Skip to content Skip to footer

Markets Prepare for FOMC Meeting, Microsoft ($MSFT) Shares Drop, Here’s Why & German Business Sentiment Climbs

Contents

Gold prices higher ahead of FOMC meeting

Gold prices were trading higher on Tuesday, as markets began to prepare for tomorrow’s FOMC meeting.

Wednesday’s Federal Reserve policy meeting will be the first of the year, with some expecting a surprise rate hike from the Fed.

💡 Lower unemployment and higher inflation
After a devastating year for jobs (2020), it seemed as though things were looking up as job growth marked an important time in the economic recovery. But that was a short lived celebration. What was supposed to be a transitory period of inflation, will now likely last a while into 2022. Summed to the inflation we can also expect to deal with supply chain issues a bit longer

There’s plenty of jobs, just an eroded purchasing power and soul-crushing scarcity

After December’s meeting, it has been widely expected that a rate hike will come by the end of Q1, however as consumer prices continue to surge, some expect action to come sooner.

This comes just as the IMF cut its global growth forecast for 2022 to 4.4%, from 5.9% in 2021.

As of writing, XAUUSD rose to an intraday high of $1,852, its highest level since November.

Microsoft shares fall ahead of Q4 earnings

Shares in Microsoft were trading lower during today’s session, as traders began to anticipate the company’s earnings call.

Microsoft is set to hold its Q4 earnings call after today’s closing bell and comes after the company’s record acquisition of Activision.

According to analysts, the company is expected to report earnings of $2.31 per share, with revenue for the quarter coming in at $50.88 billion.

This would see earnings higher than they were at the end of 2020, where they came in at $2.03 per share on $43.08 billion in revenue.

$MSFT was trading 0.89% lower as of writing, with the NASDAQ down 1.72%.

Dax 30 rebounds, as German business sentiment climbs

Germany’s DAX 30 was trading higher on Tuesday, as markets reacted to the news that business confidence had risen.

The Ifo business confidence index rose to 95.7, beating expectations for a decline, with a reading of 94.7.

💡 A nice relief after a 6-month decline
Ifo said that manufacturing sector managers’ confidence increased significantly, with supply bottlenecks easing slightly. It said service sector managers also were more optimistic and that “the tourism industry is looking forward to a promising summer” — although, for the moment, hospitality “remains stuck in crisis.”

January saw inflationary pressures somewhat ease in Europe’s largest economy, which many believe to be the reason ECB President Christine Lagarde remains hesitant to hike rates.

Speaking after today’s data release, Ifo President Clemens Fuest said that “The German economy is starting the new year with a glimmer of hope”.

The DAX 30 closed 0.75% higher on the news. 

“The big money is not in the buying or the selling, but in the waiting.”

-Charlie Munger.

Eliman Dambell

Senior Market Analyst

Tradeview Ltd. is not a portfolio manager or an investment advisor. This Market Report is for informational purposes only. Any statements made or opinions voiced in this Market Report do not constitute investment advice. The Tradeview Ltd. Market Report does not constitute a solicitation to buy or sell in the financial markets. Although the information contained in the Market Report comes from trusted sources, Tradeview Ltd. is not responsible for guaranteeing the accuracy, timeliness, completeness, or fitness of such sources. Tradeview Ltd. shall not be responsible for and disclaims all liability for any losses which may be suffered from access and use of the contents of the Tradeview Ltd. Market Report. Trading any financial instrument on margin, using leverage or otherwise involves considerable risk. Therefore, before deciding to participate in any style of trading, you should carefully consider your investment objectives, level of experience and risk appetite. Most importantly, do not invest money you cannot afford to lose. Consulting with your investment counselor, attorney, accountant or other professional upon whom you rely for guidance as to the appropriateness of an investment in any style of trading is recommended.

Tradeview Ltd.

Is licensed to carry on securities investment business and is regulated by the Cayman Islands Monetary Authority (CIMA) as a full securities broker-dealer. Tradeview conducts business pursuant to the Cayman Islands Securities Investment Business Law (SIBL) and its activities fall under the direct supervision of the Investments and Securities Division of CIMA.
Headquarters: 4th Floor Harbour Place 103 South Church St, Georgetown, Grand Cayman, Cayman Islands KY1-1002, BWI.
Website: www.tradeviewforex.com

TVM Global Ltd.

Is licensed and regulated by the Labuan Financial Services Authority (FSA) as a Money Broker, registration number LL15870 licensed to facilitate transactions in foreign exchange pursuant to Labuan Financial Services and Securities Act 2010, the Labuan Companies Act 1990 and the Labuan Business Activity Tax Act 1990.
Headquarters: International Business Financial Centre at Office 5, Jamie Business Center I, Unit F10, First Floor, Paragon Labuan, Jalan Mustapha, 87000 Labuan F.T.
Website: www.tvmgloballtd.com

Tradeview Europe Ltd.

Is licensed as a Category 2 Investment Service Company and is regulated by the Malta Financial Services Authority (MFSA). The Malta Financial Services Authority (MFSA) is the single regulator for financial services in Malta. MFSA is a fully autonomous public institution and reports to Parliament on an annual basis. The MFSA is a member of the European Banking Authority (EBA), the European Securities and Markets Authority (ESMA) and the International Organization of Securities Commissions (IOSCO) and is a signatory of the Multilateral Memorandum of Understanding with other European regulatory Institutions. Tradeview is authorized to provide financial services across multiple asset classes and is passported in the EU/EEA under MiFID II (EU Markets in Financial Instruments Directive).
Headquarters: 157 Archbishops Street, Valletta VLT Malta 1440.
Website: www.tradeview.eu

Tradeview Financial Markets S.A.C.

Is authorized to conduct business pursuant to and in compliance with the General Law of Companies (LGS) promulgated by the government of Peru. Tradeview Financial Markets S.A.C is registered with the National Superintendence of Public Registries (SUNARP), company number 13089531. Tradeview Financial Markets S.A.C provides financial services in selected OTC derivative markets in compliance with all applicable government regulations.
Headquarters: Los Mirtos 239 Urb. San Eugenio, Lince, Lima, Perú.
Website: www.tradeviewlatam.com