G4 central bank balance sheets | 11 2月 2022

G4 central bank balance sheets


#SP500:


Yields of benchmark 10-year U.S. Treasuries hit their highest levels since December 2019 on Friday after strong payrolls data showed that the U.S. economy added 467,000 jobs last month. Strong employment gains, accompanied by the biggest annual increase in wages since May 2020, pave the way for the U.S. central bank to raise interest rates in March by at least 25 basis points to tame high inflation. Investment banks expect as many as seven rate hikes this year. Stock markets were now facing "the largest quantitative tightening in history" from May onwards, with G4 central bank balance sheets set to shrink by $2.2 trillion over the next 12 months. This is a negative signal for the U.S. stock market.


Trading recommendation: Sell 4545 and take profit 4395.


G4 central bank balance sheets


#WTI:


Oil prices surged to seven-year highs, extending their rally into a seventh week on ongoing worries about supply disruptions fueled by frigid U.S. weather and ongoing political turmoil among major world producers. Winter storms bringing icy conditions in the United States, particularly in Texas, also fueled supply fears as extreme cold could cause production to shut temporarily, similar to what happened in the state a year ago. Crude prices, which have already rallied about 20% so far this year, are likely to surpass $95 per barrel due to strong global demand.


Trading recommendation: Buy 90.44 and take profit 91.88.


G4 central bank balance sheets


#Exxon:


Company grew earnings to $23 billion and drove nearly $2 billion of structural efficiencies in 2021 on top of the $3 billion the year before. Capex was $16.6 billion for the year, which was near the low end of guidance. As a result of cost reductions, improved efficiencies, and capital discipline lowered Brent breakeven price to $41 per barrel. Company continues to drive that down, expecting to average $35 per barrel between now and 2027. Cash flow from operating activities increased to $48 billion – the highest since 2012. Strong financial results will have a positive impact on increasing the capitalization of the company.


Trading recommendation: Buy 80.85 and take profit 82.10.

 

David Johnson
Analyst of «FreshForex» company
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