Yazar: Geoffrey Smith
Investing.com – Technology stocks will continue to sell after weakness in Asian and European markets. Stocks are generally weak after signals of inflation in China – but a number of Fed officials’ speeches could settle the nerves ahead of US CPI data tomorrow. Crypto assets also saw sales, as the cyber attack on the Colonial Pipeline showed the central place of cryptocurrencies in a global ransomware business approaching systemic rates. OPEC and the American Petroleum Institute (API) will share their reports on oil supply.
What you need to know in financial markets on Tuesday, May 11:
1.Technology sales will continue
When Wall Street opens, it seems that the sales seen in technology stocks will continue. It fell more than 1% before the market opened.
Other US indices were better, but still declined: dropping 0.4% and losing 0.7%.
Commodity price increases and fears of monetary tightening appear to be the catalysts for the move that started on Monday, but many other factors are at work, from increased regulatory risk to awareness of higher values and a return to value shares.
China’s technology shares traded reasonably high, but South Korea fell 1.2%, mainly chip makers. Taiwan Semiconductor Manufacturing fell 3.1% in Taiwan, while chip makers in Europe dropped 2.2% in the Stoxx Technology index.
2.China’s mixed inflation picture
New signs of inflation were seen in China’s latest PPI data. In April, PPI increased at the highest annual pace in three and a half years, rising from 4.4% in March to 6.8%.
However, despite signs that the global chip shortage is fueling higher prices for devices, the CPI rose less than expected to 0.9%.
China’s population data, on the other hand, showed that the country’s population was growing at the slowest pace in 100 years in the decade to 2020. The shrinkage of China’s working-age population and the growing number of retirees who will need to support can lead to upward pressure on wages in the long run.
3.Cryptos also joined the sale, Musk Trying to gather Doge fans
The ransomware attack on the Colonial Pipeline sparked fears that regulators would ban the use of such currencies, and crypto assets also fell into a selling frenzy.
The hackers group once again highlighted how DarkSide’s request for payment in currency, anonymity and untraceability offered by cryptocurrencies, facilitates global crimes.
Bitcoin fell 4.7% to $ 55,625, down 3.5% to $ 3,962. But after Elon Musk’s attempt to make propaganda on Twitter over whether Tesla (NASDAQ 🙂 would admit it or not to compensate for his damage by going on Saturday Night Live, DogeCoin jumped by 1.8%.
Tesla has more pressing issues to worry about: Cathie Wood’s ARK Innovation Fund, one of its biggest backers, dropped below its 200-day moving average on Monday. This could trigger more redemptions, which could lead him to sell Tesla stock.
4. JOLTS and Fed speakers
Four days after the alarmingly poor employment report, the Ministry of Labor will share the JOLTS job opportunities survey for March. The job deficit will rise to a record 7.50 million in 2019.
The figures will shed new light on the extent to which the April recruitment gap stems from the mismatch of skills and opportunities in the workforce as businesses regain their freedom to work. Economists argue that labor shortages can both slow the pace of recovery and put upward pressure on wages faster than would otherwise be the case.
We will listen to the speeches of Fed officials for the rest of the day. There will be opportunities to calm the markets on the rise in inflation, which is expected to be shared on Wednesday. First the President of the New York Fed, then Lael Brainard, Raphael Bostic, Mary Daly and Patrick Harker will speak.
5. Colonial thinks the pipeline will be largely back online by the end of the week
The Colonial Pipeline Company said it expects the flow from the oil pipeline to the East Coast to improve significantly by the end of the week, ensuring that the imbalance in the oil market is relatively limited due to last week’s cyberattack.
President Joe Biden said Russia could have “a bit of a share” in the attack, given the evidence that the DarkSide hacker group was present in Eastern Europe. However, no evidence has been presented linking them to the Russian government, limiting the possibility of retaliation that could harm Russian financial markets.
Thus, the oil market can return to a more normal course. The data calendar includes OPEC’s monthly report and the American Petroleum Institute’s weekly stock estimates.