February 2, 2024
Daily Forex Analysis: 2 Jan 2024
CURRENCIES:
Key Points:
- U.S. nonfarm payrolls report is the focal point for Friday.
- Weak jobs report expected to be positive for gold prices; strong data could negatively affect gold.
- The article analyzes the short-term technical outlook for gold.
- Federal Reserve maintains policy settings but abandons tightening bias.
- Rate cut possibility in March remains uncertain, depending on incoming data.
- January U.S. employment report of high significance with expectations of 180,000 added workers.
- Lackluster nonfarm payrolls could bring back March rate cut talks, benefiting gold.
- Strong NFP figures could reduce dovish sentiments on Fed’s policy, leading to potential pressure on gold in February.
STOCK MARKET:
- Market Recovery: Stocks experienced a rebound on Thursday, recovering from the previous day’s significant losses, in anticipation of major tech companies’ earnings reports.
- S&P 500, Dow Jones, and Nasdaq Performance: The S&P 500 increased by 1.2%, the Dow Jones Industrial Average by nearly 1%, and the Nasdaq Composite led the gains with a 1.3% rise.
- Federal Reserve’s Influence: The Federal Reserve’s potential rate changes were a central focus, with Fed Chair Jerome Powell indicating a less likely rate cut in the March meeting, against earlier investor expectations.
- Tech Giants’ Earnings Spotlight: Post-market earnings announcements from Apple, Amazon, and Meta (part of the “Magnificent Seven”) significantly influenced market sentiments.
- Meta’s Surge: Meta’s shares surged over 12% after it exceeded earnings expectations, announced a $50 billion share buyback, and declared a $0.50 cash dividend.
- Amazon’s Positive Outcome: Amazon’s stock also saw gains, rising more than 4% after reporting better-than-expected fourth-quarter earnings and providing an optimistic future outlook.
- Apple’s Mixed Results: Apple’s revenue beat expectations, but concerns about slowing sales growth in China affected its stock performance ahead of the earnings call.
- Contrast with Earlier Tech Earnings: This positive shift contrasted with disappointing earnings from Microsoft and Alphabet earlier in the week, which had negatively impacted their stock prices.
- Upcoming Economic Data: Investors are also looking forward to January’s job market data, with the nonfarm payrolls report due on Friday.
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