 Okay, very good morning. It is Wednesday the 7th of July. Hope everyone is doing well and gonna get you up to speed on the Close and Wall Street So I've happened overnight in Asia and generally an outlook for the day ahead but thought I would start with the heat map because quite an interesting day yesterday and I guess first of all starting with Actually a macro overview is probably more prudent than looking at the heat map first Because I do want to talk about Amazon briefly as you can see here really bright green and One of one of the largest companies on the planet rises nearly five percent Well, guess what the Nasdaq outperforms and mega tech certainly was a standout yesterday And we continue to see that somewhat unwind of that reopening trade where the Russell 2000 is underperforming and Influenced back into mega cap tech and a lot of the catalyst yesterday was certainly coming around the the release of the ISM services PMI figure that we had quite a large miss on Expectations well below the bottom end of analysts ranges We also saw the employment constituent move into contraction territory. So irrespective of the fact There's still a lot of the jobs market to make up People still finding it hard to fill those jobs seemingly at this point in time And so that in combination of what I felt was a lot of technical Trading yesterday as well, which was exacerbating a lot of the movement We saw the US 10-year yield break through the June support levels that saw Yields moved down to their lowest levels since February of this year And hence you can see this quite pronounced pop in the US 10 year in the bottom right-hand chart And we continue to remain up at those most elevated levels Holding on to those gains up to Flat to two ticks this morning the S&P 500 Talking to a couple of the guys yesterday about this because at the time it was selling off, you know, it was a fairly rapid sell-off and I was kind of having a conversation with a few of them about The reasons and rationale behind that and and certainly that it made a bit of sense in regards to Well, the data kind of not living up to a more positive Narrative leading to then people backing off this more hawkish idea of the Fed and therefore Some of the big technology firms liking that situation on that kind of general sector rotation play Leading to the NASDAQ outperforming against its counterparts where the S&P actually goes down about two tenths to down six tenths So it was a little bit of that and then it was also the degree of the the profit-taking I think, you know one thing for sure We've had such a stellar run in the US equity market And we were keeping around this rising trend line going back to the 21st They had been retested on the 30th of June and the 1st of July and We broke through that and the subsequent pivot and the prior sessions overnight low And then we just ran down quite quickly and at the time when I was talking to them when we were down here At the time through the S1 I was kind of semi joking to them saying well, you know I don't think it would be any surprise at all But by the time we go into the close of Wall Street that we would have rallied and recovered the entire loss and and lo and behold we pretty much did and You know, I just think sometimes when a market particularly Sells off like that. It's good to just come out of the crosshairs and the grass blades of the day-training environment And just put it on a higher time frame or a different perspective on your chart and think that We pretty much sold off to the point of where we were on the morning of before payrolls came out So it's not as if this was the the a great unwinding if you like and okay This is a meaningful shift in and therefore with the technical breaches and the market running heavy and with some momentum short-term Speculators entering the market, you know, you do get tend to get these big recoveries because ultimately for me I don't really see too much of a Big change here for the equity space certainly if it is down to Lower yields being depressed and the idea then the Fed a kind of kind of Unwinding bets of tighter policy reacting if you like as a catalyst to the service set to data In a similar fashion to what we had kind of the payrolls on Friday Well, then don't really see why equity should remain lower Definitely can understand one as that might outperform But it should be supportive more broadly all-round and and here we are. We're back up We recovered you know more than 50% of that initial sell-off This morning was sitting pretty flat in the futures But of course still very close to the all-time high at the moment The one thing that didn't really play true to some of those moves was the US dollar You would have anticipated in that type of situation Then the US dollar perhaps would have weakened and it didn't it's kind of held on to its gain So that was the one anomaly I guess from a correlation point of view the Dixie's trading pretty flat at 92 50 at the moment So the major currency pairs are kind of sideways For the time being as there's a little bit of caution in the air as we await things like jolts Later from the US and the FMC minutes of course coming out later on in the session Oil markets as well did move considerably lower yesterday, but again, I think context is very important And actually if you put this oil chart in a daily It's pretty much to the absolute scent that we tested that previous high that we had back in October of 2018 and then we've just come off and Yeah, sure. There's a few things going on. It's kind of a dispute Unresolved if you like from the meeting with OPEC UAE causing some headaches I think media are totally exaggerating about this idea of the potential Price war that could ensue on the breakup of OPEC I think that's just putting a little making a bit of a mountain out of a molehill to be honest I think more so for price I mean if you look even from where we were trading back in May, this is a 25 percent move here I think I guess if you go even further back to that previous low We had in March at the end of Q1 to the end of Q2 pretty much where we are at the moment We're up 34 percent on that rally and we've come off four and a half five percent And if you actually look at the incline from May, it's been pretty steady on its ascent So hitting that technical marker, I think and just given the news flow at the moment I don't see any real Destabilization to this higher price of oil for the time being personally looking at it from a slightly Higher time frame perspective. So yesterday certainly was heavy. It certainly did weigh on the energy stocks as well Financials also feeling a bit of a brunt of the moving yields because they tend to benefit a bit more In a higher margin higher yield environment But as I said, Amazon was a real standout. You can see that quite incredible really and Andy Jassy It was his first day in charge because the formal exit of Bezos Happened on on the fifth and so not a bad first day at work but predominantly propelled by the fact that The pentagon in the u.s scrapped trump's 10 billion cloud deal with Microsoft If you remember Trump had bit of a tit for tat with Bezos and amazon at the time because of associations with the washington post and critiques of the Trump administration And so that's been contested then that that was unfairly They were unfairly treated and amazon have kind of come out and then back and revived their bid Now that the pentagon has scrapped the deal with microsoft and that's been to Amazon's benefit and as you can imagine microsoft has flattened the day in comparative terms Asian markets overall, how did they perform? Pretty subdued similar picture to the global counterparts of the handover from overnight on the closing wall street Also layering in china at the moment going through quite an aggressive form of crackdowns Quite wide-reaching but predominantly in the tech space at the moment And that in combination with some of these other factors as discussed has kind of led to a fairly cautious tone in overnight trade Leading to the open this morning, which I would say is relatively flat overall I mean again from a cross asset class perspective Index futures are if anything, you know flat in the u.s. Still minor performance and as that the dax is up about 48 ticks this morning The dax yesterday again quite technical Which I think really did exacerbate some of the downside price action yesterday You can see here that trend line same setup as what we're looking at in the other u.s. Indices from the 21st Had a few retests on those pullbacks We saw a definitive break of that at a rundown then to that horizontal same level on the 23rd and the 30th before a bit of a bounce back And we're just breaking above in the future space late yesterday in the overnight apac high Looking to reclaim the pivot here in the dax again nothing really specific just a little bit of recovery from from yesterday But as I said currency markets both major currency pairs uo dollar cable top left are basically flat as to as the 10 year oils now in a pretty much a consolidation range after the sell-off from yesterday gold A touch higher um, I guess looking here Just got a trend line on from the 30th That got retested at mid the sell-off and move lower that we had yesterday And it's just holding up at the moment above perhaps a short-term key level of support with that trend line On a horizontal basis from that previous high we had back on the end of last week on some of the volatility Payrolls the retest that the commitment of trade this week And then from the overnight apac session All right. Well, let's talk about some of the other news in focus and going to start off with the UK lockdown strategy because there's been a few pieces of news about this as you've just seen cables flat So this isn't really impacting cable right here right now But I definitely think it's worth keeping an eye on the covid situation in the UK both from a case count point of view But also for the government's lockdown strategy, which we know has been pretty clear Outlined by p.m. Johnson. It's just the other day the health secretary Siji Javid came out yesterday and announced that from august 16th Anyone who is in close contact of a positive case will no longer have to self isolate If they have been fully vaccinated and the same will apply to under 18s who are not who are not currently vaccinated Um, Siji Javid did go on to say though This is where this number comes from this 100k And that by the time we get to the 19th Ie in 12 days time He would expect case numbers to be at least double what they are at the moment And so around approximately 50 000 cases per day And as they ease and go into the summer So when then probably it's going to get to the point of mid august when anyone Close contact of a positive case will no longer have to self isolate Siji Javid the health secretary himself said that they are going to be expecting a significant rise in case numbers That could be as much as 100 000 Now as we've discussed before The idea being here is that the impact ultimately on hospitalization rates and deaths is much lower because of the fact that now It's mainly young demographic Not the older and more vulnerable of underlying medical conditions who have already received Well at an advanced time their vaccines But a bit of context I think is quite important 64 percent of adults have had two vaccines to two doses of those vaccines Again on the side point. We obviously saw that israeli health ministry report come out yesterday talking about the efficacy of The Pfizer vaccine. I think it dropped to 64 percent from the previous 95 percent Specifically due to the delta variant, which is the one that's definitely circulating in the uk And and also in mainland europe. So there's a few kind of tail risks here to the strategy And then the chief medical officer chris witty of who of course, I think you'll recognize by now Um, he did come out yesterday and talked about the fact that while he expected deaths to be much lower Proportionately compared to previous waves Long covet remains a worry in young people and long covet being those long-term symptoms like fatigue shortness of breath chest pain cognitive disturbances So, you know, it's not as if Although they might not lead to icu admission Or worst-case scenario death there are other Kind of side effects as well that people can have on that basis and certainly with the height of what the numbers are This is one of those points that's being contested at the moment in the political forums of whether this is the correct strategy to deploy or not, but Again medical scientist point of view is one thing the government I don't think boris johnson really has a great deal of wiggle room now to back down from his current approach of this Unlocking strategy and given the roblova that's already been witnessed from before Um, so right now the cable price is not really that impacted and I don't think um, it would be however It's definitely worth keeping in mind then over the course of the next kind of eight weeks that case rate Definitely given the unlocking as well is likely to accelerate significantly So it's definitely a few things to keep an eye on there then How does it translate in terms of hospitalizations? And then this idea does more data come out in regards to supportive of the Efficacy rate decreasing and by how much for other drug manufacturers are like what we've seen for fizer in israel For the vaccine and then also this idea about implications of long covet as well Could be something which would be a more long-term impact potentially Um Elsewhere in spain Um, that's drawn a bit of attention the delta variant and the surgeon infections among young people specifically Unvaccinated in spain Has led to the country now being the highest of all countries in mainland europe Um, as you can see here spain just overtaking portugal Um The response then has meant that the catalonian region which has been the worst hit across all of spain Have said yesterday they're reintroducing restrictions on nightlife Uh, while castille leon called for a return to a curfew system as well, so the lockdown Um measures are being re-implemented in some areas in europe just at the point of where the uk is is unlocking And then elsewhere similar to spain sydney The leader of australia's new south while state came out overnight and has ordered a week long extension of sydney's COVID-19 lockdowns due To specifically the delta variant again and also given the fact as well their vaccine rollout program is running behind schedule So a few things to be aware of there Iran we haven't mentioned in a while And that's because there's not a lot really that's been going on if you remember they were Going through several round of talks. We still haven't got yet a fixed date for the seventh round of diplomatic talks about whether They can broker an agreement to return back to that 2015 nuclear accord And the latest has been from a unatomic watchdog yesterday that iran has begun the process of Enriched uranium metal In fact the move could help it develop a nuclear weapon And three european powers have said has threatened them talks to revive these conversations that are ongoing at the moment So from an oil perspective, I guess For the geopolitical Impact of this and and and practically from the physical return of supply of crude from iran It just looks ever less likely a prospect And you know if you go back to some of the briefings i was delivering Three or four months ago when people went oil at the time was kind of moving lower on the fear of return of iranian crude to market You know I was pretty clear at the time that Brokering a deal with iran Just given how that relationship Was broken by the trump administration a few years back Was never going to be easy And and hence, you know, we are seeing what you have at this present point in time so there's still that kind of lingering idea of perhaps the new Present elect he wants to get something in before he gets formally inaugurated in a few weeks time And could we see some movement? So it gives him the ability then if they signed back up to this accord to pass on any concessions given to the west Onto the outgoing president rihani. So perhaps this is just a bit of leverage play To negotiate with a stronger hand. I guess the next couple of weeks will Will really be most telling but at the moment things are remaining pretty status quo that they're not talking at this point in time All right in terms of candor for today, it's very quiet in fact for the european uk morning It's not a great deal going on. So really it's a us centric session You've got jolt job openings coming out at 3 p.m. London time likely to show a new record for job openings But the hiring continues to lag far behind given potential workers are either unable or unwilling to get a job And then the main kind of focal point will be on the fomc minutes And of course, this was from that surprising Fed event at the time which did initiate quite a Certificate move across assets globally on the back of that surprise two dot plot rate hike For 2023 of which no one really was anticipating at the time And the fact they made the admission that inflation perhaps is a little bit more Larger and around longer than they previously anticipated that really triggered that more hawkish development The world I think has moved on a little bit since then and I think yesterday really was evident of that So i'm not really too sure how impactful the fomc minutes will be because they're probably going to sound pretty hawkish But I think that in itself is perhaps now a little dated in view Given the fact of what's happened with yields equities are back up with the highs So it could be one of those where you get an initial little Um kind of bump in prices Intraday in the fact that it's kind of wow these are kind of quite hawkish commentary or tone to their discussions But then the realization is is that um Other things have come out the ism has come out the pmi number yesterday the payrolls figure Some of the some of the jobs components are quite in focus The market is reflecting now that that tightening fear has been reversed Because you've only got to look at equities and t-notes to be able to really see a lot of that So it's coming out seven and then separate to that feds bostic speaks after on the economy who is a voter 830 and then the oil infantry numbers after that at 9 30 remember come out today A day later than normal given the u.s. Holiday on Monday. All right, that is it Good to let you guys get on with the session wish you a good day ahead And I will catch you later on in the amplify live community. All right. Take care