 Okay, very good morning to you. Hope you had a fantastic Easter break and enjoyed the the warm weather or be it I'm still in the lockdown obviously for most parts of the world But hopefully you had managed to make the most of it As you can see here a lot of you might be watching this video in the end on YouTube So don't forget to like and subscribe to the video and the channel very much appreciate it If we can grow our community and obviously every day I encourage people to any questions that they have any market opinions that you have just leave a comment I'll be replying throughout the day as I always do as will the rest of the team So happy to engage with you guys and answer your questions as much as possible One of the things here as well that I've received quite a lot of messages There was a video that went out in the US about a week ago of which I appeared on a panel discussion With someone you might recognize as a name Mike Bella Fiori But he and I would be giving a chat just generally about just what traders look at and how do we monitor news? That was kind of my my part of the discussion And so a lot of people have been asking me about how to use Twitter for trading and so on So if you go on our YouTube channel this video here You can see down at the bottom how to use Twitter picture myself there if you click on that video That's basically your your one-stop shop for everything you need to know So yeah, do do check that out when you get time if you've not seen it before But otherwise, let's just have a quick look at what's going on this morning and overall a little bit of risk appetite Obviously America were back in the market yesterday We're going to have a look through some of the charts to just see The lay of the land going into today's session because of course you've probably read the US earning season kicks off today Which is going to be a bit of a focal point, of course Just given the context of the overall economic environment to ascertain how severely yet Corporate profitability has been impacted by the shutdown and COVID-19 But OPEC deal obviously that was the where we left things at the end of last week We'll have a catch up on that but overall this morning equity index futures up generally positive Now up about 300 the S&P 33 points and the DAX about 165 So fixed income a touch lower albeit just bumping up a little bit in the last half an hour still down two and a half ticks in the tenure and then gold Still elevated up eight dollars albeit off the natural resistance of our one that we had following the grind up in yesterday's session We'll have a look at gold as one a bit more detail the currency markets the Dixie's pretty flat albeit It's just come up a little bit In more recent trade to test an era of support in the Dixie from yesterday evening London times so both major pairs just coming off a touch But still up on the day at the moment you're a dog four and a half cable up 16 for the time being WCI crew down at the bottom here Pretty much sideways action as I said we'll review that in a moment But obviously still digesting whether or not the markets going to be satisfied with this OPEC plus deal and G 20 that they managed to kind of club together a few days ago So what have we got to look out for and generally why is there positive risk on sentiment at the moment? Well, there was some data overnight Data showing Chinese exports in Yuan terms fell less than expected has helped kind of lift sentiment a little bit At least in the short term. I would say that's generally quite a short-term reaction though I don't think it's going to be particularly long-lasting But Asia up a little bit overnight the export number for China was minus 6.6 percent sounds pretty bad But expectations were for minus 14 percent And then overall continued easing in the rate of new infections in many countries in regards to coronavirus Which is something we can review as well But overall in terms of the week ahead, this is what we're looking at for transition my screen Earning season as I said, I'm going to talk about that in a little bit more detail in a second But the big banks are always the first to report so today no different We get JP Morgan whilst Fargo and also Johnson and Johnson going to kick things off There's about 40 S&P 500 companies this week including four of the Dow 30 components Later on in the week we get City Bank of America Black Rock Goldman So all of these kind of top tiered US banks as we go through the week Wednesday could be quite interesting US retail sales obviously poised to fall in March by the most ever seen just given the immediacy of the The lockdown and that's going to have a severe impact on the retail sector of course not just in America But in terms of globally, but obviously this is going to be quite a key reading kind of like what we've been looking with jobless claims We know it's going to be bad We know it's going to be extremely elevated record high levels of initial jobless It's just how far is that you know, how bad is it? And I guess we'll be looking at retail sales in a similar fashion and then on Friday We've got China releasing its GDP numbers and that comes alongside then the slew of data They always release at the same time as GDP IP retail sales and their jobless figure as well all coming on Friday But let's just have a quick review then on the corona virus cases and this is what I was going to look at first Which if I just make this chart this big so you can see it now This is looking at daily confirmed cases a seven-day rolling average By a number of days since 30 daily cases being first recorded just to refresh your memory The stars indicate each country's line when the lockdowns were put into place and as you can see here a couple of you know kind of Lukewarm signs that perhaps we're getting to a point where The worst might be over. I know I don't want to jinx things too much But you can see from the trajectory of these lines So even though deaths in certain areas are still incredibly high particularly in America and the UK Overall in mainland Europe Italy reported lower number of new coronavirus cases on Monday Even as their daily fatalities did rise Britain Should expect the number of daily deaths from coronavirus to continue to rise this week Unfortunately followed by a plateau For a period of two to three weeks according to the chief scientific advisor to the government That has led them to reports as you can see here that one the UK's like to announce the lockdown extension this week according to the Times newspaper Unfortunately, if you are based in the UK is looking likely that we're going to remain in lockdown Until the 7th of May is what they're saying So this fits in step with what we're kind of looking at with these curves is that the UK? You can see here still yet to get to that plateau point and when it does it doesn't decrease immediately We're looking at around a two-week period two to three week before it then starts to drop off And that's when they can look to start loosening some of these measures as what we've seen with Spain Spain became the first of the one of the hardest hit European countries to loosen its regulations Allowing workers in non-essential industries such as construction. They've returned to work now and obviously Much like we were talking about China a few weeks ago. I think this is quite critical now about just monitoring. How does that type of? Loosening of these these more stringent rules about the you know potential for a secondary wave of transmission of you know Human to human contact. How does that pan out in terms of these numbers as this is the kind of new difficulty of which the markets are going to face as a challenge now Few other things then in terms of these dates what we're looking at. So as I said UK is going to be extended likely What's the date that's being put around as the 7th of May? Italy's new coronavirus cases forwards daily death toll rises. They said Italy We already know that theirs has been extended to the 3rd of May The French president Macron came out at the weekend said they're going to extend to the 11th of May India to the 3rd of May has been another month that's come out earlier this morning And then in the US now the US of course has now jumped to the top of par in terms of The severity of the situation of COVID-19, but Trump has made some comments over the weekend Excuse me yesterday on Monday And said that the administration was close to completing a plan to reopen the US economy Including nine states on the US East Coast and West Coast which are Predominantly the hardest hit when it comes to the virus in North America. So I'm not too sure how to interpret this to be honest because The the situation is still fairly severe and I would say that they've still got another period of Probably quite high levels until we start to see a decrease in the lights of say Italy and France who generally are a slightly head of the curve So I can understand why Trump would say this type of thing is obviously a little bit of management Given the negative Situation that we're seeing in the empirical evidence of the US economy whether through You know layoffs jobless claims being at these multi You know kind of weekly record highs the retail sales this week's going to be a disaster GDP is coming up in Q2 is going to be You know Massively down and so I guess he's trying to sound positive in the sense that the sooner we can get things open the sooner He can kind of jolt the economy back to life again, but obviously it comes at a real Health risk so as much as he's saying this how much is this deliverable well again I think he's being a little bit optimistic here Remember when we were delivering the briefing a few weeks ago He said that the US economy would be opened by Easter. Well, Easter's come and Easter's gone and they're still in lockdown So what pillar to politicians say and actually what becomes reality? I think a little bit disconnected to be to be quite frank So one one to monitor, but I don't think this is this is a big deal at this point This was you know looking at projected timelines and milestones for a turn to work in the US If you did want to look at this in more detail, I did tweet it My hand all of course is here. So just feel free to follow me on Twitter I'm fairly active these days now that I'm at home rather than they're in the office So, yeah, it's a bit small to look at I'll let you digest that in your own time But essentially it was looking at what I thought from Morgan Stanley quite a nice analysis of the general bottom access Which is kind of here. We're right in the middle of this blue peak And the way they've kind of this is a cumulative value of the daily new cases in the east and west coast Coupled with the rest of the US with case numbers over 1,000 Then it's looking at the general trend lower as we go through the coming months until schools reopen Which is timetabled for a kind of September time and then the potential second wave of infections But the potential vaccine for health workers When does that come and then when does the potential vaccine broadly become available for the general public which MS In their research are suggesting is not going to be until basically 12 months time Essentially, so yeah, have a look at that when you get a moment One of the other things though what people have been looking at is obviously the US equity market This was a comment a research note out of Goldman Sachs yesterday and Goldman's have made a bit of an about turn on their previous call They were previously quite bearish saying that the market was going to see another pullback of an aggressive nature Down to the kind of 2000 level. However, they've now dropped that call and they've actually switched it And now now saying US stocks are likely bottomed on Policy support despite the likely steady stream of weak earnings reports Q1 earning season will not represent a major negative catalyst for equity market performance their year-end S&P 500 target remains 3000 is what they're saying and on that note then let's just get the S&P 500 up and let's have a look at what we're what we've got So let me just quickly switch my screens So this is the S&P 500 I've just made a couple of markups here from where we were on the reopening of trade We did kind of gap up but then came on immediately under pressure Kind of tracking the oil move if you were looking at markets on Sunday night and electronic trade We did rally up into the open on Wall Street, but a little bit of nervousness perhaps going into the earnings season But we've already taken back That move for the moment, but on a slightly longer picture Let's look at that Goldman Sachs call of what they're looking at for the year-end target of 3000 So 3000 puts us up basically around this kind of level here pretty much where You've got that death cross just on my chart here at the moment in terms of these technical indicators So, you know, not the most outrageous call and I guess that's the year-end call So there's probably going to be some ebb and flow of movement until we get to that point Not forgetting as well that we have got it. You know, it's almost hard to remember. We've got a US election in November at the end of the year early a few months time and Obviously Trump's going to be doing his utmost to get the US stock market back up there the economy back reopened in time for that event Because as we've seen before he's kind of weaponized the stock marketers Wanted to validate the kind of effectiveness of his policies So definitely he'll be doing anything everything he can at that point But from Goldman's that their general idea here is that just given the fiscal and also The kind of unprecedented nature of doing whatever it takes from a monetary policy perspective That has now eliminated the risk of any severe Downside and hence their their call at the moment technically speaking where we are at the moment You can see around this 50% fit from the old-time highs in a March 23rd low is causing a little bit of Resistance for the moment. We've really failed to substantially get above that level and that was that summer of 2019 Low also the 2800 handle is around these levels So that's kind of the obstacle at the moment to the upside whether or not we can break above there It's going to be quite key and if we did the next move up would be up to around that 2855 type level You can see from the Feb and March areas of significance and also from back on the 4th of October You can see here of 2019 So that's the kind of S&P story and what the chart looks like technically It's going to switch over and have a quick look at another chart, which is just above it Which is this one, which is gold and I was going to change gold to this one, which is a monthly chart Now someone was asking me this on one of the YouTube comments Last week about you know where could gold go from here and one of the things I responded with was just keeping an eye Technically on these much longer time frames. He's looking at monthly candlesticks And you can see just the incredible move that we've had over the course of April Even as stock markets have stabilised one thing to be aware of is this which is Holdings in the SPDR gold shares have surged to the highest since 2013 Now the SPDR gold shares the largest such fund Surging above 1000 as you can see here so getting above that high that we had in 2016 back to levels not seen For several years so people still want exposure to gold at this point despite the general positives that I've been discussing with the The kind of flatlining if you like of the the trajectory of some of the new virus cases People are still kind of positioning themselves against the economic reality that's still yet to really hit home in full force And so with gold what I was looking at was that 1722 which was up here that deck 12 Kind of high now that we've got above there. You can see we've pushed a decent 25 dollars already above that level I wouldn't really expect much in a way of resistance now until we get Up to around really the 1800 dollar handle You can see here where we are at the moment at 55 that does come inside with the November Kind of high on the monthly candlestick, but anything above that then 1800 is the next psychological target And you can see what an important level that is If I just switch back to my charts here You can see the November 11th, Feb, October 12th highs all reside at around that level kind of 1795 1800 on the figure To be to be watched. So yeah gonna be it's gonna be interesting It's kind of a counter-intuitive move in a way because you would think there's equities continue to move higher Things start to stabilize generally in volatility that you'd think gold will come back down under pressure but I think it's more of a Positioning play now for what is to come over the coming quarters When it comes to gold in that respect from a from a fund manager's point of sense or point of view I should say The other thing then to look at of course is oil. This is just a summary from a tweet I did a few days ago when the initial news was coming out OPEC plus they eventually managed to get a deal together. It was looking very last minute I'm not sure if you were tracking the news over the weekend But the markets were going to reopen really a few hours to go They still hadn't got a deal done and then they called a final emergency meeting where they managed to get this thing over the line so OPEC plus they're going to cut 9.7 million brows per day for May June and Mexico to cut just a hundred thousand that's less than it's pro-rated share and how this is going to work is that Americans Trump was going to backstop the 300,000 shortfall to hit the 400k that Saudis wanted in order to get the deal Over the line, which was of course quite interesting Just given the fact, you know the the current relationship We've had ever since Trump came into the White House of Mexico and here he is then Backstopping some of their agreement talking about he would he would cover them basically For Mexico then to reconsider in two months time how this will work The 9.7 million will be in effect for May June and then generally it scales down a little bit as we go further forward in time But this deal could well be in place for the next two years is what they're saying Which is probably the the the right thing and shouldn't come as too much a surprise when you think about the the kind of Huge impact that the COVID-19 has had this gradual recovery that we're going to see in the economy It's not going to be an immediate Fix here in terms of what they're doing. It's a much more longer play than that There were talks of a 3.2 million brown per day cut from G20 states outside OPEC plus So this was a coin to sources at the time But this is the type of levels that we're looking at that's a little bit of a disappointment OPEC plus originally had asked these Other G20 states to contribute about five and they've only come through with a low Three million so I was quite bearish at the time when I was hearing this news and when we were And the one what first of all let's look at the chart when we were looking at this And I go back to well, let's go back to this chart here this was of course The end of last week and why just what a what a session it was there was just headlines coming and price movement We're seeing big swings of kind of six seven percent ten percent at some periods and then we got to the point of Sunday night and we actually opened up just short of twenty five dollars But we came under immediate selling pressure and we pretty much sold off a straight ten percent in the first Kind of half an hour of trade or so before then gradually coming back And we've just kind of eased all the way back down to those levels again So the overall I think perception of this deal And if we look at it maybe on this one, it makes a little bit more sense. So here we were And then we just remove my video feed so you can see what I'm looking at here One second see if that works There you go So here you can see a full annotation of what we're looking at in the crude market and this was when we reopened So if you look at it where we are Given the fact that where we were open on Sunday night with still at least two dollars down from where we were We kind of consolidated at the moment I think a lot of that is just waiting for us to come back in full market now Back in after the Easter break and it's going to be I think a little bit of a day where we'll start to see a bit of More definitive move you can see we've kind of squeezed in the price here more recently so a decision needs to be made at this point about where do we take this from here and You know where we were up trading at you know only a couple of days ago They were remember when there were source comments talking about cuts as large as 20 million You know Trump was talking about 15 million when he was tweeting the week before that was when we hit that high so those highs on that type of talk We're up at 28 29 dollars and here we are down at 22 and a half this morning It just goes to show you know the tracking of how this market is going to react is a largely dependent upon How the scene is set and that forms our expectations and that's why I felt quite bearish at the time when Trump was coming out with these quite spectacular figures Because it's kind of doomed to fail in a way and and that's kind of how the markets have taken this the reference Bar was so high that it was almost Always going to have a negative kind of price reaction in that sense, but from here You know if we do start to break lower obviously the levels I'd be keeping an arm was that initial opening Volatility low that we had on Sunday night at 22 dollars and you can see here. I've marked up with some ellipses Some price points from March and April 2170 would be a target and then that would open up the overall $20 handle again, which is obviously so significant being a close to two decade low That we briefly printed going back to the 30th of April But it's been a level that generally has held thus far and that's very close proximity Obviously only around two and a half dollars away from that at the moment And that does technically open up a firm break of there at any point in the future Quite a trap door technically where there's not a great deal of support until we get much lower down into the kind of 17 Had or 16 handle, which would be the post 9-11 2001 Low at that point One of the main things as well why people are quite disappointed with this OPEC deal is really the demand destruction that this coronavirus is having on the global economy, of course, you know as airplanes public transportation and manufacturing activity everything that requires and backstops the demand for this product It's obviously been significantly impacted by COVID-19 and if you look at everyone from research houses to funds to energy agencies in regards to the US energy department or the EIA then Did it change in all demand for April year to year is Significantly more than what OPEC have proposed and what they're cutting Now although OPEC overall production like what we're going to see in the States should drop off its record levels by a fairly substantial margin Given the fact that now there's lower Price, it's not cost-effective to run these facilities And so therefore naturally production levels will decrease that in step with the production cuts The question is is that enough to offset this this huge demand shock that we're having and that's what's keeping people generally quite bearish despite these actions another question I had over the weekend and I would say is that you know Don't don't be fooled that OPEC can't change this deal They can't get more aggressive. They can't go deeper longer harder Absolutely, they will if the price breaks 20 at any point In the days and weeks to come and the price starts to get a rundown further Or then everyone's gonna have to take action and that includes Probably the de facto kingpin now who's the dealmaker which is Donald Trump because the price does start dropping to those types of levels just mentioned then that's gonna have a massive implications then for the The energy sector in America and then consequently the domino effect being more mass layoffs That's going to be incredibly problematic for him to manage economically, but also politically So he won't want to let that happen So I'd say this is evolving situation, but it's going to be somewhat Determined on the price whatever the price does if it comes on the pressure, they're going to have to do more at this point Okay, few other things to have a look at then what do the banks think about the deal Not just about my view. These are a couple of headline things that I saw yesterday city Saying reductions would do little to stem the price route GS is a historical agreement yet insufficient And then UBS said the glut of crude will persist through this quarter as Producers have already committed this month shipments to their their customers. So the general Main Street view is that This is going to be quite a testing time at the moment to see how oil plays out and that on the balance a lot of question marks And whether what they've done is enough at this point Okay, shifting over to another thing to have a talk about earning season is back Here and as per the normal routine the the banks really kick things off So you're going to get JP and Wells Fargo ahead of the opening bell today As I said earlier got 40 S&P 500 companies for of the Dow 30 components reporting this week It starts to kind of ramp it up as we go through the next few weeks Earnings for S&P 500 firms are expected to tumble 10.2% in the first quarter compared with the January 1st forecast of a 6.3% rise So back at the beginning of the year we're anticipating that the end of this quarter, you know the The general earnings for S&P 500 companies would be a positive over 6% and now it's been Kind of repriced if you like by by Wall Street analysts to it's going to be a negative over 10% into double digits So quite a huge turnaround that we've seen over the last Couple of weeks in particular and that's before the anticipation is the earnings are going to plummet Nearly 25% in the second quarter And if you remember that's when the US economy in itself is expected according to Goldman's for example So it's going to be a negative Q2 print of around 35% So that's when we'll be right in the midst of the worst economic kind of situation the aftermath of this present lockdown that we're in Couple things might my colleague Eddie some of you might have seen him He's done a couple of videos on the on the channel before but he's done a really great LinkedIn post where he's kind of done His essential guide to what to look out for and namely we're looking at banks They generally are the sector that kicks off earnings and there's a few things he's mentioned here Which I'm just going to briefly recap But feel free to read this more and full on his LinkedIn post But he said larger provisions for credit losses That's one of the main things that he's looking out for in the the banks earnings numbers And then just generally in earnings in general if you think about energy specifically Particularly these more smaller independent oil firms in America. They've been particularly squeezed by this low price point And then retailers of course, you know, if you think about retail in the US Well, then generally speaking, you know people They're in lockdown They're not able to get to the high street. So they're going to fill the impact of brunt as well our airliners Expected then losses that occur when credit and debt becomes delinquent or is like to default or become unrecoverable So if you think about banks Credit card and consumer lending businesses and they're expected to take to take a great hit Just on the back of this lockdown and the layoffs that are happening at the moment The other the other things here maybe on a slightly more positive sign is just generally the FICC and equity trading So just generally the trading divisions of these big investment banks because of the high degree of Volatility is that kind of being good for business the expectation is yes But to what degree and then on the other side, you know, if you think about investment bank essentially split between The kind of global markets and the advisory capital market side Well on the investment kind of classic banking side Probably suppressed capital market activity this huge uncertainty about where the economy is heading in future is meant that you know If you think about transactions M&A deals, they basically just stopped as you wouldn't as you would imagine It's the most prudent thing to do is not be cutting new deals when you don't know what the economic future holds No, they're a few weeks months away. Never mind years away. So that's going to be a massive hit to their advisory fee kind of income But on the flip side if you think about things like restructuring divisions I was talking to a contact at mine who works at hula hand low key, which is one of the big kind of US boutique Advisors in the States and they were saying that their restructuring business is just unprecedented at the moment And they're having actually having to hire in new analysts to help with that demand and that's likely to To be quite a standout that we'll see with these banking firms then ECM equity capital markets firms frantically issuing secondary secondary or follow-on offerings to raise equity and liquidity and as we've seen with this morning Exxon They've raised 9.5 billion to load up on new cash while debt markets are still open to new deals at the moment And so looking to safeguard themselves through kind of hardship That's to come over the coming months But obviously this comes with investment bank advisory services in order to execute that kind of debt offering And so they're going to make fees on the back of that and then the final point probably to look out for is the lower net interest margins You know flatter yield curve, you know rates back to historical low levels And then the final thing I would say is is about forward guidance What is it then that people are looking at? You know if you think about If you go back to What goldman's were saying which was Here this was what goldman's were saying yesterday about earning season They said stocks have probably bottomed on policy support Despite the likely steady stream of weak earnings reports They see Q-mine earning season will not represent a major catalyst for equity market performance And I think I kind of agree with that. I mean everyone knows that this earning season is going to be pretty horrific And they knows that actually the next one's going to be even worse So actually I think one of the things for me that I'm looking at is is the general forward guidance What do they see the end of the year looking at how significant is that impact going to be? We know now is bad But what's the type of shape of recovery that they're anticipating from their profit? performance point of view That and also be keeping an eye on dividend payments We've seen in Europe HSBC UBS credit Suisse halting cancelling their dividends are we going to see that as well in the US To come a few other things. I thought was quite interesting and this is looking at the S&P 500 earnings revisions breadth So this just goes to show the severity of how Wall Street analysts have had to severely re Or re-evaluate and put out fresh estimates of a much more negative position of where we are now from just a few weeks ago Pretty much the worst since then the financial crisis of 2008 and then one of the other things I was looking at from an earnings perspective This morning was this was a chart here that basically is estimate dispersions And what that means is how much the highest and lowest per share prediction varies on the average stock and Basically, that's sort of near record levels that we saw during the financial crisis So what this is telling you then there's there's been an immediate global shock event being coronavirus that's caused analysts to severely Review and and reanalyze and put out fresh more negative estimates But the variance of those estimates is the widest it's been since the financial crisis meaning that you know It's quite a tough thing to try and quantify from an equity analyst point of view at this point in time So again given that point I think that does soften the blow a little bit about then The kind of freedom that these numbers have to kind of beat and miss and for it not to really impact sentiment too much So it's been a lot of hype about earnings is going to be reality hitting home for me. I think it already has hit home I don't think they're going to come as a great shock here and the bar in my mind for corporate earnings season has been set Particularly low meaning then that I think an okay earning season actually might be received In in quite a positive way in that respect If you are interested I've shown you this before but this is the the kind of amplified trading Learning portal that we have for new traders and as much as it is a portal It's a subscription monthly payment where you go through a kind of sequence of chapters that teach you the one-on-one about everything You need to know to analyze and trade financial markets But what we've been doing is updating a rolling section where Sam North puts out his trade setups every day But Eddie the chap I just mentioned who did that linked in post He's done a great video as a guide to earning season, which he's just uploaded to the portal So exclusive to that we don't put that sort of stuff out on YouTube But all of these types of more snippet we call it macro now Research that we do goes on to that portal. So do check that out. I'll put a link to it in the in the video But that is it no, I think that's enough Obviously for this week as I said going all the way back to the calendar Today's all about earning season probably gonna just capture a bit of an imagination Because it's the first ones and that tends to act as a bellwether then for the rest of the sentiment and the season depending on how some of these First banks come out namely JP and Ros Fargo US retail sales Wednesday Chinese data on Friday And then finally I'll just set one more time Don't forget to subscribe to the channel so I can see you tomorrow But yeah, feel free to ask me the questions in the comments and I wish you a good day and a week ahead Thanks very much guys