Trading is mixed in Europe on Wednesday, with Wall Street eyeing a slightly stronger open amid bumper Netflix earnings.
Netflix is a hit
Netflix results are expected to be a hit on Wall Street when the bell rings on Wednesday, with pre-markets pointing to a more than 13% rally in the stock. The streaming company reported revenues and earnings that comfortably surpassed expectations, while subscriber growth more than doubled forecasts. That was largely driven by the Asia-Pacific region which will become increasingly important for growth in the coming years. The company will continue to crack down on password sharing going forward, while the ad-supported plan will hope to draw in additional subscribers. After a tough year, things may be looking up for Netflix.
UK inflation back in double-digits
Inflation in the UK surpassed 10% again in September, slightly beating market expectations and further fueling concerns about the cost of living crisis and the role of the Bank of England in reining in rapid price increases. Naturally, all of this has been complicated by the political soap opera over the past few weeks, something the new Chancellor, Jeremy Hunt, has sought to calm by abandoning almost the entire controversial mini-budget.
But inflation is still a problem, regardless, and the BoE will have to be very aggressive at upcoming meetings in order to try and get a grip of it. Markets are now undecided between a 75 and 100 basis point hike on 3 November but are quite confident that Bank Rate will end the year at 4% either way. With inflation now broad-based and fuel even offsetting some of the larger price increases, the worry is that these forecasts may prove too optimistic.
Intervention talk ramps up as USDJPY nears 150
Japan remains in focus as the dollar closes in on 150 against the yen. The threats of intervention have been coming thick and fast and many are wondering if 150 could be the point at which the Ministry of Finance pushes back once more. The last intervention wasn’t particularly successful, with the benefits unwinding in a matter of days. The question now is when they’ll jump back in and how forceful they’ll be. The message is clearly falling on deaf ears at the moment.
Continuing to fluctuate
Bitcoin continues to consolidate, with the recent rebound failing once more around $20,000. That level was once believed to be hugely significant as support but the reality is that it has simply become the point at which the price fluctuates around. That will change eventually but we’re now two months into that broadly being the case so there’s little to suggest it’s imminent.
For a look at all of today’s economic events, check out our economic calendar: www.marketpulse.com/economic-events/
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary.
His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News.
Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
