The World elite is meeting in Davos

Daily Analysis - 23/01/2018

Davos Dominates Headlines

davos-world-elite


In Davos, Switzerland, the 48th Annual meeting of the World Economic Forum begins today. It will last until Friday, and the theme is “Creating a Shared Future in a Fractured World”. It is worth mentioning that US President Trump will attend the meeting.

The World Economic Forum in Davos


The world’s top thinkers, policy makers and executives arrived in Davos for the World Economic Forum, a tiny village in the Alps.

In Davos, Switzerland, the 48th Annual meeting of the World Economic Forum begins today. It will last until Friday, and the theme is “Creating a Shared Future in a Fractured World”. It is worth mentioning that US President Trump will attend the meeting. This will be the first time a US president shows up since Bill Clinton in 2000. President Trump will deliver a speech before the closure of the meeting on Friday, which could become the forum’s centerpiece. French President Emmanuel Macron and UK Prime Minister Theresa May will also deliver remarks, on Wednesday and Thursday respectively.

The Davos planners have identified 8 important society related issues to be discussed in a series of panels that begin with “We Need to Talk About.” Those main points include privileged class, immigration, harassment, religion, mental health, race, LGBTQ identity and disability.

While the full roster of attendees was closely guarded in the past, the organizers make the list with of participants’ public ahead of the forum. This year’s conference includes heads of state including Donald Trump, international financiers like the IMF chairwoman Christine Lagarde, titans of industry like the American business executive Ginni Rometty, high-profile academics like Adam Grant, well-heeled philanthropists as an example George Soros, and even royalty like the Queen Rania from around the world.

popup_close
usdjpy-d1-alvexo-ltd

2nd Downgrade in a Week for Apple


Investors fear iPhone demand is softening. Atlantic Equities lowers its rating for Apple shares to neutral from overweight, predicting weaker-than-expected sales for the company's Q1 2018. Longbow Research downgraded Apple last Wednesday.

We see "signs that iPhone demand is starting to soften, limited visibility into the potential for future iPhone cycles and emerging challenges to the smartphone's dominance at the center of consumer technology," the firm says.

IPhone demand will disappoint this year, according to another Wall Street analyst.

We see "signs that iPhone demand is starting to soften, limited visibility into the potential for future iPhone cycles and emerging challenges to the smartphone's dominance at the centre of consumer technology, we believe the stock's multiple will compress, limiting upside potential," analyst James Cordwell wrote in a note to clients. We are "lowering our March qtr revenue estimates and are now below consensus for Q2-Q418."

The price target for Apple shares is $190, representing 6.5 percent upside to Friday's close.

Suppliers and manufacturers give signs for the future path of the iPhone sales. The analyst said recent supply-chain data points from Apple's suppliers have "turned negative." He also said the comments from the suppliers were much more optimistic during the iPhone 6 launch at this point in the cycle.

Apple was down 0.8 percent in early trading Monday. The company's stock is up 49 percent the last 52 weeks.

Apple is still overwhelmingly recommended on Wall Street. It has 28 buy ratings, 9 hold ratings and 0 sell ratings among analysts, according to FactSet.

popup_close
apple-h1-alvexo-ltd-2

The South African is Bullish


The rand against the dollar has traded to its best levels since May 2015 and remains firm against the GBP and EUR as well as its emerging market currency peers. Strength in the rand has extended over the weekend following developments within the ANC (leading political in South Africa) NEC (National Executive Committee) meeting over the weekend.

Even though it was not on the meeting agenda, the ANC NEC saw a try to recall President Jacob Zuma being debated in an attempt to re-establish trust in the political party, ahead of the 2019 elections. The debate concluded with the issue now being referred to the ANC top 6 officials. Among the major headlines, they suggest that the president’s recall now appears imminent, although the timeline remains unclear.

Further bullish momentum of the rand can be attributed to developments around ailing State Owned Enterprise (SOE) Eskom, South Africa’s power/energy utility. A thirteen board member shake up, including a newly appointed Chairperson, sees the presidency removing former executives accused by allegations of corruption.

The movements for the rand against the dollar have been the most noticeable supported by the weakening of the greenback.

popup_close
usdzar-d1-alvexo-ltd

Germany’s ZEW Economic Survey


Among the important Economic Announcements of the day is the German ZEW survey for January. The current conditions index is expected to grow to 89.8 from 89.3 in December, while the expectations index is expected to have increased to 17.8 from 17.4. The euro growth could confirm such data and explain the robust momentum in the Eurozone’s economy.

The January edition of Germany’s ZEW survey of investor confidence dominates the data docket in European hours. Even though the sentiment is expected to improve a bit, the outcome seems unlikely to generate much a response on the Euro FX pairs as traders await Thursday’s ECB monetary policy announcement before committing to a firm directional preference.

On the daily and weekly charts, the price structure continues to suggest a broader uptrend where we see the case for the bulls picking up again soon.

popup_close
eurusd-h1-alvexo-ltd-2

Upcoming Events

  • Time
  • Currency
  • Event
  • Forecast
  • Previous
  • 8:30 GMT
  • JPY
  • Bank of Japan – Press Conference
  • 12:00 GMT
  • EUR
  • German ZEW Economic Sentiment (Jan)
  • 17.8
  • 17.4

Risk Warning : CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money