 Okay, very good morning. Hope you are doing well. It's Wednesday the 13th of October and I'm gonna talk if you a few different things We're looking at Apple's aftermarket Decline in share price that we saw last night and I'll explain why that's happened as it's reported the company might well Slash its iPhone 13 production and targets. We're also gonna talk about Chinese trade data a couple of Fed Comments as well to be aware of one of which Bostick said that transitory is a dirty word and in fact when he was giving his speech last night He was dropping dollar bill every time into a naughty jar. He said the word transitory And we also talk about the formalities around the US debt ceiling and then of course the day ahead and actually just before I get stuck into Apple looking at the general Set up of the charts at the moment this morning. So just to remind anyone who's who's new to joining us I've got euro dollar top left cable top center gold futures top right and I've got this center left to right DAX future now that's that 100 s&p futures and I've got WTI crude down here on the bottom with bottom right the US Ten year and so overall pretty flat this morning in fact There's not too much movement scene their dollar index is is pretty much unchanged and therefore just marginal gains seen in The major pairs to get the European session underway As far as the equity markets are concerned pretty similar set up for the nasdaq as it is in the s&p where Yesterday's lower bound levels that were seen around this time On Tuesday morning session are still holding for the time being so certainly key areas to watch as support Now really on three more meaningful tests that we've had in the last 24 hours around 43 21 and a half in the s&p and as I said the nasdaq is is pretty similar here In its formation for the time being on a daily chart On the downside, we're still a little bit away from what would be seen as more longer term crucial levels of support With generally that rising Channel that we have with the horizontal area of support coming in around 14 471 As you can see here, we're trading well above that at the moment by around 200 points or so Markets at the moment as you can see here Just moving up the nasdaq future to its pivot level under no real new fresh catalyst this morning But perhaps people just looking to just enter again Lower down on those technical areas of support. Otherwise gold not too interesting right now But positive around five bucks Oils pretty much just locked in a bit of a sideways Period of consolidation for the time being after some of the recent surgeon price that we've had so it's pretty flat overall But holding an $80 handle and t-notes just tracking sideways for the moment basically training unchanged So let's jump straight into it and talk about Apple first and why Did their share price decline around 1.3% aftermarket while the headline is here The company is likely to slash its projected iPhone 13 production targets for this year by as many as 10 million Units and the rationale behind this is because of a prolonged chip shortage Hitting then its flagship product again. I'm a stress This is according to people familiar and have knowledge of the matter rather than an explicit comment from the company itself, but You can pretty much take it that it is the way that these new cycles tend to work And so Apple shares. Yeah, they did fall aftermarket and certainly something will be keeping an eye on I guess for a bit of context Here's a look at you know, given the impact that these global Chip chip supply shortages having on a number of manufacturing processes that this is looking at the gap between Ordering a chip and a delivery of it hitting Are now a record of 21.7 weeks as you can see here in pre pandemic times The average kind of time from order to delivery would have been in terms of weeks Roughly about half of what it is at the moment currently So definitely puts that into a bit of perspective But in this article it was on Bloomberg if you want to have a more of a read I did retweet it from the amplify me Twitter account It does go on to talk about the fact that it's still likely that Apple's gonna have an absolutely Phenomenal quarter going into that Christmas season when we get to Q4 Given the fact that the refresh rate for the iPhone 13 is like to be quite strong And I think we're looking at Predictive revenues for that quarter alone when that time comes around 120 billion in a quarter, which is just phenomenal In that respect. So some snags now I don't think ultimately this is a real deal breaker And some people talking about look at weight in the nasdaq future overnight But can't really say I see it that evident on my charts to be to be quite honest and the market at the moment It's moving higher for the time being otherwise the other thing from overnight in the Asia pack session is Evergrande assigned they're still generating a few headlines But I think important is that yes, they are missing some of these bond payments still And it is still a bit up in the air about what is the next step for them as a company But I would say overall broader markets in the assets that I've just shown you on my charts I think generally have just kind of accepted the reality of whatever grand is at the moment And I think that that kind of period of heightened sensitivity to that whole contagion effect has Definitely diminished a great deal And so as much as their headlines and I continue to monitor them remain vigilant They don't really see that really shaping much of the intraday short-term sentiment or strategy for the time being On the flip side though from an economic point of view. We did have overnight China's export growth accelerated in September and it has defied quite a lot of expectations of a slowdown Amid a nationwide power crunch that has forced factories to cut Productions so by numbers the Chinese trade balance came in at sixty six point seven six billion This would be US dollars in September That was above the expected forty six point eight billion their export number year-on-year for September was at twenty eight point one percent above the expected twenty one percent and up on the previous twenty five point six couple of things though and This was a comment from spokesman of the customs department in China Who said that fourth quarter trade growth may slow because of higher base of comparison from a year ago plus logistical problems In addition global appetite for Chinese goods and let's say could also start to kind of wane After buyers front-loaded their Christmas orders because everyone's kind of the chicken or the egg at the moment people are aware that there's going to be Production distribution issues most likely going into the Christmas period Given the kind of bottlenecks that we've been experiencing and that is that going to change consumer behavior and therefore Companies forward Front-loading very early their Christmas orders, which means then we get quite a dramatic drop-off as we go into the latter part of this year Perhaps so yeah, I mean how important is this Chinese data? I mean It's interesting, but if it is good, I don't think it's necessarily a positive trigger to initiate any type of long-lasting sentiment I think it is what it is on the surface level But as I said it's probably unlikely to remain at such Good pace as what we've seen with the last two trade data numbers coming out of China Which have actually exceeded expectations. I probably don't see that lasting for too long And I think the markets are aware of that for the factors. I've just mentioned the other thing then is yeah transitory It's a dirty dirty word. I can honestly say I can think of worse dirty words, but Yeah, the three speakers that we've had Bostick who is a voting member of the Atlanta Fed Voting member in the FOMC said inflation surge is lasting longer than expected So it is not appropriate to refer to such a rise as transitory. I don't think that's surprising I think that's just generally how the markets Become to view that situation and hence the reason why yields have seen some of the biggest moves in recent recent months In the last couple of weeks Bostick favoring tapering bonds sees lift off in more than a year So very explicit again to kind of define the timelines that tapering is not rate hikes the two are kind of two different processes The other speakers that we have had Is well, here's a look at the not so transitory inflation figures and certainly obviously we're looking at this today Because we get US CPI which I'll touch upon in a moment coming out this afternoon Which is obviously a critical component for for how sticky or not this inflationary pressure is at the moment The other speakers that we've had was the vice chair Richard Carida who noted that conditions required to begin tapering the Fed's Bomb buying program have all But been met and so again given the green light as markets are very much expecting for that November announcement of tapering and then the last one is bully bullard Who sits right at the most? Kind of hawkish end of the spectrum said in here bomb purchases should be tapered quickly In case rate hikes are needed Started talking about Advocating trying to get finished with tapering processed by the end of the first quarter of next year and to give that context as What will be heard at the previous FMC meeting they were talking more around the summer of next year So hence the reason why he sits much more on that aggressive hawkish end of the spectrum Not unusual to hear that comment from bullard So again of the three nothing really there too shocking I would say and hence the reason why there's been no reaction Despite the kind of hawkish sound and comments in the US dollar, which if anything is retesting actually as they speak Some of the recent lows that the Dixie has been trading So actually keeping an eye on the Dixie as I'm speaking now. It's just retesting the APAC low At the moment down about two tenths of one percent this morning in the Dixie And then a few other things to be aware of today, you've got corporate earnings We kick off the big banks today JP Morgan's coming out just ahead of 12 o'clock London time You've got the likes of black rock as well pre-market and then that kicks us off with then Wells Fargo City MS on Thursday and Goldman's coming out on Friday quick look at JP. What can we expect? so Focus on JP M's net interest margin so key metric of course for the banking Industry reflecting the difference between the interest banks earn on their assets and the interest they pay out to depositors and other creditors quick refresh though in Q2 of 2021 results that that came out in mid-July for for JP Morgan their bank bolstered their profits by freeing up another 3 billion in pandemic loan loss reserves that it originally set aside for pandemic related defaults So again, it's kind of how do you kind of pump the numbers and make them look fantastic? Well, yeah, if you're freeing up reserves to the tune of 3 billion that certainly helps and so that will start to obviously fade as those Loan loss reserves have already been kind of shifted in that sense In recent months, JP Morgan's rebound has faced a couple of challenges And I guess some of these are quite true of other bank stocks as well That we'll be looking out for later in this week that the Delta variant of COVID-19 Particularly over the summer has slowed the rebound somewhat of the economy JP Morgan's costs have also risen Boosted by pay to attract junior employees. You remember course there was that kind of infamous Goldman report that came out and Yeah, rather than seeing any structural change in the hours that they work a hundred hours, which of course is pretty insane Just throw some more money at these kids and and hopefully the problem goes away And so obviously your cost base going up in that respect as well Analysts expect tepid year-over-year growth for earnings per share to the EPS and revenue for the quarter And this would mark a significant slowdown in earnings growth compared to the previous three quarters So again, there's probably a reoccurring theme that we'll see through this earnings period Is that there's a bit of a realization about what the future now is going to look like and so a bit of a deceleration for some of the astronomical growth that we were seeing going through this Really strong Equity run that we've had through the post pandemic initial period now We're kind of to see the the top and slight fatigue of that And so a bit of a recalibration back to a degree a sense of normality From those much more bullish outlooks that we're seeing before is probably going to be the order of the day to some degree Final point from a student perspective because I know there's a number of students I've been talking to that are interviewing the likes of JP and and other us banks one thing I would say is that you know jump on the earnings The investor relation pages of these these banks after they come out and do take a look at those top level sheets to get a real Just glossary of like what the major divisions how they're performing. They're the different drivers of different divisions Just just generally get a flavor of how beyond just then the surface level that bank is performing So when you go into these interview situations, you're just that better equipped about knowing your target institution Anyone who needs help with that. Just drop me a comment. I can shoot you the The full actual press releases that come out not problem at all Otherwise just jumping to what's happening today We've already had some UK data to be quite honest pretty disinterested in that I mean GDP estimate for August month to month was point four against point five The three months on three months figure two point ninety is three percent In terms of sterling reactions not really so much sterling reaction, but I'd say dollar a little bit softer this morning Eur a dollar cable Kind of following a uniform approach cable just accentuating that move a little bit on the short term technical breach of the late APAC high That we've seen so just a short run up here towards its R1 up about 30 pips this morning But equally so you're a dollars up about 21 albeit that's being held for the time being by the APAC high So yeah, I'd say the UK data really not a big deal As far as really shaping any new thoughts about the UK economic recovery at this point Otherwise jumping further forward. You've got your as an industrial production at 10, but the real More interesting events are really happening this afternoon. You've got US CPI of course happening at 130 That's probably going to generate the most interests probably one of the main highlights of the week and certainly I think much more interesting perhaps than what we'll get out of the FMC minutes Which are coming out at 7 p.m. Later on this evening that it's going to be scanned for clues, of course any hints Towards the formalization of the announcement of tapering in November meeting But I think that's no surprise if that is the case So I don't think we're going to get too much more out of those minutes. So for CPI Analysts at the Dutch Bank IG write that the reopening spiking key areas that we've Seen the rate of price increases moderate But it's still faster than what we saw pre-pandemic with higher food housing costs particularly evident They suggest then that this will keep the year-on-year inflation rates elevated with the risk being that they Rise further in coming months given supply chain issues and infantry Shortages as we go into the key holiday season Hence the reason why as well you're getting the central bankers talking about well look We shouldn't really be using this word transitory so so clearly at the moment because perhaps that's not quite the case I guess more importantly, how's the market going to take that figure and react? Well, I don't think whether it's a little bit stronger a little bit weaker That's really going to change the game for the Fed in November. So any type of price volatility We see intraday is probably going to be relatively short-lived. I'd say in that respect Could it move I mean certainly sure I mean if we get a forecast beating number the headlines expected at five point three if it goes up to five point five and Let's say the core reading as well comes in at the top of the range four point three percent Yeah You probably expect the immediate reaction to be dollar yield strength gold under some pressure perhaps equities have little Bump on the downside and if we break that technical errors of support that we were looking at in the likes of the Nasdaq and the S&P you might get a little extended run on the downside. I don't think it would be dramatic though even under that scenario Because I think at this point it doesn't really change the bigger picture I think people are of that view that inflation is gonna hang about a little longer if it comes out a little higher on This side again with always with the CPI report in the US just having a look through the breakdown of the report What is causing these price pressures to determine or not whether how transitory they are? And so, yeah, I'll tweet that table and identify for you any of those things that stick out later on this afternoon And Yeah, that's pretty much it. So otherwise speakers. You've got ECB to cost speaking at 11 30 bank of England cunliffe Feds George this afternoon 230 and then the evening George at 9 30 Speaking alongside Brainard as well and then fixed income supply Italy Germany and then 24 billion dollars in the 30 and no auction as well coming out 6 p.m. From the US. So that is it gonna leave it there I hope that was useful any comments or questions at all. Feel free to just just drop those below Otherwise, I will see you guys tomorrow. Thanks very much