 Okay, very good morning to you before I begin don't forget as per usual to subscribe to the YouTube channel new content coming Every day of the week for myself and the rest of the team I'm going to focus on as per usual the kind of macro top level fundamentals of what we're looking out for not just today But this week, but if you want the technical setup video as issued by Sam yesterday You can find it on the channel by just finding his category So let's just have a look at the the charts this morning and what have we got in store. So Yeah, a little bit of risk off I guess in terms of the equity index futures seen negative at the moment does follow a little bit of a downside session seen in Asia Some significant individual single stock news seeing HSBC standard charter shares in the Asia Pacific Time zone coming under some pressure. So keeping an eye on them at the open of footsie trade I'll get into that in a little bit more detail shortly Otherwise in the FX market the dollar was weaker overnight Or be it has just bumped up a little as Europe has come in but that does see then Euro dollar in slight positive territory Also cable just sitting above its pivot in the futures Euro dollar you can see here just running into some Resistance and around the highs that we're seeing towards the back end of last week Also during the Asia Pacific session noting as well that Japan was out overnight there on market holiday not returning Until Wednesday So elsewhere fixed income pretty quiet gold as well relatively range bound Oil a little bit negative bit of a break of a trend line in the short-term technicals this morning And that $41 handle here just with those previous lows that was seen at the opening of electronic trade Maybe just acting now as a little of resistance on that last run low. We've had more recently But moves relatively contained at this point in time Right, so let's get let's get stuck into some headlines Quite a few things starting off with HSBC shares Fall to a 25-year low So why has this happened? Well, their shares were down in excess of 4% at one point standard charted down a similar margin in their Hong Kong shares And they dropped after media reports that they and other banks move large sums of alleged illicit funds over nearly two decades In addition to this HSBC is a possible candidate for China's quote Unreliable entity list that aims to punish firms organizations or individuals that damage national security according to the Global Times which is the kind of state-run media newspaper in China in the mainland that came out over the weekend China have issued rules regarding as proposed Unreliable entities list while it reportedly do not have a timetable or preset names of companies They warned that foreign firms if they violate nation's laws or commit illegal acts It could be included in this list and face measures now although over the overnight session China have denied this Those media reports do hint that US firms of potential targets from that list could include lights at Qualcomm, Cisco, Apple and FedEx as well So worth keeping on those guys at the market reopen in a few hours time on the nizy But yeah, HSBC getting pretty pounded overnight Does come after you know just in that that local region Whether it be trade war whether it be disruptions that have been seen in Hong Kong and the national security law or the ongoing protesting that's been happening, you know their shares now I think they're down roughly 50% on the year So incredibly difficult times there and not only those two banks, but Deutsche Bank as well Appears to have facilitated more than half of the leaked two trillion dollars of suspicious transactions that were flagged To the US government over nearly two decades is part of the same story That was weighing on those other banks and DB shares head of the cash equity open are called down around 7% at the market open. Well, let's get the latest We're seeing down around 6.8% at the moment So that was some of the overnight stuff Otherwise elsewhere a lot of the weekend press has been filled with COVID updates I'm not sure if you were out and about over the weekend, but again managed to go for a bit of a walk on Sunday and it was Super busy. I did say this before the lockdown From the group gatherings from 30 to 6 and I was commenting I remember this time last week about how to walk along South Bank and it was absolutely heaving Well, this time I went to Battersea Park anyone familiar with London and I have never seen it that busy in my life Enough that I felt uncomfortable and and wore my mask All day rather than just generally when it's necessary when going into shops that so I've said this last week and I'll kind of repeat it. I think that and it's already being seen, but I think it's going to get a lot worse just the general Lack of I guess adhering to just general sensibility of the Realization that we are still in the middle of a pandemic just by the broad mass I think that these rates are going to get far worse than what they are At the moment and hence the reason why I think you're starting to get a lot of these noises this morning The government knows this is the case So what what have we got here? Well, Britain is said to be at a critical point now In the coronavirus pandemic Boris Johnson is set to say today as concerns mount of a second lockdown That might be needed to stop the renewed spread of the disease So daily cases now as we were seeing towards the end of last week at their highest level since May Hospitalizations in England are doubling every eight days and there are number the reproductive rate For the virus now stands at between 1.1 to 1.4 as of Friday. So Anticipation is that number will be rising the warning comes as well amid expectations that local restrictions could be extended to London Mayor city Khan was speaking the telegraph over the weekend will recommend Tightened rules on the capital later today is the expectation This will include then the potential for pushing people back to working from home if possible rather than going into the office Separately one of the other things that's come out is Rushi Sunak has indicated further support is needed to prevent large-scale business collapsing Plus job losses He is preparing to extend for loan programs that have already issued some 53 billion pounds of credit for companies through state guarantees according to the FT it still isn't Thought to believe that Sunak will extend the furlough program But he's preparing these other measures according to those close to the situation also as well as just last Tuesday I think the Chancellor gave a speech where he was saying that extending furlough is not the right situation One of the things that they fear here is that they're basically propping up I guess what you could call zombie jobs that are only there because companies are getting backstopped by the government paying for large proportion of people's salaries and that if that was to be removed then they would just fire them anyway, so Here I guess what the approach would appear to be is that there's a wave of job losses set to come then at the expiration of furlough at the end of October and so what he's looking to do then is provide extra credit facilities to a number of Companies so that they can still function and operate So yeah, there's seemingly then something to keep an eye on Not just in the UK, but Europe as well mainland Europe is experiencing equal size rises at the moment in COVID-19 cases Similar news I guess in regard to the virus AstraZeneca stated its vaccine trial in the US still remains on hold Remember that was thought to have come back in last Wednesday after we saw that previous weekend disruption Due to the halt in that trial still that I think that that's the real major thing at this point It's still relatively normal practice and procedure to see these types of halts to investigate As per what happens that particularly individual in question in the UK as response to those clinical trials, but Yeah, the COVID situation is worsening in important economic areas mainland Europe and the UK and depending on the severity of course of the types of Rollback of them moving back in towards more tighter more stringent lockdown Obviously is going to have repercussions then on the economic recovery of these countries in question So yeah, this will be a recurring a big thing. I'm sure throughout the week Sticking with the UK one of the other things that a lot of people are looking at on the calendar this week Is this chap? This is governor of the Bank of England Andrew Bailey, of course And he's going to be speaking a couple times this week But before that we did have the chief economist He spoke at the weekend Andy Haldane and he actually said that the UK is recovering faster than anyone expected Yeah, probably a little bit ill times just given the situation what's going on with COVID But that's beside the point that I think what Haldane is being used for here Which is a tactical approach by the Bank of England to manage and tame runaway expectations the Bank of England will immediately adopt negative interest rates and the way that Financial markets tend to react as we over interpret what central banks say This is just general human psychology. We take one little morsel of information and we run with it and obviously after the kind of The revealing of the progressive talks that they had been having Regulators about the mechanics of how the negative interest rates work It's about as close as we've got without inaction in negative rates that they were definitely heading toward that direction Potentially in the future. So for me, this is kind of Central banking 101 communication tactics you send out arguably the most hawkish member of your monetary policy committee Which is well known is Andy Haldane. He comes out talks the other side of the book just to make sure that Investors are kept honest And it doesn't get to a point where the Bank of England has to deliver that policy response That's definitely what they don't want to do They want to assure markets But they don't want markets to be priced so certain for a rate cut into negative territory that they then have to deliver It at fear of disappointing markets and causing, you know, a loss of confidence So I think I wouldn't read too much and over interpret Haldane's comments and what can we expect from Andrew Bailey, he's going to be speaking. He's giving two separate speeches on Tuesday and Thursday this week I would expect him to not really give away too much I would say that don't look for anything to explicit the appropriate hints that he wanted to Convey I guess from the Bank of England meeting have now been deployed So I would be looking for too much Additional guidance, but it will be something that will need to be watched quite closely and obviously would carry the propensity to move The sterling currency quite sharply Looking at the US this was one of the other things that Has come up as a bit of a talking point and probably will do so state side Because you might not have heard of Ginsburg But the death of Supreme Court Associate Justice Ginsburg Has opened another front in the election battle with President Trump intending to make a nomination in the week ahead So this is about then the potential to have a more let's say Trump Conservative Political alignment in terms of the positioning and nomination of the candidate he would want to put forward Which could then have a knock-on repercussion of being more beneficial for him should as we expect then the mail-in ballot process of going into a US election the result is unlikely to be known for a number of weeks There's probably lots going to be lots of legal action about contesting over certain Results over certain states and so having a Supreme Court Associate justice in his favor is going to be much more beneficial for the prospect of him potentially winning the US election So he's very much going to be on it and it's already been a dominant theme over the weekend And one of the things that I think this could be then is is it going to detract from what was looking like some slight progress in? Stimulus talks in America where you had you've got this kind of Ongoing debate and we've seen some movement But the lights of Pelosi for example still standing pat at 2.2 trillion And that being too much what the Republicans want at this point in time But are they going to be now distracted given the legal consequence and the repercussion this could have on the overall outcome of the election over this particular Vacancy now in this role To give you a bit of idea Lisa Murkowski and Susan Collins have come out against pre-election confirmation of a nominee and they are two Republican senators Opposition from two more GOP senators would put brakes on the process So just in terms of what to look out for on how to interpret the news I'll be aware of that I'm just having a quick look at the US equities at the moment I did see technically I was looking on some daily charts this morning and we have got beneath what I thought was quite a key area Which is this trend line going back to April We've had a test a couple times in May in June and then some of the recent price activity through the earlier part of SEP and a failed break on the 17th last Thursday So we've gapped below there and that does that trend line kind of map the 50 DMA very closely Which would be in a key level of near-term technical relevance. So here now It does look quite interesting from a potential For a little bit of a short-term push on the downside here thirty two eighty four and a half would be that high point From the peak before the intensification of trade tensions with China And I think below there on the week if we did push lower down Thirty two thirty one and a quarter would bring in that previous recovery high we had in mid-June That was an area of resistance as well. You can see in mid-July as well Would be a target and then down to thirty two hundred and thirty one ninety two if that were to continue as a trend The NASDAQ similarly has come to quite an interesting point on the chart from a daily continuation point of view and I was looking here at Really this Rectangles that I've colored which was an area of previous resistance and support which the market has respected really on a number of occasions through July August and September it's kind of been like this area of which the market either Fails to get above or if it breaks it really does start to move then to the upside and interestingly we At the reopening of trade open just below what had been a key area of support You can see even more recently in the month of September on three previous occasions So be interested to see how you perform here. I mean technically then it does Mean that the NASDAQ could be susceptible to some deeper moves to the downside I'd probably be then looking at around 10,000 514 then 10 to 96 which starts to bring in those previous highs that we've seen in June which also Comes up to that EU COVID fear low that we saw on the progressive developments that we saw at the in Spain and the likes at the end of July So definitely I'd say equities a little bit susceptible here potentially for some downside Not so much North American COVID related, but if stimulus is there's a lack of stimulus still coming at the moment If people just losing a little bit of confidence Let's say on the global level because you came Europe COVID situation is worsening It certainly could be quite interesting to keep an eye on those those levels and if the trade war Starts to ratchet up a few notches again. It certainly could act as a bit of a catalyst A few other headlines just to be aware of this one. I don't think it's really major But definitely something perhaps to be aware of And this is the ECB is to review its flagship Bomb buying tool in fighting COVID crisis Basically debate on the length of the PEP program and on transferring its flexibility to other asset purchase schemes So this this could have I guess More dovish connotations about transferring it to other asset purchase schemes I if you think about the asset purchase program, could it be as flexible as this kind of pandemic response PEP? Process but it's probably too early to say this is just a review stage But something to just be aware of it's not really having any meaningful impact this morning A few other things on the weather front. We continue to see a particularly busy Hurricane period at the moment and the one we're focusing on here is a new one in the Gulf tropical storm beta And if we actually look at the the details here, you can see it's right in quite a key and sensitive area as far as the energy markets are concerned So the slow expected the expected slow motion of beta will produce a long duration rainfall event from the middle of Texan Coast to southern Louisiana There is the danger of life-threatening storm surge near times of high tide Through Tuesday along portions of the Texas Louisiana coasts within the storm surge warning areas So by the looks of it at the moment doesn't look quite to the intensity of some of the others that we've had of late But certainly just warrants keeping half an eye on at the moment And then just quickly looking and reviewing the overall candor for the week There are a few other things to be aware of so today is particularly quiet overall There really is not a great deal on the docket coming out as per usual really on the Monday And then as far as weekend headlines were concerned although I've covered quite a lot I wouldn't say there's one singular smoking gun that's going to mean the market's gonna go in either direction at this point There's just a lot of more kind of nuanced sensitive news flow coming out But Tuesday then we get Bank of England Bailey Speaking at the British Chamber of Commerce webinar, so that'd be the first of his speeches And then we've got feds chair Powell testifying to the house of financial services panels So this is quite an interesting one drone Powell is going to sit alongside the Treasury Secretary Stephen Mnuchin They will brief a congressional committee on the effectiveness of policies inactive to combat combat economic effects of COVID-19 Now markets may look for hints as to whether further fiscal stimulus measures are likely in the near term And if not, then how the Fed might react in that type of situation So definitely that'd be one that warrants watching as well. That's gonna be a 330 London time When we get round to Tuesday So again, you've got Bailey and power interestingly if you actually look just a quick glance across the counter for the week You've got feds Evans on Tuesday Powell on Wednesday You've got Evans and Rosengren on Wednesday Powell then to the house panel on Wednesday as well You've got feds Evans discussing the economy and monetary policy again on Thursday. So there's a lot of feds speak This isn't uncommon. They have just obviously unveiled a new policy tweak in the form of average inflation targeting And so it's they generally like to shoo that in and smooth it over in terms of its market Delivery or an interpretation of that new tool So I would be looking for too much from them But it's something to be mindful of and I guess that point of Look if stimulus doesn't come. What are you going to do about it? Is there going to be anything else that you can do support the economy as far as these politicians will be concerned? Moving on elsewhere Tuesday the other other highlights You've got existing home sales coming out the Fed Richmond Fed manufacturing But then moving on to Wednesday arguably then the most important as far as Europe is concerned Because then we start getting into the key focus which will be an update on the September confidence readings You get the flash PMIs. You've also this week. Got the German iPhone Reading so these will be particularly meaningful when we get to early Wednesday morning trade Manufacturing service PMIs. These are the flash readings, of course We also get the same out of the UK and the US later on Going into Thursday, then you get that German iPhone reading And then if we skip further into that afternoon, we then get Bailey's next speech and then Power and Managing testifying towards the Senate Banking Committee So they're really going to be a main feature throughout the week and in Friday is relatively quiet The only thing looking out for is durable goods orders One of the other things I'd say just to be aware of on Tuesday I know it generates a lot of media attention But Tesla have their annual shareholder meeting on Tuesday followed by their battery technology day So I am absolutely certain that Elon Musk will come out with a new Dance move or a new something that will see their shares go through an extreme period Probably a volatility So it's worth just keeping an eye out for that if you're monitoring that type of Stock and then finally on the calendar point of view for Brexit Gone but not forgotten. I'm afraid in formal talks between the UK and EU's negotiators will continue This week, but next formal round of talks is not until next week The UK government's internal market bill, of course will remain in the detailed committee early Next week in terms of getting its approvals another vote in the House of Commons lays ahead However, media reports suggest the PM now has done a deal with the rebel MP. So should ensure its its passage at this point in time And that's it. So yeah, any questions at all? Feel free to just drop me a line in the comment section. I'm always happy to help More videos coming of course Tomorrow, so I'll see you then. Good luck for today and this week. All the best