartis remains problematic.  Last year, the company spent as much as 5.4 billion euros on research and development. This enormous amount is used to develop more breakthrough devices and drugs. One of them is Kerendia (finerenone). It's a medicine to treat type II diabetes and chronic kidney disease. Today, the results of the third phase of clinical trials were released, showing that the use of the drug allows a significant decrease in the mortality rate of the mentioned diseases. Kerendia has thus been approved for distribution in the US, Europe and China and could become an essential source of revenue for the company in the coming years.  Bayer has also begun new clinical trials of a thrombosis drug (asundexian). The company said on Sunday that the next phase will test the effectiveness and safety of asundexian in patients with atrial fibrillation and those suffering from certain types of stroke. According to Bloomberg, this is the next step in the company's plan to refresh its drug portfolio, which is under threat from low-cost competitors.  JPMorgan and Barclays have issued a buy recommendation for the German giant, maintaining their previous target price of €75 and €90, respectively. According to MarketScreener data, the current average target price is 78.91 euros for all 24 recommendations. This implies a possible increase in the share price of more than 46%, while the lowest and highest target prices are 55 and 106 euros, respectively. At the close of trading on Friday, the company's share price was €53.70.    Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Bayer’s drug effective - a medical giant with new recommendations from investment banks

The crypto market could have collapsed after Jerome Powell's heavily hawkish speech in Jackson Hole. That day, the leading tokens, bitcoin and ethereum lost 4% and 9%, respectively, and continued their declines over the weekend, reaching levels not seen in two months. On the Conotoxia MT5 platform, bitcoin is losing 0.5% today at 10:30 GMT+3. After breaking through the likely support level of $20750 on Friday, the token may have entered a short consolidation phase. However, given the potentially high level of pessimism in the market, it may be expected that this will not last long, with possible further downward movements ahead.  The BTC price is far below the 10-, 20-, 50- and 100-day moving averages. The nearest possible support levels are around $19300 and $18600. The MACD indicator and the directional indicator seem to indicate the continuation of the downtrend. The RSI oscillator may foretell its reversal, slowly entering the overbought area. However, since oscillators can usually give signals well ahead, one should be very cautious about this signal.  On the Conotoxia MT5 platform, ethereum is losing 2% today at 10:30 GMT+3. The token tested the likely support level of $1530 on Friday, then broke through it on Saturday. Unlike BTC, ETH has had a much more intense series of rises, and the potential for continued declines maybe even more tremendous. That's probably why the cryptocurrency hasn't even entered a short consolidation phase like BTC, and instead is set lower and lower on successive daily candles.  ETH is also below the 10-, 20-, 50- and 100-day moving averages. Popular technical indicators (RSI, directional indicator and MACD) seem to point to a continuation of declines. Even the RSI, which may look optimistic for BTC, has yet to reach the overbought area for ETH.  On the Conotoxia MT5 platform, the Cardano project's native token (ADA) is losing strongly today, falling nearly 2.5% at 11:00 GMT+3. Cardano is an ecosystem that allows developers to create tokens and decentralized applications (dApps) within DeFi. ADA uses the Proof-of-Stake (POS) blockchain. For a long time, the project has been considered one of the 10 best projects in the crypto world, according to a Forbes ranking. Currently, the token is most likely following the market and seems to be recovering from the increases over the last two months. The current declines in the crypto market may continue after the Fed chairman's hawkish speech. The expected pivot in monetary policy is likely to happen, but much later than investors anticipated. In the short to medium term, the speculative nature of cryptocurrencies and optimism about blockchain technology could be stifled by the recession, high-interest rates and lower disposable income.    Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Crypto on fire - ETH and BTC are approaching price levels last seen in June

The speech by Fed Chairman Jerome Powell, expected by investors, may have shaken the markets. During his address, markets could have seen more volatility, leading to a sell-off in risky assets and another wave of dollar appreciation. On Friday afternoon, when the Fed Chairman spoke in Jackson Hole, the U.S. dollar seemed to strengthen, and again to levels last seen 20 years ago. The U.S. Dollar Index is also attempting today to continue its rise from Friday, surpassing the 109-point level, which could result in the establishment of a new peak in the recent uptrend. Jerome Powell, in his speech, indicated that the Fed is committed to lowering inflation by raising interest rates and keeping them higher for a longer period of time. This, in turn, may have influenced the market's valuation of the Fed's actions on September 21, where investors seem to assume a rate hike of 75 basis points to 3.00-3.25 percent with a 70 percent probability. Before Jackson Hole, this probability was around 50 percent. In Powell's view, the right thing for the Fed to do is to continue the monetary tightening cycle until inflation is within the 2 percent target. The Fed seems to be looking more broadly at the data than a horizon of one or two months, and a possible peak in inflation may not change anything here for the moment. The Federal Reserve chairman also warned against loosening monetary policy prematurely. This may have dashed the market's hopes for a so-called Fed pivot, a 180-degree change in attitude. According to Jerome Powell, fighting inflation may be "painful" for the economy to some extent, but it is better than letting inflation get even more out of control. Such statements may have been followed by a retreat from risky assets in the financial markets. On Friday, major U.S. stock indexes took a dive and erased all potential gains from August. The Dow and S&P 500 lost 3.03 percent and 3.37 percent, respectively, while the Nasdaq Composite lost 3.94 percent, its biggest drop since mid-June. This morning, futures also seemed to show potential losses, dropping between 0.7 percent and 1.3 percent. The cryptocurrency market was also not indifferent to the Fed chairman's words. Bitcoin, which cost $25,000 as recently as mid-August, slipped below the $20,000 level at the end of the month and appears to be approaching its June low. Ethereum, which recently cost $2,000, is now priced below $1,500. Thus, one can see that the market has begun to depend on events in the real economy and on the actions of the Fed, much like the traditional financial markets, to which, after all, it was supposed to be an alternative. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Dollar hits 20 years high. Stock market tumbled

Britain's energy industry regulator has raised the cap on annual electricity bills to keep up with the constantly rising cost of procuring electricity. The yearly bill will be capped at £3549 from October 1. That's a whopping 178% increase since last winter and an 80% increase from the current level.  An increase in the UK's price cap may occur in future quarters if demand is not met with a sufficiently large supply of fuels, especially gas.    According to estimates by consulting firm Auxilione, the price cap on electricity in the UK could rise to a staggering £7272 by April 2023. At the same time, Cornwall Insight estimates that a year from now, in August, the level could reach £6616.    Natural gas is a popular source of energy in Western Europe. Despite its small share in energy mixes, it is an essential source of heat in winter for most EU countries and helps quickly supply the electric grid when power generation from other sources drops. These two reasons are most likely behind such significant increases in electricity prices following the cut in Russian gas supply.  More quarters of record profits for energy companies?   BP and Shell are the most prominent Western European petrochemical companies in the natural gas market in terms of revenue. They rank No. 2 and No. 3 globally, respectively, and are among the most important suppliers of blue fuel to Europe, especially after the reduction of its supply from the East.   In the last quarter, BP and Shell announced record results, reporting $67.9 billion (85.9% year-on-year growth) and $100.1 billion (65.3% year-on-year growth) in revenue, respectively. However, it wasn't the strong sales growth that came as the biggest surprise to investors but the net profits, which amounted to $9.3 billion and $11.5 billion, respectively, due to significantly expanded margins.   The current market situation may indicate that the excellent performance will continue in the coming months due to the record price of natural gas and the stabilization of oil prices after the recent decline. Even if the consulting firms' estimates were halfway correct, this could mean a record price for fuel supplies for power generation and household heating.   BP and Shell, which serve much of the European market, may continue to face high demand. Despite the expected drop in production in the EU market and thus industrial demand, European countries still need to stockpile plenty of gas to fill their reserves for the upcoming winter.   European energy index prices have had their strongest week of increases in 2 months. In Germany alone, electricity prices have risen by 860% over the year. Even in France (which bases 74% of its power generation on nuclear power plants), energy prices have reached an annual increase of more than 950% after it was announced that some nuclear reactors would be temporarily halted for maintenance work. Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service)   Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.   CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Europe's energy crisis is getting worse every day - more record profits for the energy sector?

Samsung Securities, a company engaged in asset management, stock issuance and other financial services, has announced that it will set up its crypto exchange in 2023. The company is expected to start in Korea and later plans to expand to other markets.   The division mentioned above of the company is part of Samsung's large-scale structure, which is part of the so-called chaebols (giant Korean conglomerates). It operates in a wide range of sectors of the global economy - from producing weapons and smartphones to selling clothing or even providing financial services.   The "Securities" division already has experience in implementing crypto-related investment technologies and products. It established the first blockchain ETF (exchange-traded fund) in Asia in June, listed on the Hong Kong Stock Exchange. It gives investors exposure to companies developing and investing in crypto technology.   The company is in talks with regulators and authorities to obtain the necessary approvals and licenses to establish the foundation of the exchange. Mirae Asset Securities and five other domestic companies are also planning to launch their investment platforms, but they do not have as much experience as the rival Samsung.   Earlier this month, the Securities division was one of three financial institutions in South Korea to partner with the country's largest exchange, Bithumb. The partnership meant Samsung Securities customers could indirectly invest in cryptocurrencies through the company's app.   Despite its inflexibility, chaebol has an established market position with enormous outreach and influence. For this reason, acquiring more clients on attractive terms may be easy for the firm, and it could be a significant competitor to Coinbase, Binance FTX or KuCoin.    South Korea seems to be aspiring to become a technology leader in the market. In early August, a "Korea Blockchain Week" event was held in Seoul, bringing together industry leaders, crypto regulation projects revealed are relatively lenient compared to those proposed by authorities in the US, and local companies are interested in further investments in blockchain technology in the DeFi and system infrastructure segments, among others. These plans could make South Korea a hub for the development of crypto technology and companies.  Market losses after recent days of sideways movement   On the Conotoxia MT5 platform, bitcoin and ethereum are losing 1% and 3%, respectively, today at 11 GMT+3. The leading tokens have been outside the previously drawn price channel for a week. The local possible support levels for BTC and ETH are $20700 and $1530, respectively. Their crossing could mean further declines. The continuation of the correction may be indicated by technical indicators such as the MACD, whose histogram for ETH has been falling steadily for a week and a half and now is near zero. In contrast, BTC reached the negative area a few days ago and seems to be falling lower and lower each consecutive day.    The EOS token seems to be losing the most heavily on the trading platform, recording a daily decline of 6.5% at 11:00 GMT+3. EOS is the native token of the EOSIO network, where the project provides blockchain developers with a set of essential tools and services for building and scaling decentralized applications (dApps). Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service)   Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.   CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Samsung plans to open a cryptocurrency exchange - will it succeed in dominating another sector? Market losses after several days of stabilization.

Leading investment and commercial banks are vital to the international financial system. They are responsible for money transfers, investments, currency exchange, hedging corporate exposures, etc. Banks may be exposed to potential risks in an environment of changing interest rates, or it may be a potential opportunity for them to improve their profits. Given the volume of lending activities, commercial banks' performance seems most sensitive to a change in interest rates. Investment banks, meanwhile, through their handling of investment projects and trading activities, have the potential to profit when interest rates change significantly. How did the banks perform? JPMorgan Chase (JPM), Bank of America (BAC) and Goldman Sachs (GS) are among the largest and most influential banks in the world. In the second quarter, they generated revenues of $31.6 bln, $22.8 bln and $11.9 bln, respectively. Out of them, only JPM failed to beat Wall Street analysts' expectations in terms of revenue. JPM and BAC expect some borrowers to default through the difficult economic situation in the US. As a result, the former has set aside reserves of  $428 million to cover non-performing loans. Figures from leading banks seem to indicate that, after a record 2021, the number of mergers and acquisitions (M&A) and IPOs is declining significantly. BAC reported a decline in investment banking deal volumes in Q2 after last year's historic highs of a whopping 47%. However, the impact on books was offset by a 22% growth in net interest income, most likely driven by rapidly rising interest rates.  Moreover, rising interest rates due to the popularity of fixed-rate lending in the US do not seem to translate as strongly as one would expect into corporate profits. Irresponsible credit policies seem to be hitting the sector's performance hard, as can be seen in the share prices of JPM and BAC. They have already fallen 28.4 and 25.3% respectively this year. However, the announcement of the suspension of buybacks is also not a good sign and may indicate that management might consider the current share price too high. Goldman Sachs, which shares have lost 13.5% this year and surprised positively relative to expectations on Wall Street, appears to be a peculiar exception. Historically, GS has been relatively immune to periods of crisis, in which the company has taken advantage of high volatility to boost earnings. Nonetheless, the current situation is probably unsuitable due to its high vulnerability to declining transaction revenues (M&A) and share issues.  In contrast to the mixed and less-than-ideal performance of JPMorgan Chase and Bank of America, Goldman surprised the market with a significant increase in high-margin sales of securities to companies (especially those looking to hedge in a challenging macro environment). Income from these rose by a staggering 55% to $3.61 bln against the $2.89 bln estimated by Wall Street. Income from the sale of shares also rose more than estimated to 2.86 bln against a forecast of $2.67 bln. Finally, JPM, BAC and GS profits were 8.6 bln (-28% year-on-year), 6.25 bln (-32% year-on-year) and $2.79 bln (-48% year-on-year) respectively. This significant decline may shatter the stereotype that a high-interest rate environment can only be beneficial for banks.   Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Banks' earnings summary - do rising interest rates benefit financial institutions?

After many years of announcements, the Ethereum Foundation yesterday set an official date for the complete transition to the Proof-of-Stake (POS) blockchain. As previously anticipated, there have been no delays, so the 'migration' is expected to begin as early as 6 September. The upgrade, known as 'Bellatrix', involves replacing ETH miners with validators, a kind of 'nodes' of the Proof-of-Stake system. They will be responsible for storing data, processing transactions and adding more chain blocks. Each validator is expected to hold a min. 32 ETH - at the current price, this is approximately $60000.  The Ethereum Foundation expects to activate the Beacon Chain as early as 6 September. This is expected to be the first test connection to begin the complete transition to POS. The activation is scheduled for 11:34:47 UTC. After the initial activation, the Terminal Total Difficulty (TTD) triggering the Merge is expected to reach a value of 5875000000000000000000000000000. This is nothing more than the level of synchronisation of the blockchain, which will become a Proof-of-Stake (POS) chain once the threshold value is exceeded. The timetable is for this to be achieved between 10 September and 20 September. According to CoinDesk, Ethereum developers estimate that this moment will occur on 15-16 September. Merge could have an impact on the crypto world and its prospects. Its scale seems to surpass the ETH split of 2016 and could point to new areas of growth such as a Proof-of-Stake solution, energy efficiency and much lower commissions.  In addition to its impact on the development of technology and ETH, the transformation may also affect other tokens that are heavily influenced by the changing ETH blockchain. We are talking primarily about LDO, ETC and OP tokens. These are projects to which an upgrade could give new meaning.  Additionally, yesterday Vitalik Butterin, founder of Ethereum, published a post on Twitter in which he stated, "People continue to underrate how often cryptocurrency payments are superior not even because of censorship resistance but just because they're so much more convenient,". By this, he seems to be referring to the fundamentals of crypto and the changes to come.   Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Merge receives official start date - what do you need to know?

The EUR/USD major currency pair's exchange rate is trying to return above the 1.0000 parity level for the second time in recent times. The first time the rise may have been a consequence of weaker US data, and now the market may have seen improved sentiment following China's actions. As reported by Bloomberg, risk sentiment may have improved in global financial markets after China announced that it will pump another 1 trillion yuan ($146 billion) into the economy to support GDP growth. China can thus counter both the negative effects of its zero COVID policy and counter the global economic slowdown. China, in effect, can save domestic demand. Nevertheless, today and tomorrow it seems that much more important news than that from China may hit the market. Today at 1:30 p.m., the minutes of the last meeting of the European Central Bank will be published, from which investors will be able to try to decipher what course the ECB will take this fall. According to the interest rate market, the central bank's borrowing cost could rise by 1 percentage point by October, which could mean two increases of 50 basis points each. It seems that the ECB's priority may be to fight inflation, even if this would be at the expense of economic growth - something that may be evident in today's minutes. This approach may also be borne out by recent statements by the ECB's Isabel Schnabel, pointing to the high risk of inflation and the lack of a decline since the central bank's last decision. In theory, the bigger and faster interest rate hikes in Europe, the more favorable it could be for the EUR (if there was no energy crisis). On the other hand, tomorrow at 16:00 Jerome Powell will open the symposium in Jackson Hole. The market seems to be discounting a more hawkish stance from the Federal Reserve chairman at this point. The rationale for this is probably the growing realization that central banks are ready to act to bring down core inflation as quickly as possible, even at the expense of macroeconomic weakness. According to the interest rate market, the scales for the next increase in the cost of borrowing may tip toward 75 basis points (60 percent probability for such a move on September 21). All of this could affect the EUR/USD main currency pair both today and tomorrow, and the struggle to break away from parity levels may only be beginning. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: ECB minutes and Jackson Hole key for EUR/USD

Very high commodity prices caused by the war in Ukraine may have presented a major opportunity for the energy sector. Oil & gas companies were trying to meet the rapidly growing demand caused by the interruptions and halting of Russian gas and oil deliveries to Europe. How did energy companies perform? Shell Plc (SHELL) and BP Plc (BP) are Europe's largest petrochemical companies, extracting, processing and selling oil and natural gas. They control almost all stages of the extraction, processing and distribution process, which can be an advantage with high volatility in the fuel market. This way, companies are relatively well protected against the need for switching suppliers, partners' commissions and margin reduction. "With volatile energy markets and the continued need for action to combat climate change, 2022 continues to pose a huge challenge for consumers, governments and companies alike," - said CEO Ben van Beurden in a statement. However, despite "volatile energy markets," energy companies were able to make extraordinary gains. Shell reported a whopping $100.1 billion in Q2 revenue, up from $84.2 billion in Q1. To show magnitude, H1 2022 revenue is more than the revenue for the whole of 2021. BP, on the other hand, reported $67.9 billion in revenue against a forecast of $60.9 billion. The company's strong performance in oil refining and sales contributed to this spectacular beat in expectations, according to the company. Shell and BP's revenues rose 65.3% and 85.9% year-on-year, respectively. Other companies in the sector such as Chevron, Exxon and TotalEnergies also posted giant increases in revenues and profits. Earnings per share (EPS) were as high as $3.08 for Shell, almost 10% higher than the expected $2.80 EPS. BP surprised the market with $2.61 in earnings per share (EPS), significantly beating forecasts of $0.34 per share (a 658.5% surprise). Shell and BP increased their net profits by as much as 109.1 and 215.8% year on year. The extraordinary profits will be used for buybacks. Shell and BP announced that they spent $8.5 billion and $3.5 billion, respectively, on share buybacks in the first half of the year. Shell plans to spend another $6 billion and BP $3.5 billion for this purpose. BP additionally decided to raise its dividend by 10%. According to the Bloomberg news service, the buybacks are evidence that the war in Ukraine has brought significant profits to the sector. However, high fuel prices can pose the threat of a cost crisis and strangle the economy, as recent readings of energy prices and GDP changes in major economies have proven. The price of energy in Germany is now at record levels of more than 700 euros per MG of energy for next year, and according to the U.S. Bureau of Statistics, U.S. GDP in the second quarter once again recorded negative growth, this time at -0.9%. This could affect the future performance of the fuel giants.   Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Energy companies' earnings summary - record profits for the sector

The NFT, even after huge declines in trading volume in recent months, seems to have attracted the interest of investors - speculators in this market can still look for potential investment opportunities, and NFT projects are outdoing themselves with more and better unveilings of their venture. Strong interest in NFT has naturally attracted the world's best-known apparel and accessories brands. According to data from Dune Analytics, Nike, Gucci, Dolce & Gabbana and Tiffany earned a total of $260 million from the sale of their NFTs.  Nike received the most revenue from NFT sales. Collections were sold for as much as $185.3 mln, with a secondary market turnover of $1.3 bln and more than 67,000 concluded transactions. In second place is Dolce & Gabbana, which earned $25.7 mln. They are followed by Tiffany ($12.6 mln), Gucci ($11.6 mln) and Adidas ($10.9 mln). After the rise of the first big collections, such as Bored Ape Yacht Club and Crypto Punks, which generated billions of dollars in sales, it was the turn for global fashion brands. They began experimenting with technology to reach more customers and generate new revenue streams. There are minimal costs involved in selling NFTs, especially for companies with a such large following as Nike and Adidas, for example. Therefore, margins from token sales can be very high, and revenues mostly turn into pure profit.  Despite waning interest in NFTs, they can still have a significant impact on new trends in corporate branding. Nike and Adidas have already indicated that they intend to develop NFTs in the Metaverse, which could affect the perception of these brands as innovative and unique, also in the virtual world.  It's worth remembering, however, that an alarmingly large number of projects can't sustain a sufficient level of interest. After its peak at the first offering, excitement tends to drop in the secondary market, and with its prices. NFTs seem to have more resilience to decline if they are the equivalent of something real and have additional functionality. One of the few success stories on the market is the collection of entrepreneur and influencer Gary Vee. VeeFrieds, despite the questionable quality of the graphics, produced a great return on investment. The print price of one NFT ranged from 0.5 to 2.5 ETH, and at the current value of the collection, early investors were able to make between 300 and 1,000% gains. In addition, the token gives the holder the right to participate in one of the leading NFT events - Beacon, organized by Gary Vee. The businessman also enjoys a very loyal following, who believe in the words and vision of the idol, so they are rather reluctant to sell their ownership rights, represented by the token.  RafaÅ‚ Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Nike, Gucci and other big brands make millions from NFT sales despite falling interest

WTI crude oil futures rose above the $93 per barrel level today. The price increase may be supported by both macroeconomic data and statements from Saudi Arabia and OPEC. The Organization of Petroleum Exporting Countries may decide to cut oil production in the event of a global recession, representatives of several countries in the alliance told The Wall Street Journal on Tuesday. OPEC and its partners, led by Russia, have been closely coordinating oil production volumes, especially since the initial impact of the coronavirus pandemic in the first half of 2020. The alliance's members will meet again on September 5 to set an oil production rate, according to the BBN news service. Meanwhile, crude inventories in the United States fell by 5.6 million barrels last week, according to data released by the American Petroleum Institute (API). The market consensus was for a much lower decline of 0.9 million barrels. The EIA's official government data will be released today. It is expected to reduce reserves by 933,000 barrels. Probably by a combination of the above two factors, oil prices rose almost 4 percent on Tuesday. Counting from the June peak, however, oil has lost about 25 percent, probably due to growing concerns that a global economic slowdown could dampen consumption. Does the Fed need to be aggressive? The U.S. dollar index rebounded on Wednesday to near 108.7 and rose again toward its highest level in 20 years. USD appreciation may have been influenced by comments from US Federal Reserve officials. Minneapolis Fed Chairman Neel Kashkari said that his biggest concern is that the extent of price pressures has been underestimated and that the central bank will have to be more aggressive for a longer period if inflation persists. This could mean tightening monetary policy even as the specter of a stronger brake on the economy looms. Kashkari added that the central bank may ease interest rate hikes when it becomes clear that inflation is heading toward 2 percent. Further clues about the Federal Reserve's action plans may emerge later this week, when Jerome Powell, chairman of the Fed, addresses the annual symposium in Jackson Hole. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Oil rises in price, dollar rises in strength

During the recent earnings season investors' were especially focused on consumer staples companies. Their sales figures are potentially a good indicator of the consumer situation - they can show how the average shopper is seeking savings and how much they are buying. How did the consumer staples companies perform? Thanks to the strong return of demand after lockdowns and the uncertainty of supply chains, stores have accumulated a lot of inventory, which, with the current drop in demand, could pose a significant problem. Most stores have been forced to cut prices or write off products.  Walmart (WMT), Costco (COST) and Target (TGT) are among the largest U.S. retailers. Unlike Whole Foods and Trader Joe's, they tend to have lower prices, especially Walmart. Walmart initially spooked markets by lowering its profit forecasts and warned of a rapid rate of decline in demand. However, announced second-quarter results show that WMT and COST sales rose 8.4% and 16.2%, respectively. For Walmart, they totalled $152.9 billion and Costco reported $52.6 billion in revenue. In addition, Walmart's online sales jumped as much as 12%. Despite the improved sales, the companies are struggling with the problem of giant inventories. Walmart alone had $61 billion worth of inventory at the end of Q1. Prominent among the inventory is apparel. Most likely, the introduction of a series of discounts has boosted sales levels by stimulating demand. The news reported inventory value for Walmart remains high, at $59.9 billion.  Walmart and Costco's second-quarter net income rose to $5.15 billion ($1.77 EPS) and $1.35 billion ($3.04 EPS), respectively, marginally exceeding Wall Street analysts forecasts.  The black sheep was Target (TGT), whose profits fell a staggering 51.9%, despite revenue growth. Net profit margin slipped 53.8% to 4.01%, driven by the write-down of gigantic amounts of inventory. "If we hadn’t dealt with our excess inventory head on, we could have avoided some short-term pain on the profit line, but that would have hampered our longer-term potential," - said the Target chain's CFO. Executives noted that sales of lower-priced and low-margin products are on the rise, which may indicate a consumer search for savings. This was naturally reflected in a decline in net profit margins. In general, the performance of companies in the consumer staples sector proved to be good. Consumers, taking advantage of discounts and avoiding the more expensive stores (ex. Whole Foods and Trader Joe's), are contributing to the revenue growth of the cheaper ones, which include Walmart. Profits despite the losses from excess inventory in the case of Walmart and Costco appear to be strong. Target, adopted a more drastic strategy and preferred to write off much more merchandise and suffered gigantic losses.    Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Summary of consumer staples' earnings - What is the consumer's situation?

According to Coinmarketcap data, the total capitalization of cryptocurrencies has fallen to nearly $1 trillion, showing a major shift in sentiment among traders and investors in recent days. The last time market capitalization was at this level was in late July. The possible trend reversal does not only apply to cryptocurrencies. The Nasdaq and S&P 500 have fallen from their local highs of August 16 by 5.7% and 3.8%, respectively. This is a significant change for such large indexes. Interest rates on U.S. 5-year Treasury bonds, after recording a local low of 2.55% on August 1, have risen to 3.17% in recent weeks, as Fed policymakers' statements proved more hawkish than expected. These are potential signs of a deteriorating outlook again, which should not be ignored. A chart of the Crypto Fear & Greed Index may show a decline in crypto market sentiment and an increase in investor fear. As recently as last week, the index showed a reading of 44, and now it is 28 points. Despite the partial decrease in the correlation between bitcoin and the S&P 500, it still seems to be high. Especially since it has historically risen during crashes - the last peak in the correlation was reached in mid-May, when both markets were down. BTC and ETH, despite finding support at $20,700 and $25,300, respectively, could be more exposed to the downside due to deteriorating economic data and market sentiment.  On the Conotoxia MT5 platform as of 12:00 GMT+3, one of the strongest falling tokens is EOS, which is losing nearly 9% after a 7-day gain of 48%. EOS is the native token of the EOSIO network. In practice, the project provides blockchain developers with a set of necessary tools and services to build and scale decentralized applications. The project's first whitepaper was released in 2017, and the team conducted an ICO, securing more than $4 billion in investment. It was one of the largest crowdfunding events in the history of cryptocurrencies.   Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Does data signal more short-term declines in the crypto market?

Selling pressure on the euro may lead the exchange rate of the main currency pair EUR/USD below the parity level. As a result, in the fourth week of August 2022, we may see levels from the end of 2002. The most significant risk factor for the euro appears to be fear of recession. These may increase with rising electricity and natural gas prices. The consequent deepening of the energy crisis and the dim prospects for its resolution may negatively affect the European currency in the eyes of global investors. The aforementioned natural gas prices seem to be approaching the record level of EUR 300 per megawatt hour. This could be a consequence of Russian energy giant Gazprom's announcement to shut down gas flow through Nord Stream 1 to Germany due to maintenance work at the end of August. Earlier, due to turbine problems, the gas flow was reduced to 20 percent. Electricity prices for next year's contracts are also breaking records. They have risen from €50 to €700 in just a few months. The eurozone's economic woes seem to be confirmed by macroeconomic data. The August Global S&P PMI showed that business activity in the eurozone declined for the second month in a row, albeit less than expected. The S&P Global Eurozone Composite PMI fell to 49.2 in August from 49.9 in July, above market expectations of 49, the preliminary reading showed. The latest data showed a second consecutive decline in business activity across the eurozone after a 16-month period of growth. The overall decline in output was again driven by a contraction in the manufacturing sector, where output fell for the third consecutive month, according to the published data. Germany posted its sharpest drop in output since June 2020, while activity in France fell for the first time in a year and a half. Investors are now awaiting the hawkish tone of Thursday's minutes from the European Central Bank's monetary policy meeting, as inflation in the eurozone still appears to be hitting record highs. Recall that the ECB surprised in July by raising interest rates by 50 basis points. The market can now expect two more increases of 50 basis points each at the September and October meetings. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.     Source: Euro below parity again. Black clouds over the European economy

We've had arguably one of the busiest quarterly earnings seasons in history, which showed how companies are behaving in a rapidly changing inflationary environment. The overall findings seem to have been positive, and likely contributed to a bear market rally in the broad stock market, accompanied by dovish Fed signals and a lower US CPI inflation reading. How did technology companies perform? Companies in this category typically base their high valuations on the prospect of growth and increasing profits. That's why analysts were especially curious to see how well-known brands would behave in a difficult environment and what resilience they would show.  Alphabet (GOOG) and Meta (META) are advertising giants, but the characteristics of their businesses are quite different. The former (Google's parent company) makes its money largely from SEO and the latter from social media campaigns such as Facebook and Instagram. The companies' results showed that SEO seems to be more of a priority for customers, and therefore revenue along with GOOG's profits appeared to be more stable. Google's revenue rose 12.6% year-on-year, while Meta's fell by less than 1%, while profits fell 13.6% and 35.7%, respectively. Despite passing some Wall Street analysts' estimates, Microsoft proved more recession-proof than expected. Bill Gates' company reported $51.9 billion in Q2 revenue (up 12.4% year-on-year) and net income of $16.7 billion (up 1.7% year-on-year).  "We continue to expect double-digit revenue and operating profit growth in constant currency and U.S. dollars," - said Microsoft CFO Amy Hood, at the earnings conference. She added that Microsoft will extend the life of its server and network hardware to six years from four years. The company made a similar move in 2020, intending to cut costs.   The biggest problems for technology companies also producing hardware, such as Microsoft (manufacturing Xbox) in addition to high exchange rates volatility, may remain rising production costs and a hard-to-quantify drop in demand due to the recession. One company that may have disappointed many with its results and caused a big drop in its stock price was Snapchat. The platform's shares lost 39% in a single session after the results were released.  Snapchat reported a drop in revenue to $1.11 billion, compared to the expected $1.14 billion. However, earnings per share, to which investors seem to pay the most attention, instead of falling by 1 cent, slipped twice as much, by 2 cents per share. This happened despite an increase in the number of active daily users - 3.2 million more than estimated. Snapchat, despite becoming increasingly unpopular in Central and Eastern Europe is still frequently used in Western Europe and the United States, but it has long struggled with relatively sizable revenue fluctuations and problems maintaining growth rates through app monetization issues. Additionally, with increasing competition from other platforms like TikTok, the company's future may not look too rosy. Most of the leading technology companies, despite an apparent slowdown in growth, maybe in relatively good shape. Their revenues are usually stable, and the biggest challenge is cost containment - hence the companies' announcements about layoffs and cost optimization, and focusing on their most profitable areas of business. According to CNBC, about 50% of technology companies are already planning to carry out layoffs, which appears to be related to the macroeconomic situation.   Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Technology companies earnings recap - what do they signal?

The average bitcoin payment fee recently fell below $1 for the first time in years. Transaction fees are needed to enable crypto intermediaries to operate, but they are hampering the adoption of payment solutions, affecting small payments in particular. Because the network is expensive to maintain due to its energy-intensive nature, commissions have been able to shoot up many times, for example, Ethereum commissions during the NFT hype. This is even more painful for transfers of small sums. This is why new technological solutions are so important. Here comes ethereum's Merge and payment solutions for bitcoin (Lightning Network and Taproot overlays), which are already revolutionising the world of crypto payments. They allow settlements to be faster, less energy-intensive and less expensive. The current average transaction fee for BTC payments has fallen below $0.825 - the lowest since 13 June 2020, ETH below $0.64, and is likely to be even cheaper. Their decline is not only a reason for the ever-improving technology, but also the recent crash of tokens, NFTs and an increase in the ease of mining in the long term. However, current energy and cryptocurrency prices may cause a short-term decline in mining activity. Many have already suspended operations or exited the crypto world. This can be seen in particular through the massive sale of mining rigs and used computer hardware (especially graphics cards). ETH, BTC and most tokens seemed to continue their declines. ETH and BTC prices are below the price channel and in the absence of a return above its bottom line, we can probably already speak of a short-term trend reversal. ETH has found its support on the 50-day moving average for now, while BTC has already crossed it. Moreover, the technical indicators (RSI, MACD and ADX) do not indicate a reversal of the short-term trend either. Declines in the major stock market indexes, hawkish announcements from the FED and further pessimistic data from the economy seem to be putting a lot of pressure on crypto. RafaÅ‚ Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: BTC and ETH payments getting cheaper. Will Cryptocurrencies experience further declines?

The recent behavior of the euro and the British pound and their potential weakness against the rest of the world's major currencies is beginning to bring concerns about a sustained deterioration in the prospects for these currencies. As Bloomberg commentators note, the behavior of the pound and the euro are worrisome. We have recently seen large shifts in the euro and pound's short-term market interest rates against the U.S. dollar, with a simultaneous weakening of the GBP/USD and EUR/USD exchange rates. Last week was the worst week for the pound in nearly two years, and at the same time, the yield on the UK's 2-year bond rose by 50 basis points. Typically, the opposite happens in developed markets. Expectations of a central bank rate hike and thus an increase in short-term market yields generally strengthen the currency. The collapse in the correlation between the exchange rate and interest rates is usually associated with emerging markets, which may have lost the battle for the credibility of keeping inflation within the inflation target. The energy dependence of the UK and Europe as a whole means that their balance sheets could deteriorate in the near future, while energy commodity inflation shows no signs of abating. Rate hikes in such a situation may not stem the tide of depreciation of the aforementioned currencies, Bloomberg reports. Thus, it seems that the winter months for the EUR and GBP may be a kind of test of the credibility of the economies in the eyes of investors. Their abandonment of investments in the EUR and GBP despite rising interest rates could be potentially worrying. Moreover, it could change the entire scene of the foreign exchange market. In the dollar index, the euro has a weighting of more than 57 percent, while the pound has a weighting of more than 11 percent. Together, these two currencies alone have a weighting of almost 70 percent. Since the beginning of the year, the euro against the U.S. dollar has lost almost 12 percent, and the British pound almost 13 percent. In contrast, since August 2021, the euro has lost almost 15 percent to the dollar, and the British pound less than 14 percent. Of the major currencies, only the Japanese yen has fared worse and has weakened by almost 20 percent against the U.S. dollar over the year. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Pound and euro similar to currencies of emerging markets?

Bed Bath & Beyond (BBBY) shares have gained 300% since the beginning of August after many previously opened short positions were closed. According to Seeking Alpha data, the short interest on BBBY currently stands at a whopping 41.9% (nearly half of the shares available for trading are sold short). At its peak, BBBY shares reached a price of $30. Today, however, they appear to be down almost 45% ahead of the market opening at 14:00 GMT+3 - this could be the company's worst day since its IPO in 1992. BBBY shares were already down almost 20% yesterday, as investors began to realise potential gains. One of those investors is celebrity billionaire investor Ryan Cohen. He sold his shares, earning $68.1 million (56% on invested capital). According to a report filed with the SEC, Cohen's RC Ventures sold millions of shares on Tuesday and Wednesday in a price range of $18.68 to $29.21. Since then, according to Bloomberg data, the activist investor has asked the company to consider selling the business, reached an agreement to add three independent directors to the board and pushed for the departure of CEO Mark Tritton. Shares also peaked in March 2022, when Cohen first disclosed a 9.8% stake in the company. "The ailing retailer’s share price rise of late has defied logic," - said Danni Hewson, an analyst at AJ Bell. The company has hired the law firm, Kirkland & Ellis, to help it deal with its hard-to-manage debt, media reports said yesterday. Kirkland & Ellis is a well-known advisory firm that plans to help its client by raising new funds and refinancing debt. Other so-called 'meme stocks' also fell on Friday before the open. GameStop (GME) lost 6.5% and AMC Entertainment Holdings (AMC) 4.7% at 14:00 GMT+3. Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Bed Bath & Beyond loses more than 45% before the open - the end of the short squeeze?

Since the beginning of July, the crypto market seemed to be on the rise. The largest tokens (BTC and ETH) at the local peak, gained around 35% and 101% respectively. However, today at 11:30 GMT+3 BTC is losing around 7.3% and ETH around 8%. Today, ETH broke through its price channel and the 20-day moving average. If the price does not return to the channel in the next couple of days, we will be able to say that a possible reversal of the short-term trend we mentioned in previous articles has taken place. Especially if this is confirmed by indicators such as the Wilder directional indicator. BTC has also moved far out of its price channel and is currently below the 10, 20 and 50-day moving averages. The directional indicator has already shown a potential trend reversal and the MACD is approaching the negative zone. Today on the Conotoxia MT5 platform at 11:00 GMT+3, Filecoin (FIL) is down the most. It is experiencing a loss of almost 18%. According to Coinmarketcap, it has a capitalisation of almost $1.8 billion and a daily volume of over $511 million. Filecoin was launched in 2020 to decentralise data storage, providing an alternative to industry giants such as Amazon and Alibaba at a cost reduction of almost 99%. The project's network connects storage providers with customers looking for a place to keep their data. Those offering their storage from laptops to server rooms after verifying data integrity and security can obtain a FIL token as a reward. This creates a highly diversified and low-cost database network. However, the characteristics of the project are inherently inflationary, unlike BTC. The declines described are attributed to a broad market correction, the exit of 'big money' and growing pessimism about the increasing supply of FIL tokens. Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: The crypto market falls as profits are realised

Inflation in the Eurozone appears to be rising steadily, which may be influenced by the rising cost of electricity and energy carriers. Today's release of producer prices in Germany suggests that the peak of inflation in the Eurozone may be yet to come. Germany is the eurozone's largest economy, so published readings for that economy could heavily influence data for the community as a whole. Energy for businesses rose by 105 percent. Today we learned that in July producer prices (PPI inflation) rose in Germany at the fastest pace on record. PPI inflation on an annualized basis was as high as 37.2 percent. A month earlier, price growth stood at 32.7 percent, while the market consensus was for inflation of 32 percent. Energy prices still seem to remain the main driver of producer costs. The cost of the aforementioned energy for businesses rose 105 percent compared to July 2021. Had it not been for this factor, producer prices could have risen much more slowly, by only 14.6 percent. - according to the published data. Entrepreneurs could translate such a significant increase in costs into their products, which could also raise consumer CPI inflation as a result. Hence, it is not impossible that a possible peak in inflation in the eurozone is yet to come. It could fall in the last quarter of this year, or early next year, assuming that energy prices begin to stabilize or fall. Otherwise, the eurozone economy could plunge into a deep crisis. EUR/USD near parity again The rate of the EUR/USD pair fell today to 1.0084 (yesterday it was around 1.0200) and again approached parity at 1.0000. Concerns about the eurozone economy may be reflected in the exchange rate. However, it seems that the reaction to negative data is becoming less and less, as if the market has to some extent already discounted some of the bad news that may come in the near future. The European Central Bank's forthcoming actions may put the brakes on the euro's sell-off. According to the interest rate market, the ECB may opt for two rate hikes of 50 basis points each this fall. The market assumes that the ECB will raise the main interest rate to 1.5 percent throughout the cycle. Unlike the Fed, which may reduce the pace of hikes at the end of the year, the ECB may only move with a rapid increase in interest rates. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: PPI inflation in Germany highest on record. Euro under pressure

NetEase is a Chinese technology company that operates in three segments - online games, search engine (Youdao) and online music (Cloud Music). The company operates both in China and internationally. It is famous for games such as 'The Lord of the Rings: Rise to War', 'Vikingard', 'Lifeafter' and 'Knives Out'. Its shares have fallen more than 10% since the beginning of the year, along with other companies in the Chinese technology sector, by the Chinese government's ambiguous action in the area of interference in their operations, fears of delisting in the US and deteriorating economic indicators in China. However, it is fair to say that its price has still proved to be far more resilient to the issues mentioned above than those of Tencent, Alibaba and Baidu. The company's revenue was 23.2 billion renminbi (US$3.5 billion) in the second quarter, growing 12.8 % year-on-year, slightly beating Wall Street analysts' expectations. Cloud Music revenue grew the most to 2.2 billion renminbi ($327.2 million), rising 29.5% year on year. Online gaming remains the most important revenue stream, with Q2 revenue of 18.1 billion renminbi ($2.7 billion). This increased by 15% compared to the same period a year ago. This was mainly due to the debut of Diablo Immortal, co-developed by NetEase with Blizzard Entertainment. According to the company's report, it became the most downloaded game on the IOS platform in some regions. Major franchise titles had their longevity extended, including the fantasy series Westward Journey and Westward Journey Online, as well as Identity V and Infinite Lagrange. "Players continued to gravitate to our longstanding games in the second quarter, highlighting our strength in game operations longevity. Moreover, the launch of Diablo® Immortal™ attracted the attention of gamers around the world, showcasing our exceptional mobile game development capabilities" - stated CEO William Ding. Revenue fell sharply in the Youdao area, down 29.5% year on year. However, this is the smallest source of revenue and only amounted to 956.2 million renminbi ($142.8 million) in the quarter. Q2 saw a net profit of $790 million, due to lower costs of player retention costs compared to new player acquisitions. Earnings per share (EPS) for those listed in New York were $1.22 on an adjusted basis, beating analysts' estimates by 17 cents. NetEase shares gained almost 3% before the market opened. Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: NetEase increases profits despite declining revenues

Last night's publication of the minutes of the last Fed meeting, which took place at the end of July, may have affected the US dollar's trading. The policymakers touched on the regulation of the digital asset market for the first time at such a meeting. According to the published minutes, Fed officials remain very attentive to inflation risks and are committed to lowering price growth and keeping inflation expectations under control. A commitment to tightening monetary policy can take place, even if it comes at the expense of economic growth, the FOMC minutes show. The July discussion touched on the possible risks of too many and too large interest rate hikes. There was also talk that the Fed may be pursuing too much restrictive monetary policy than is necessary to restore price stability in the economy. The Fed, for the moment, seems unconcerned about GDP data and the risk of a sustained slowdown or official recession, as officials said the economy is stable for now, pointing to strong job growth, a low unemployment rate and elevated wage growth. Moreover, there was also discussion of the possibility of a later upward revision of earlier GDP readings, which are revised over time. There was also a statement regarding possible further action by the Federal Reserve. Policymakers discussed the possibility of slowing the pace of interest rate hikes at some point, but this will require data readings that can be considered satisfactory in terms of the impact of current hikes on slowing inflation. Meanwhile, for the moment, it may be crucial to maintain a restrictive stance to avoid a loosening of inflation expectations. Initially, after the release of the minutes, the EUR/USD exchange rate rose to 1.0200, before retreating to the region of 1.0150 this morning. The reaction thus appears to be mixed, without leading to a major impulse, and the exchange rate of the main currency pair has remained in consolidation since the morning of August 16. On Wall Street, on the other hand, indexes were down after the publication. The S&P500 fell 0.3 percent and the Nasdaq 100 fell 0.6 percent. The committee also turned its attention to the world of digital assets. Participants recognized the growing importance of digital assets and their increasing interconnectedness with other segments of the financial system, underscoring the need to establish a robust supervisory and regulatory framework for the sector to adequately mitigate potential systemic risks. Several participants mentioned the need to strengthen supervision and regulation of certain types of non-bank financial institutions, according to published minutes. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Highlights from the Fed minutes

Michael Burry is a well-known US investor who became famous for betting on the collapse of the US real estate market and the burst of the bubble in 2008. On 15 August, he filed a 13F form with the Securities and Exchange Commission (SEC), revealing the positions of his fund, Scion Asset Management. To the surprise of many, the investment portfolio turned out to be almost completely empty. Burry held shares worth 165 million at the end of the first quarter. These included companies such as Google, Meta and Stellantis. However, the latest report filed with the regulator revealed that all of it had been sold and the glorified investor's only long position is in GeoGroup, a company involved in running private prisons, but the value of the position is negligible at just under $3.31 million. The investor has recently been posting a number of tweets suggesting the end of the bear market rally. This has sent shock waves across the market, as the investment manager has usually been successful in predicting the market moves, famous for his incisiveness. If there were to be large declines in the broad traditional market, e.g. equities, what could this mean for crypto? The correlation between BTC and the Nasdaq 100 seems to be apparent, but after the last all-time high reading of 0.84 in May, it dropped to around 0.48 at the end of June. What is unfortunate, however, is that the correlation has been rising with subsequent waves of declines and peaked near local lows. If the stock market were to actually experience a crash, a strong reaction from the crypto market can be expected. The recent increase in correlation may be due to the increasing participation of token trading institutions. Michael Burry's attitude was addressed by Mati Greenspan CEO of Quantum Economic, stating that predicting the timing and scale of a crash is almost impossible. "Predicting a stock crash is a lot like predicting an earthquake. You know one will happen every so often but you can never tell exactly when or how severe it will be" - Greenspan said. On the Conotoxia MT5 platform, BTC is seeing its fourth day of decline, losing more than 0.7% at 10:30 GMT+3, while ETH is gaining less than 0.3%, drawing its first upward candle in three days. Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Michael Burry closed almost all his positions - what could another stock market crash mean for crypto?

The Reserve Bank of New Zealand today raised its main interest rate by 0.5 percentage points, to 3 percent, a level last seen seven years ago. It was the fourth 50-basis point hike in the current cycle, which may make the RBNZ one of the stronger monetary tightening central banks to bring down inflation.   Today's hike was in line with market expectations. Some policymakers believe that inflation may soon begin to stabilize or even start to decline through lower fuel prices and transportation prices. However, inflation may not return to the New Zealand central bank's target until mid-2024. Thus, further monetary tightening may be required, with its end expected in the first quarter of 2023 - according to a statement issued to today's decision. As a result, the RBNZ may raise the main interest rate by about 3.75 percentage points throughout the cycle, to 4 percent, from the record low of 0.25 percent that occurred in 2021. Inflation in New Zealand rose to 7.3 percent y/y in the second quarter of 2022, up from 6.9 percent in the previous period. This was the highest figure since the second quarter of 1990.   The NZD/USD exchange rate seemed to react relatively calmly to the above decision, as it was in line with the market consensus. At 07:30 GMT+3 on the Conotoxia MT5 platform, the NZD/USD exchange rate rose by 0.25 percent, to 0.6360. As a result, at this hour, of the major currencies against the US dollar, it is the NZD that seems to have gained the most. Since the beginning of the month, the NZD has gained 1.10 percent to the USD, which may make New Zealand's currency the strongest of the world's major currencies.   Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Bank of New Zealand with another rate hike

Home Depot (HD) and Walmart (WMT) are among the largest US retailers whose results seem to show the attitude of the average American consumer towards spending money. HD is a chain of large-format home improvement shops, very similar to Europe's Leroy Merlin. WMT, on the other hand, is the largest US retail chain. Last month, Walmart spooked markets by lowering its profit forecasts and warned of a rapid decline in demand. However, the results announced today said sales were up more than 8% year-on-year to $152.9 billion against expectations of $150.8 billion. Online sales alone rose by as much as 12%. The company is struggling with a gigantic inventory problem (worth $61 billion at the end of Q1), prominent among the backlog of products is apparel, for example. To deal with this, discounts have been introduced on many products, thereby boosting sales by stimulating demand. At present, the value of stock amounts to USD 59.9 billion. However, the increased sales do not translate directly into profits. "The actions we’ve taken to improve inventory levels in the US, along with a heavier mix of sales in grocery, put pressure on the profit margin for Q2 and our outlook for the year," - CEO Doug McMillon said. Walmart's second-quarter net income rose to $5.15bn, or $1.77 per share (EPS) against Wall Street analysts' estimates of $1.62. In the same period a year ago, net income was $4.28bn, or $1.52 per share (EPS). Walmart maintained its forecast for the second half of the year. It expects US shop sales to grow by about 3% (excluding fuel), in the second half of the year, or about 4 per cent for the full year. It expects adjusted earnings per share to decline 9% for the year. Home Depot also announced a 5.8% increase in sales, to 43.8 billion against expectations of $43.36 billion. Net sales were up 6.5% year-over-year, marking the highest quarterly sales in the company's history. "Our team has done a fantastic job serving our customers while continuing to navigate a challenging and dynamic environment," - CEO Ted Decker said, commenting on the company's results. Net income increased to $5.17 billion, up 7.6% year-over-year. EPS was $5.05 against analysts' forecasts of $4.94. Walmart and Home Depot gain 4.7% and 1.9%, respectively, on the market open. The retailers' results show that, despite the looming recession, consumers are spending money and the situation could be not that bad in the short term. However, at the same time, the figures for financing this spending are alarming. A large proportion of Americans are covering higher prices with credit cards, which must eventually be repaid, according to data published by Bloomberg. The worsening outlook for economic health, alarming PMI levels and the bond yield curve all translate into possible future deterioration in consumer health.   Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.  Source: Retailers announce strong results - shares rise

The price of WTI crude oil remained below $90 per barrel at the beginning of the week, the level before Russia's attack on Ukraine. Oil today is the cheapest in six months. It seems that the topic of a global economic slowdown or recession and how long it may last may be important for the oil market. Chinese and U.S. economic data seem to show a weaker condition in both economies and thus could affect the decline in oil demand. This, in turn, could put downward pressure on prices. According to published data, factory activity in China declined enough in July to force the central bank to cut lending rates to keep demand from collapsing. In the United States, on the other hand, the market may have been taken by surprise by the second-largest drop in the history of the New York Empire State Manufacturing Index. The above indicators may affect the market from the demand side, but this is only one part of the puzzle. On the supply side, long-awaited changes may be brewing. Once the embargo is lifted, oil from Iran may start flowing into the market again. Iran has responded to the European Union's proposal. It may seek to re-implement the 2015 nuclear agreement. The EU is also calling on the US to show more flexibility in implementing the agreement. Saudi Arabia may also be preparing to increase its oil supply. The chairman of Saudi Aramco, the state-owned oil giant, stated over the weekend that his company is ready to increase production to 12 million barrels per day, the company's current production capacity limit. Only a decision by the Saudi Arabian government is needed to increase production. According to the EIA agency's forecast, the United States can also increase its production. US oil production in the August forecast averages 11.9 million barrels per day (b/d) in 2022. It could rise to 12.7 million b/d in 2023. If this forecast comes true, the US could set a production record next year. The current one is 12.3 million b/d and was set in 2019.   Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Source: Oil near six-month lows

Germany's Siemens, a manufacturer of technology to automate and digitalise businesses and households by supplying hydraulic, electrical and electronic equipment and household appliances, today reported revenue growth of 27% (year-on-year) and 1% growth between quarters. What happened? This exceeded analysts' expectations of €17.47 billion, reaching €17.87 billion in Q3 (the financial year starts earlier than the calendar year). This growth was mainly attributed to an increase in orders from the areas of business automation and intelligent infrastructure.   "Demand in the European capital goods sector is holding up," commented Barclays last week, following the publication of results from other companies in the sector, such as ABB and Schneider Electric. This was also confirmed by CEO Roland Busch, who said that demand remained strong in the quarter despite an environment affected by sanctions on Russia, high inflation and the ongoing effects of a pandemic. However, it is worth noting that these companies typically operate on long-term contracts and the decline in demand can be noticed after a long delay.    Siemens has a strongly diversified business, not only in terms of products but also in respect of the countries of origin of its customers. However, this may not protect it from the looming recession, which seems to be a problem not only for Europe or the US but for the whole world.    Alarming are, for example, the data of the German manufacturing PMI (Purchasing Managers' Index), which measures the assessment of the economic situation by managers. This index is currently at almost its lowest level in two years. The results in other countries in Europe and America also look similar. Asian economies also appear to be weakening.   Siemens also incurred a net loss of €1.66 billion charge for the write-down of the value of its stake in Siemens Energy, which operated in Russia. In addition, the company estimates that it has incurred additional losses of €0.6 billion due to the actions of the Russian Federation.   Despite high energy prices, Siemens is struggling to make savings from its 35% stake in the turbine and wind energy company. It has had a difficult two years since the spin-off in 2020, with operational problems and losses in the Siemens Gamesa wind turbine division.   Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service)   Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.   CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Siemens posted its first loss since 2010, yet shares are gaining

US Inflation Yesterday, the US inflation report was released, which came in at 8.5% in July. The market did not expect such a large drop, estimating a level of 8.7% before the data was released. The stock markets reacted positively and the major equity indexes rose significantly. The S&P 500 gained more than 2.1% during yesterday's session and the Nasdaq almost 2.9%. Crypto Cryptocurrencies, however, reacted most noticeably - on the Conotoxia MT5 platform, Bitcoin gained around 3.3% yesterday. And today, it continues its rise, breaking through the local peak of $2,485 on 30 August 2022. At 11.30 am GMT+3, the price of BTC is $24,471. The ETH price has risen even more strongly after a surprisingly low inflation reading. Ethereum gained more than 8.5% yesterday, and at 11.30 GMT+3, it is already up more than 2.3%. The token already costs $1,887 - its highest recorded level since 6 June this year.    What to expect? The market's reaction has a lot to do with expectations of interest rate hikes, which fell after the US inflation reading. However, it is still a long way from calling it a permanent decline. Inflation is still at its highest level in decades and the economy is operating in an environment of negative real interest rates.   According to CME Group data, the Federal Reserve (Fed) is likely to push rates even higher. Currently, the Fed Funds Rate is at just 2.5 pp, the level before the Covid pandemic. The CME Group estimates that we will still reach the 3.25 pp level this year, and peak in 2023 at 3.5 pp. However, as for the 2023 projections. The Federal Open Market Committee (FOMC), which decides them, is already much less unanimous and a lot may still depend on the information coming out of the economy.   Information on its state in the US is not pleasing. Most metrics - such as the yield curve, consumer sentiment, and economic growth - point to a recession. The labour market, which is surprisingly strong at the moment, is reacting last and is likely to become further evidence of a crisis soon.   The cryptocurrency market has never been in such a severe recession, so it is hard to determine exactly how it will behave. For now, the data shows a relatively high level of correlation between it and the stock market. This is not good news, as the latter almost always loses in a crash.   Polygon (MATIC) is an Ethereum token that powers the Polygon network, which is a protocol for building Ethereum-compatible blockchains and decentralised applications (DApps). Polygon is also referred to as a 2nd level (2nd level) solution to help Ethereum to scale faster, by increasing the efficiency of the network.    On Wednesday, Polygon shared data on user growth. Their total number in July was 11,800, gaining 47.5% since March and up 400% year-to-date. Interestingly, according to the project, "74% of teams integrated exclusively on Polygon, while 26% deployed on both Polygon and Ethereum,". This shows a very high level of confidence in the new technology, which can be the new foundation for the development of DApps. Since the local low on 19 July this year. MATIC has risen almost 172%.  Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service)   Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.   CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Crypto soars after the low inflation reading. Polygon grows rapidly, gaining 400% users

Coinbase, the world's second-largest cryptocurrency exchange by volume, with a 24-hour trading volume of nearly $2B yesterday alone, is going through a lot of trouble due to SEC investigations into the company's operations and alleged insider trading. Since the beginning of the year, its stock has fallen as much as 65%, likely due to a drop in trading volume, investor pessimism, historic declines in token prices, and mentioned investigations. "Q2 was a test of durability for crypto companies and a complex quarter overall. Dramatic market movements shifted user behaviour and trading volume, which impacted transaction revenue, but also highlighted the strength of our risk management program," Coinbase said. COIN reported $217 billion in sales for the quarter, losing nearly $100 billion compared to Q1 2022 ($309 billion). Revenue also fell to 803 million against Wall Street's forecast of $873.8 million from more than $2 billion a year ago. The drop in stock prices was not saved by a beat in earnings per share (EPS) expectations, which came in at -$0.87 vs. the expected -$1.23. The stock market's shares buckled, falling 10.5% during yesterday's session. Coinbase's results may have confirmed concerns about the current situation of crypto companies and how the crash contributed to the loss of project revenues and lowered expectations for growth. The situation was commented on by Morningstar equity analyst Michael Miller, who said in an interview with Reuters: "Coinbase has not seen a mass migration from its platform [...], its users are becoming more passive in investing in cryptocurrencies." There seems to be a lot of truth in this. Investors with significant unrealized losses tend to be more willing to wait out a difficult period and limit their activity, while new buyers are likely to be among those who have been waiting for token prices to fall for a long time and have a long-term investment perspective, so they don't trade as actively. It's hard to determine how much of an impact Coinbase's poor performance had on the cryptocurrency market. That's because it coincided with a local correction. What we do know, however, is that the listings of tokens such as BNB (owned by the Binance exchange) and KCS (KuCoin exchange) saw the biggest declines and daily minimums after the COIN results were announced. Currently, Coinbase seems to be distancing itself from competitors such as FTX, Binance, Kraken and KuCoin, which are maintaining a higher growth rate along with a high level of service. Binance alone dwarfs the rest with nearly 21 million visits in the last week and more trading volume than the top 5 competitors in this category combined. Today, the broad crypto market is seeing slight declines. Bitcoin and Ethereum at 12:00 GMT+3 are losing 0.5% and 0.05% respectively, developing a local consolidation. ZCash, which was designed on the basis of Bitcoin, is falling the hardest. It has had several technological solutions added to it, notably affecting a higher level of security and anonymity of transactions. The token has developed strong momentum in recent days, gaining about 18% on the Conotoxia MT5 platform since the beginning of August, followed by a correction today, with (12:00 GMT+3 ) ZCash falling about 8%.   Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Coinbase shares slide after second-quarter revenue decline. Tokens in consolidation (conotoxia.com)

What is happening? The CEO of the world's largest electric car company has sold about $8.4 billion worth of Tesla shares over the past week. According to documents provided to regulators, the series of transactions took place between August 5 and 9, 2022, shortly after the August 4 shareholder meeting in Austin. As recently as April of this year, the Tesla and SpaceX CEO wrote that he "has no plans for another stock sale," after divesting a stake worth $8.5 billion to buy Twitter. This is not the first time Elon Musk has confused his public. The businessman seems to frequently abuse his influence, throwing around bold statements and increasing the expectations of his followers. When asked recently if he had stopped selling Tesla, for the time being, he replied "yes. In the (hopefully unlikely) event that Twitter forces this deal to close *and* some equity partners don’t come through, it is important to avoid an emergency sale of Tesla stock." However, it's hard not to get the impression that the CEO is simply taking advantage of the recent rebound in the share price. It is possible that his goal is not just to finance the deal, but to try to protect his private fortune. Such a major sale of an important shareholder had a significant impact on both Twitter and Tesla's stock price. Elon Musk failure or a smart plan? Twitter rose at the opening by almost 4%, thanks to the increasing likelihood of the deal being finalized, which may have been due to Musk's recent tweet. Most of the news coming out of the courtroom also reinforces analysts' belief that the Tesla CEO will be forced to buy the company. The platform's stock price has gained more than 35% over the past month, with a price target. Tesla, influenced by the news of the sale of a large stake by the most important person in the company, has lost around 7% over the past four sessions. The company itself gained more than 44% from its July 16 bottom to its August 4 peak at the shareholder meeting. Tesla, like many technology companies, has gained significantly from the recent bear market rally. This growth can also be attributed to Tesla's results, in which it beat expectations for earnings per share (EPS) by more than 26%. However, the macroeconomic analysis is rather pessimistic for the electromobility market in the short and midterm. During recessions, companies are usually unable to achieve high expected growth rates by falling consumer demand. More often than not, revenues fall, profits decline, and as a result, stock prices fall as well.   RafaÅ‚ Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.   Source: Elon Musk sells nearly 8 million Tesla shares, justifying it by the Twitter lawsuit

Bed Bath & Beyond(BBBY), AMC Entertainment (AMC) and GameStop (GME) have again become targets of speculation by retail investors. The share price of the companies above had risen 138%, 60%, and 34%, respectively, in the past month as of 1:00 p.m., ahead of Tuesday's opening of the US stock market. The first is engaged in the sale of home accessories, the second is a well-known cinema chain, and the third is a popular chain of stationery stores for games and electronic devices. Most likely, we can already talk about the phenomenon of a short squeeze on these shares. It involves "squeezing" short-sellers by elevating the price and forcing them to close their positions at a loss by buying back shares and pushing the price even higher. Retail investors have been popularizing BBBY, AMC and GME for months in an effort to take advantage of the excessive short positions of institutions. The short squeeze would undoubtedly be hampered if we saw massive declines of indexes. However, exaggerated optimism during the current bear market rally may have caused a rise in valuations beyond their legitimate levels, and secondly, a herding effect that could prove tragic for short sellers. Recent increases in major global markets, especially the US, are most likely due to investors' over-optimism and the rebound from the declines of the first half of 2022. An important factor here is the expectation of falling inflation in July. However, the current situation resembles most of the bull traps of the early recessions. Rallies of several dozen per cent are their bread and butter. Short-sellers of the mentioned stocks are most likely experiencing a large unrealized loss and are afraid of further price pumping, not knowing where the limit of madness lies. Moreover, they know that by closing the position, they could elevate the price even further. So they are faced with the following dilemma - is it better to close positions now when others taking a short position have not managed to do so and the price still has not shot up? In the perspective of a fundamentally bad macroeconomic environment, such upswings could foreshadow a big collapse in the valuations of the "meme stocks", as more bad data starts pouring in from the economy in the coming quarters. However, it is unclear where the limit of these speculative gains lies.     Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Bed Bath & Beyond gains nearly 138% in a month - "meme stocks" on Wall Street's lips again (conotoxia.com)

On Monday, U.S. Secretary of State Antony Blinken tweeted about sanctioning the Tornado Cash cryptocurrency, which he called a "state-sponsored hacking group, used by the DPRK to launder money." The Secretary's statement went viral due to his bold allegations about the project's founders. Just a little over an hour later, he deleted the post, replacing it with the more reserved information that Tornado Cash was simply "used by DPRK-linked hacking groups." Blinken made no reference in the new entry to the one removed an hour earlier. The posts were related to an ongoing investigation by the Treasury Department's Office of Foreign Asset Control (OFAC) into money laundering. The token in question was blacklisted, providing the ability to cover up traces of cryptocurrency transfers and thus increase the level of privacy of transactions. Currently, 40 Ethereum and USDC addresses linked to the project's activities have been identified. According to the agency, the Tornado Cash solution was used by the Lazarus Group, a DPRK hacking group that moved out $625 million in cryptocurrencies stolen in hacking attacks in recent years. The project has been blacklisted by the US Treasury. This means a complete ban on the use of the token and related addresses by Americans. Blender.io, another project that enhances the privacy of transactions, was also shut off earlier. "Tornado Cash has been the go-to mixer for cybercriminals looking to launder the proceeds of crime, as well as helping to enable hackers, including those currently under U.S. sanctions, to launder the proceeds of their cybercrimes by covering up the origin and transfer of this illicit virtual currency" - The senior Treasury official said. He then added, "Since its creation back in 2019, Tornado Cash has reportedly laundered more than $7 billion worth of virtual currency,". Tornado Cash (TORN) has lost nearly 28% in the last 24 hours, according to CoinGecko. Hackers return funds and recommend more caution for Nomad Less than a month after ignoring warnings from audit firm Quantstamp, an exploit in the Nomad protocol was discovered and used to move out more than $190 million. The entire operation took less than three hours. White hat hackers quickly joined the thieves in an effort to seize as much of the money as possible and protect users' funds from real criminals. Within hours of publishing a wallet to which Nomad accepts the return of stolen funds, the white hacking group returned $32.6 million of the stolen $190 million. Most of the funds were denominated in USD Coin (USDC), Tether (USDT) and Frax. Unfortunately, it is still unclear how much money they managed to protect from the stolen 190 million. Nomad expects further returns. Bitcoin, along with Ethereum, are deteriorating after recent increases. Some tokens are experiencing minimal losses. On the Conotoxia MT5 platform, BTC is losing 1.5% and ETH is losing 1.9% as of 11:30 GMT+3.     RafaÅ‚ Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Tornado Cash was banned for facilitating money laundering. Hackers return more than $32 million to Nomad Bridge (conotoxia.com)

Berkshire Hathaway is a holding company that operates as an investment vehicle for well-known investor Warren Buffett. The company has exposure to industries such as freight, insurance, energy, food and more. Berkshire's strategy for years has been to buy attractively valued companies. BH then restructured them, improving efficiency and investing in key areas of the business, resulting in a high potential return on investment. Accordingly, earnings per share (EPS) also seemed to be a big surprise The company's operating profit was $9.3 billion in the second quarter, beating Wall Street analysts' expectations. That's an increase of 39%, taking into account the $6.7 billion profit from a year ago. Accordingly, earnings per share (EPS) also seemed to be a big surprise. It came in at $6,312 (43% year-on-year growth) versus the expected $5,393. This was attributed to the good condition of the insurance and rail transportation businesses in particular. The company continued its slow share buybacks, allocating $1 billion, down sharply from $3.2 billion a year ago. Warren Buffett appears to be cautious about carrying out buybacks. According to Barron's data, the company did not buy back any shares in April and May, when their price was near historic highs. Buybacks resumed in July when the shares tumbled. The company posted a gigantic $43.8 billion loss on investments Despite excellent operating results, the company posted a gigantic $43.8 billion loss on investments. This caused up to 21% declines in the value of shares of Berkshire's three major portfolio companies - Apple, Bank of America and American Express. Warren Buffett asked investors not to focus on quarterly fluctuations. This relates to Warren Buffett's long-term value-type strategy of investing for the long term and not paying much attention to volatility. The main measure is the fundamental value of a company. “The amount of investment gains/losses in any given quarter is usually meaningless and delivers figures for net earnings per share that can be extremely misleading to investors who have little or no knowledge of accounting rules,” the board announced in a statement. The conglomerate's Class A shares (main shares issued) fell more than 22% in the second quarter. Berkshire continues to beat the market, losing 2.5% over the year, while the S&P 500 is down 13.5%. All three recommendations gathered by MarketScreener say "buy" or "hold." Their average target price is $525.03k, implying a potential upside of 19.5% from the current price. In addition to the main Class A shares, Class B shares (in the form of CFDs and DMAs) are available on the Conotoxia MT5 platform, whose closing price on Friday did not exceed $300. RafaÅ‚ Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

After the U.S. labor market data released on Friday, which surprised positively, surpassing the market consensus, investors' attention may turn to the U.S. inflation reading. The labor market and inflation may determine further Fed actions, and thus indirectly influence the behavior of many asset classes. On Wednesday, August 10 at 2:30 pm (GMT+2), US inflation data for July will be published. According to the market consensus, price dynamics in the US may have slowed its growth due to recent reductions in the cost of gasoline refueling. Economists seem to assume that U.S. prices may have increased by 0.2 percent on a monthly basis, which would be the smallest increase since January 2021. On a year-on-year basis, July was expected to bring inflation to 8.7 percent, compared to 9.1 percent in June, according to market consensus. Core inflation could rise by 0.5 percent m/m and 6.1 percent y/y. It seems that, among other things, the inflation data may determine the Fed's further actions, and before that, the market's attempt to estimate them. According to the valuation of federal funds rate futures, there could be another 0.75 percentage point rate hike in September. Then the range would be 3.00-3.25 percent, and the probability of such an action is estimated at 68 percent. US dollar may be approaching the point where it may stop reacting so strongly to the data From the perspective of financial markets, the US dollar may be approaching the point where it may stop reacting so strongly to the data. Namely, good data from the labor market, an increase in expectations for another interest rate hike, seem to no longer make much of an impression on the US currency. The EUR/USD exchange rate thus continued to stay in consolidation between 1.01-1.03 in the past days. As a result, the market may be waiting for a breakout and determining where, if any, it would like to head next. It's not only the United States that may draw investors' attention this week, but also the United Kingdom. Following the Bank of England's recent decision and the release of estimates for an economy that may be slipping into recession, the market may be looking at data to confirm this. This week, according to preliminary data, it may turn out that the British economy contracted by 0.2 percent between April and June. It seems that the main reason for the decline in GDP may turn out to be demand-dampening increases: energy prices and taxes. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

US labor market data released this afternoon beat market expectations, surprising with a positive reading. This may have implications for further monetary policy tightening in the United States. As reported by the U.S. Labor Department, total employment rose by 528000 in July, and the unemployment rate fell to 3.5 percent. The market consensus was for employment growth to reach 250,000, while the unemployment rate settled at 3.6 percent. The published employment growth was recorded in a number of sectors, but the publication's result was mainly influenced by employment growth in leisure and hospitality, professional and business services and health care. As a result, according to BLS data, both total non-farm employment and the unemployment rate returned to pre-pandemic levels in February 2020. The July data also showed the largest increase in employment since March 2022. Not only did the NFP come in better than market expectations, but also a number of other macroeconomic data released at 2:30 p.m. today. Average hourly earnings rose at an annual rate of 5.2 percent in July against a consensus of 4.9 percent, while average hourly earnings in June rose 0.5 percent against a consensus of 0.3 percent. It appears that the better-than-market expectations data may influence the following decisions of the Federal Reserve, for which, along with inflation, the labor market is a priority, as a result of the Fed's dual mandate. According to Bloomberg, the interest rate market began to price in the possibility of another 75 basis point interest rate hike rather than a 50 basis point hike with greater probability after the labor market data. Greater potential monetary tightening in the U.S. than was thought before the data was released could influence a number of markets. The reaction after 2:30 p.m. seems to be evident in the quotations of the US dollar or stock market indices. The rate of the EUR/USD pair between 2:30 and 3:30 p.m. dropped from 1.0235 to 1.0155, while the quotes of Nasdaq 100 seemed to fall from 13320 points to 13090 points. Gold fell from around $1,790 to $1,770 during this period. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. US labor market data surprised positively (conotoxia.com)

Recent weeks have seen a sharp decline in indexes showing consumer sentiment on both sides of the Atlantic. It seems that the war, inflation and interest rate hikes or their announcements are effectively holding back consumer demand, which in turn could be reflected in an expected stagflation or recession. Data on consumer attitudes toward spending their money was confirmed yesterday by US retail giant Walmart. Walmart has more than 10000 stores and numerous eCommerce sites, with some 230 million customers from 24 countries visiting each week. With fiscal year 2022 revenues of $573 billion, Walmart employs about 2.3 million workers worldwide. Yesterday, after the session, the company noted that consumers are reducing their spending due to rising prices. Customers are focusing on necessities, including food, while spending less on clothing or electronics, the company reported. Thus, Walmart slashed its quarterly and annual earnings estimate expectations. As a result, the company's share price fell about 10 percent in after-session trading, dragging other retail-oriented companies down with it. Target fell by more than 5 percent, Macy's by more than 4 percent, and Amazon by more than 3 percent. Soon the companies will publish results: Alphabet, Microsoft, Visa, Coca-Cola and McDonald's. In the commodities market, WTI crude oil futures rose above $98 per barrel on Tuesday. Tensions between the West and Russia remain elevated as G7 countries prepare to impose a price cap on Russian oil, but Moscow has rejected such plans and said it will not supply oil to countries that impose such restrictions. Russia's Gazprom has also announced that supplies through the Nord Stream 1 pipeline to Germany will drop to just 20 percent of capacity, which could fuel a shift from gas to oil as an energy source, possibly driving up prices. Meanwhile, recent data from the U.S. and Europe already point to an economic slowdown, with China chafing at an economic contraction in the second quarter. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read more on Conotoxia

The price of WTI crude oil is trading below the $100 per barrel level this morning, marking the lowest level since April 2022. Yesterday, the price of oil fell by 8%. The recent pullback in the price of black gold may be a consequence of growing investor fears that the global, and especially European, economy will fall into recession. Added to this are further restrictions related to new COVID-19 outbreaks in China, as well as the strongest US dollar in 20 years. US Inflation U.S. inflation data will be released today, which could reach 8.8 percent, which would mark the fastest price increase since 1981. However, core inflation is expected to fall for another month in a row from 6 to 5.7 percent. The peak of core inflation in the U.S. was in March, when it was 6.5 percent. However, it seems that the Federal Reserve is not going to change its plans for another 75-basis-point interest rate hike, which in turn could increase fears of a recession and put pressure on oil prices. Another potential drag on the market could have been the API report, which showed that crude oil inventories rose by 4.76 million barrels last week. Distillate and gasoline stocks rose by 3 and 3.3 million barrels, respectively. 2023 In Eyes Of OPEC OPEC estimates that oil demand will increase in 2023, but at a lower rate than in 2022. This may be supported by an expected recovery in the economy from a slowdown or recession in 2022 and an improvement in the coronavirus outbreak in China. Moreover, this week, US President Joe Biden may push for increased production from Saudi Arabia, on the occasion of a planned visit to the country, to lower crude prices. A drop in oil prices, but also in other commodities, including industrial metals, may favor lower inflation expectations. This, in turn, could cause the market to talk more and more about a potential pause in the Fed's monetary tightening efforts. Should this actually happen, some financial markets could catch their breath, after a disastrous first half of the year. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The index of the US currency is at levels last seen 20 years ago, and the rate of the EUR/USD pair is literally rubbing against the 1.00 level. The USD thus does not give up, remaining the strongest currency among the world's major currencies. US Dollar Index (DXY) The US Dollar Index on Tuesday morning is already above the level of 108 points. Investors can still report demand for the safe-haven currency at a time of high economic uncertainty. Moreover, the U.S. economy can handle an impending slowdown or recession better than the economies of other countries, especially developing ones. In addition, the dollar is used for international settlements, and an increasing number of countries are experiencing trade balance problems and are beginning to import goods of increasing value with a falling ratio of that value to exports, which could further drive demand for the USD. Federal Reserve Expectations are also not diminishing that the U.S. Federal Reserve will steadily raise the U.S. dollar interest rate in the near term after good labor market data and with expectations of again the highest inflation reading in more than 40 years in the U.S., which could happen later in the week. Raphael Bostic, president of the Atlanta Fed branch, said Monday that the pace of price increases justifies another 75 basis point rate hike later this month. Meanwhile, Esther George, president of the Kansas City Fed, who was an opponent of a 75 basis point hike last month, warned against sudden changes in rates that could hurt the economy and financial markets. According to the New York Fed's survey, median inflation expectations for the year ahead rose to 6.8 percent in June from 6.6 percent in May, a new record for the series. In contrast, median inflation expectations for the next three years fell to 3.6 percent from 3.9 percent. The market's measure of inflation expectations over a five-year period also appears to have fallen from its April peak of 2.67 percent to 2.08 percent. This may show that 2022 will be the year with a peak in interest rates and inflation, after which both inflation and interest rates would be expected to fall. EUR/USD At 07:30 on Tuesday, the EUR/USD pair price on the Conotoxia platform was above the parity level of 1.00, having remained there since the overnight hours. It seems that the entire investment world is looking at this level right now and what could possibly happen if it were broken. Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The energy crisis in Europe, the decline in the value of exports and the increase in the value of imports, as well as high expectations for interest rate hikes in the United States, may push the EUR/USD exchange rate ever more boldly towards 1.00. It now appears that the risk of a recession in the Eurozone compared to the United States is much greater than previously thought. The Eurozone could fall into stagflation, just as happened to the US economy in the 1970s-80s. What's more, Europe needs more dollars to import goods, especially energy resources, than it can get through exports. However, the situation becomes even more difficult as the Nord Stream 1 gas pipeline will be closed from today due to previously planned maintenance work. However, there is a risk that it will not open by the July 21 deadline as previously planned. Russia could use the maintenance work and its possible prolongation to blackmail Europe's energy. This, in turn, could throw the economy into big trouble and ultimately into recession. It will no longer be so much that gas will be expensive, but that it simply won't be there, which could limit production capacity and could lead to a sharp decline in economic growth. This could have a negative impact on the euro's valuation. Meanwhile, in the United States, the earnings season will begin this week, but inflation data will also be released. Already on Wall Street, PepsiCo will present its report on Tuesday, Delta Air Lines on Wednesday, JPMorgan Chase and Morgan Stanley on Thursday, and Wells Fargo, Citigroup and PNC Financial on Friday. Second-quarter earnings for the S&P 500 are expected to rise 5.7 percent, according to Refinitiv. U.S. inflation could rise to 8.8 percent, which would be the highest reading since December 1981, but core inflation is expected to slow for the third consecutive month from 6 percent to 5.8 percent. That, however, may not set back market expectations for a 0.75 percentage point rate hike overseas at the July meeting. Also, the fact that the yield curve is starting to invert again in the US, where interest rates on 2-year bonds appear to be higher than on 10-year bonds, may therefore not undo Fed policymakers' decision to raise interest rates further. In their view, inflation is mostly demand-driven, not energy costs. Raising interest rates could cause demand to be reduced, and U.S. consumers may start saving more than spending, which also threatens a U.S. recession.   Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service) Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.59% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The Reserve Bank of Australia raised the cash rate by 50 basis points to 1.35 percent at its July 2022 meeting. It was the third consecutive month of rate hikes, which are now at their highest level since May 2019. Policymakers cautioned that further tightening will continue in the coming months When announcing the decision on the cost of money, the central bank's board reiterated that massive monetary support was no longer ne