 All right, very good morning. Wednesday the fifth of January. Let's hop straight into it and talk about the charts this morning at the European Open and relatively flat across the major asset classes. So whether you're looking at the currency pairs, top left, gold, top right, T-notes, bottom right or WTI crude at the bottom center chart, they're all pretty much trading unchanged. The one thing that is moving a little bit are European equity index futures just gone through the cash open here 8am in London and just seeing a bit of an uptick, DAX positive up around 41 ticks in the futures market and US equity index futures just coming off their eight pack lows following what was a mixed close on Wall Street. We finished pretty flat in the S&P, gains around 0.6 in the Dow, losses in the NASDAQ of around 1.3% as tech firms generally globally being weighed a little bit at the moment by the higher move seen in US Treasury yields. But in terms of yesterday's session one thing I did just want to touch upon because still an overarching theme generally globally both in mainstream media and markets still is the Omicron variant and as I'm sure you've read we're seeing record numbers of new cases in the likes of the UK, France, Italy, in the US, topping a million in fact and yet overall the belief seems to be emerging around or at least gaining traction around the economic threat of the Omicron coronavirus variant being somewhat limited that being at the end as we trickle down through from case rates down to proportionate amounts of hospitalizations although there is pressure growing in the likes of the UK and so on as emitted by the UK Prime Minister yesterday the idea here is that more onerous restrictions are unlikely to be needed and that means then that the economic consequences far less severe than what we've had in previous instances in the pandemic around a year ago also and as such then travel and leisure stocks as you can see here from the headlines from yesterday in London listed shares the budget carrier Whiz Air was up around 12%, British Airways owner IAG was up a similar margin, EasyJet also added around 9% at the close in London trade yesterday also as well crude oil gained in New York on Mondays or I should say Tuesday's session and that came really twofold as I've described then helping on the demand side of things but also more broadly from an OPEC expectation all pretty much as planned so OPEC plus agreed to revive more halter production as the outlook for global oil markets has improved demand largely withstanding the new coronavirus variants they continue to bring on more oil as they go through their monthly kind of temperature checks of where we're at at this point in time not much surprise there but crude oil did move higher pretty much under the same idea as what was driving some of those travel and leisure stock names one thing though from the overnight session a little bit more sour you could say in APAC trade generally as I said global tech firms under a bit of pressure did push the dollar to a five-year high against the Japanese yen in overnight trade Hong Kong in particular tech stocks lost about nearly 4% pressure there coming from China's fines the authority still cracking down on the tech sector so Alibaba 10 cent were some of those names falling after they failed to properly report about a dozen deals and so that amid new cyber security rules continues to be a bit of a headache for that space then over overnight as well just to follow up on some of the things we were talking about yesterday was coming out of the Chinese securities journal which reported that China to timely replenish liquidity shortfalls with cash injections before the Lunar New Year holiday there was some I guess nervousness emanating really from a Bloomberg article talking about large volume of the potential squeeze that that market could see and the negative connotations that could have however as is nearly always the case given the global shutdown or the Chinese national shutdown that we see for Lunar New Year holiday in a couple of weeks time they're going to come in and and give plenty of liquidity one would imagine to avert any type of disruption that that that holiday could cause so everything as you would expect otherwise other headlines we did have press conference of course with the UK Prime Minister Boris Johnson yesterday said the UK can weather a record wave of COVID-19 sweeping the country without tighter restrictions and again goes back to the first point that we're saying is why some of those airline stocks were soaring yesterday that came even as he warned the NHS is under growing strain and we saw a record 218,000 cases coronavirus reported on Tuesday there is a bit of a backlog some would say with the reporting numbers at the moment we've obviously just had Christmas and the new year the US set a global record of almost a million new coronavirus infections on Monday according to Reuters tally that's nearly double the country's peak hit just a week ago but reporting delays over Christmas and more people getting tested ahead of the holidays is thought likely to have contributed to some extent to that very high figure a couple of things in context here that again I think help is hospital admissions average 14,800 per day last week in the US that is up 63% but is lower than the 16,500 of a year ago and deaths have also been stable over the last fortnight averaging about 1200 a day and that compares with around 3,400 that we were seeing a year ago so quite substantially lower there on that final point all right elsewhere just on bitcoin really it's been fairly dull i'm looking at bitcoin more recently certainly a little bit more somewhat stability coming into some of these these crypto currencies of late bit of a sensational headline Goldman says bitcoin 100,000 of possibility by taking on gold now don't get excited this isn't going to happen tomorrow they're pretty much talking about a five-year outlook here so to give you a bit of what their their rationale and what they're talking about they say bitcoin will continue to take market share from gold as part of a broader adoption of digital assets making the often talented price prediction of 100,000 by advocates a possibility um Goldman estimates bitcoin's float adjusted market capitalization is just under 700 billion u.s. dollars that accounts for 20 share of the store of value market now the store of value where you park your cash in terms of times of strife traditionally that being gold but what they're generally saying is that as bitcoin has more kind of adoption that starts to build into that store of value kind of asset if you like and that being comprised of bitcoin and gold and the value of gold that's available for investment is estimated at 2.6 trillion u.s. dollars and if bitcoin share of the store of value market was hypothetically to rise to 50 percent they're saying around currently um 20 percent over the next five years the price increase would be a tantrum out to around 100,000 for a compound annualized return of 17 or 18 percent so again it's a little bit more bold as a headline as you would expect news agencies to spin it's not really i'd say that exciting to be quite honest i'd i'd be shocked if bitcoin wasn't 100,000 in five years time just given the where we're heading with decentralized finance um otherwise just having a look at the calendar for today um what have we got on the docket well you've got the oil services PMIs coming out from europe however these are december final numbers so they're not going to be particularly exciting or market moving um heading into non-farm perils of course which we get on friday you do have the adp national employment figure coming out this afternoon at 115 expect it to be relatively stable from last month's 534 to come in the headline expectation of 500k um then you've got your relevant uh us market final reading as well for services PMI at 245 you've got oil inventory data coming out this afternoon and that comes after we had the api data last night so actually quite meaningful numbers from a statistical perspective the drawdown in crude last night was 6.432 million that was the biggest drawdown since the summer gasoline though was a big build biggest is april 2020 at 7 million um however how much did oil move hardly anything at all um don't forget it did come in the context of still the ongoing um developments on the omicron side but also the opac plus meeting yesterday so it very much got brushed aside but these will be your reference points for those DOEs when they hit the tape at 3 30 this afternoon and then the final thing to speak of will be the FMC minutes they'll be coming out at seven o'clock later on this evening london time they may shed some more light on the potential pace of rate hikes going forward you will remember we had the latest dot plots coming out of the the US central bank in there their last meeting which looked a little bit like this uh and if you're not familiar with the dot plots what essentially this is is every alternative meeting four times a year when the FMC gather they ask those officials for whether they see interest rates at the end of that year and the subsequent years thereafter and quarter to quarter we get to see the changes that they see according to economic conditions of how steep or shallow then the rate trajectory curve is is changed and what we saw if you remember at the last meeting was that Fed officials in the dot plots said expectations were for three quarter percentage point increases to the key federal funds rate in 2022 and so any more color around that just given some of the yield movement we've seen since the commencement of 2022 which has been much more aggressive akin to potentially the idea of the Fed moving even earlier than probably what would be anticipated being a June set deck hike to something more towards potentially March which was when then the timing is for the end of the tapering process which is well underway at this present point in time so looking for more color interesting to note that the uber dove from the FMC Neil Kashkari was speaking yesterday and he said he now sees and supports two rate increases this year to counter risks posed by inflation so even a most dovish member is not quite seeing three but is definitely seeing two rate hikes at this point in time so kind of moving up the board if you like all right that is it gonna leave it there and wish you guys a good day so if you're not subscribed to the channel don't forget to hit the subscribe button click the bell icon updates like this coming every morning and then ad hoc pieces coming as and when there's major news to talk about all right guys have good day and see you tomorrow