A strong market recovery supported by Fed decisions

2021-12-19T11:04:35
asian stocks Oil US inventories US stock
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A strong market recovery supported by Fed decisions

A strong market recovery supported by Fed decisions: Yesterday’s Federal Reserve results had a significant impact on markets, with most markets rising, as traders grew more willing to take risks.

Evest follows market developments in the following report.

Topics:

US stock indices show strong growth after announcing the acceleration of ending monetary stimulus

Oil jumps with increased willingness to take risks thanks to fed decisions

US inventories decline

The Asian stocks without clear dynamics

A record rise for the American company Samsara after the first trading day

 

US stock indices show strong growth after announcing the acceleration of ending monetary stimulus

US stock indices yesterday showed the most significant growth over the past week based on the results of the Fed leadership meeting.

The US Central Bank kept the interest rate within a range of 0% to 0.25% per year, as expected. 

The Fed also announced that it would reduce asset buybacks by $30 billion.

As of January, monthly purchases of US Treasuries will be reduced by $20 billion to $40 billion, and mortgage bonds by $10 billion to $20 billion in November and December.

The volume of underground storage tanks’ buybacks decreased by $10 billion and mortgage bonds by $5 billion, accelerating the termination of the bond purchase program.

The statement that followed the meeting eliminated the statement that high inflation was a temporary phenomenon.

In addition, a point chart was released at the end of the meeting – a chart that reflects the individual projections of the Fed’s Board of Governors and Fed chiefs. 

With regard to interest rates, the point chart showed that 10 of 18 Fed leaders expect prices to rise three times more next year.

Average estimates assume that the rate will be 0.9% by the end of 2022, 1.6% by the end of 2023, 2.1% by the end of 2024, and 2.5% over the long term.

The local Fed said manufacturing in New York rose to 31.9 points in December, from 30.9 points the previous month,
which surprised analysts who expected the index to fall to 25 points, according to Trading Economics. 

In the meantime, the sub-index, which assesses the likelihood of improving the business environment in the next six months, has stabilized at 34.6 points.

Oil jumps with increased willingness to take risks thanks to fed decisions

Oil prices rose Thursday morning with an overall increase in “risk-taking” in global markets thanks to Fed decisions. 

The market was also supported by a larger-than-expected decline in US oil inventories,
showing that energy demand remains strong despite the emergence of a new Covid-19 strain called Omicron. 

The February futures price for Brent oil in London Futures Exchange in London was $74.71 per barrel, 1.12% higher than the closing price of the previous session. 

As a result of Wednesday’s trading, these futures rose by 0.2% to $73.88 per barrel.

West Texas Intermediate crude futures for January on the New York Mercantile Exchange reached $71.77 per barrel by this time,
1.27% higher than the final value of the previous session. 

By the end of Wednesday’s trading, the value of these futures had risen by 0.2% to $70.87 per barrel.

 

US inventories decline

The US commercial oil reserve fall by 4.58 million barrels to 4.58 million barrels to 428.29 million barrels last week,
according to a weekly report from the Department of Energy.

Experts surveyed by Bloomberg predicted an average fall of 1.7 million barrels. 

The gasoline inventory’s reserve fell by 719 thousand barrels of distillates – by 2.85 million barrels, to 123.76 million barrels.

Analysts expected gasoline inventory to increase by 2.05 million barrels of distillates – by 1 million barrels.

 

The Asian stocks without clear dynamics

Stock markets in the Asia-Pacific region changed without clear dynamics on Thursday.

Investors are assessing the results of the two-day meeting of the US Federal Reserve, which ended on Wednesday. 

Hong Kong’s Hang Seng index fell by 0.2%, while the Shanghai Composite Index rose by 0.45%. Japan’s Nikkei index rose by 2.1%.

The Kospi index in South Korea added 0.57%, while the Australian S & P/ASX 200 index lost 0.43%. 

Reserve Bank of Australia Governor, Philip Lowe, told reporters during a local forum that the central bank ,
would not raise interest rates until inflation stabilized in a 2-3% range,
which is unlikely to happen next year.

 

According to analysts: As of Thursday morning, the sentiment remains fairly positive in global markets.

Asian indices are mainly growing, restoring US trading closures, commodity prices are recovering, US index futures are slightly positive. 

A record rise for the American company Samsara after the first trading day

Stocks of American Internet of Things company Samsara rose 7.39% to $24.7 after trading for the first time on the New York Stock Exchange on Wednesday.

On December 14, during the IPO, the company placed 35 million stocks at $23 per stock — at the upper end of the announced price range of $20 to $23.

Trading started for the first time on the next day at $24.9.

Overall, after the results of the IPO, the company raised $805 million, with estimates of $11.5 billion, and after the auction, estimates rose to $12.3 billion.

Founded in 2015 by Sanjit Biswas and John Bicket, the company provides cloud technology and sensors used to control traffic or industrial processes.

The company has over 13000 customers, including Boston Management, Delta Construction, Gas and Construction and Windy City Limousine.

Boston uses Samsara technology to control the movement of electric vehicles and snow chairs in the city.

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