US open stocks set to retreat as WHO warns on covid numbers

US futures

Dow futures -0.2% at 31450

S&P futures -0.3% at 3889

Nasdaq futures -0.1% at 13268

In Europe

FTSE +0.5% at 6620

Dax +0.4% at 14070

Euro Stoxx +0.3% at 3719

Learn more about trading indices

WHO warns on rising covid cases

The World Health Organisation warned that new covid cases rose for the first time last week in 7 weeks. Cases rose in 4 or the WHO’s 6 regions. Despite recent encouraging developments on vaccine rollouts the WHO’s warning is a reminder that covid remains a clear risk.

The numbers come as parts of the US have started to ease restrictions and as the vaccine rollout is expected to pick up after the approval of the single shot Johnson & Johnson vaccine.

In Germany, non- essential shops could be reopened soon in areas where there is a low infection rate. German retail sales were dismal with sales dropping 4.5% MoM after declining -9.1% MoM in December.

The WHO added that it was premature to believe that the Covid health crisis would end this year which is keeping risk sentiment in check.

China regulator warns of bubble

China’s banking regulator warned over the risk of bubbles forming in foreign markets whilst also raising concerns over the Chinese housing sector. His comments sent Chinese stocks lower and dented sentiment on the open in Europe. The fact that markets are moving in an opposite direction to the underlying economies isn’t anything new. However it was enough to take the shine off stocks.

Stocks set to open mildly lower

The S&P 500 enjoyed its best session in 9 months on Monday boosted by JNJ vaccine & stimulus developments. However, the bulls are pausing for breath indicating mild losses on the open.

Retailers will be in focus as earning season continues. Nordstrom, Kohl and Target have reported earnings.

Target gains 0.2% pre-market after reporting a 21% jump in sales in the holiday quarter, signifycantly higher than forecast. The jump in sales came as same day delivery and in store collection services helped fulfill robust demand. Target has regularly outperformed Wall Street expectations thanks to its early focus on its digital offering.

Zoom rises pre-market after beating forecasts

Zoom trade +7% pre-market after posting impressive earnings after the close on Monday and issuing a strong guidance. Zoom achieved EPS $1.22 vs $0.79c expected. Revenue $882.5 million vs 811.8 million expected. Margins improved and Zoom lost fewer customers than it had expected. Zoom sees 42% revenue growth in the year ahead even as life return to sone form of pre-pandemic normalcy.

FX – EUR depressed as German retail sales plunge & inflation misses.

The US Dollar is extending 0.6% gains from the previous week. US Dollar Index DXY +0.15% holding above 91.00.

EUR/USD – trades under pressure owing to dismal German retail sales and softer inflation numbers. Eurozone CPI printed at 0.9% YoY in February missing 1% forecast and a significant distance from the ECB’s 2% target. Core inflation also drifted lower to 1.1%, down from 1.4% in January.

Analyst Fiona Cincotta looks at EUR/USD price action and levels to watch here.

GBP/USD trades -0.10% at 1.3910

EUR/USD trades -0.2% at 1.2025

Oil resumes uptrend

After dropping almost 3% in the previous session Oil prices continue to fall lower, although have picked up off daily lows. Both Brent and WTI crude oil rebounded off session lows after data revealed that output from both OPEC & Russia declined in February.

The update comes ahead of the OPEC+ meeting on Thursday where the group is expected to ease output cuts potentially by as much as 1.5 million barrels per day. The group had cut output by 7 million bdp which is around 7% of global output.

Attention first turn to API inventory data later.

US crude trades -0.05% at $60.20

Brent trades -0.02% at $63.70

Learn more about trading oil here.

The complete guide to trading oil markets

Looking ahead

18:00 Fed Brainard speech

21:30 API weekly crude oil stocks

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.cityindex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.

ALL TRADING INVOLVES RISKS. LOSSES CAN EXCEED DEPOSITS.

City Index is a trading name of StoneX Financial Pte. Ltd. (“SFP”) for the offering of dealing services in Contracts for Differences (“CFD”). SFP holds a Capital Markets Services Licence issued by the Monetary Authority of Singapore for Dealing in Exchange-Traded Derivatives Contracts, Over-the-Counter Derivatives Contracts, and Spot Foreign Exchange Contracts for the Purposes of Leveraged Foreign Exchange Trading. SFP is also both Derivatives Trading and Clearing member of the Singapore Exchange (“SGX”). SFP is a wholly-owned subsidiary of StoneX Group Inc.

The information provided herein is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to invest, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk.

The information does not represent an offer of, or solicitation for, a transaction in any investment product. Any views and opinions expressed may be changed without an update. To understand the risks and costs involved, please visit the section captioned “Important Information” and the “Risk Disclosure Statement”.

The information herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

StoneX Financial Pte. Ltd. 1 Raffles Place, #18-61, One Raffles Place Tower 2, Singapore 048616. Tel: 6309 1000. Co. Reg. No.: 201130598R.

This advertisement has not been reviewed by the Monetary Authority of Singapore.