The European Central Bank (ECB) rose its three policy rates by 50bp at yesterday’s monetary policy meeting, versus 25bp expected by analysts. One of the major highlights of yesterday’s ECB decision was the anti-fragmentation tool, TPI, transmission protection instrument.
Transmission Protection Instrument
The name is fancy but what it could do to help the ECB is unsure for now, as the eligibility to the TPI sounds complicated - so complicated in fact that during her press conference yesterday, Christine Lagarde repeated ‘no, no it’s not that complicated’ several times when she answered questions. With the ECB shifting to rate-tightening phase, we have no more than Switzerland and Japan left in the negative rate territory.
The Swiss National Bank (SNB)
The Swiss National Bank (SNB) already surprised the market with a 50bp hike in its last meeting and pledged to do more, but the Bank of Japan (BoJ) maintained its policy unchanged yesterday, and said it has ‘absolutely no plan’ to raise the interest rates. The US dollar was softer yesterday, and the barrel of American crude slipped again below the $100 mark. US stocks gained, but Microsoft announced it will slow hiring in its security software unit and Azure cloud business in the foreseeable future. 7-Eleven also said it will cut around 880 jobs, and Snap announced it will slow its rate of hiring ‘substantially’, as well. Plus, Snap’s share price dived more than 26% in the afterhours trading after the company missed estimates on a major slowdown in the ad industry due to economic jitters.
The #EuropeanCentralBank (ECB) rose its three policy rates by 50bp at yesterday’s monetary policy meeting, versus 25bp expected by analysts.— Swissquote (@Swissquote) July 22, 2022
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Snap, Google (GOOGL), Meta (FB)
The Snap results came as a warning for other Big Tech names that rely on ad revenue. Therefore, FAANG stocks, which recovered to an almost 2-month high yesterday, may not extend gains to the weekly close as the latest Snap results could reverse appetite for at least a couple of them, including Google and Meta before the closing bell.
Watch the full episode to find out more!
- 0:00 Intro
- 0:35 ECB's new TPI tool doesn't convince much...
- 3:49 BoJ says' absolutely no plan' to tighten
- 5:01 Turkey plays with fire
- 5:51 Market update
- 7:20 Snap dives 26% post-earnings
- 8:02 Amazon buys One Medical
- 8:48 Fed meeting is the next big event!
Ipek Ozkardeskaya has begun her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked at HSBC Private Bank in Geneva in relation to high and ultra-high net worth clients. In 2012, she started as FX Strategist at Swissquote Bank. She worked as a Senior Market Analyst in London Capital Group in London and in Shanghai. She returned to Swissquote Bank as Senior Analyst in 2020. #ECB #TPI #rate #hike #EUR #BoJ #CBT #JPY #TRY #Snap #Amazon #OneMedical #acquisition #Tesla #Meta #Google #crude #oil #SPX #Dow #Nasdaq #investing #trading #equities #stocks #cryptocurrencies #FX #bonds #markets #news #Swissquote #MarketTalk #marketanalysis #marketcommentary _____ Learn the fundamentals of trading at your own pace with Swissquote's Education Center. Discover our online courses, webinars and eBooks: https://swq.ch/wr _____ Discover our brand and philosophy: https://swq.ch/wq Learn more about our employees: https://swq.ch/d5 _____ Let's stay connected: LinkedIn: https://swq.ch/cH