US EARLY MORNING: US index futures are seeing upside at the start of the week, but we are off highs

US equity futures are trading higher (RTY +0.8%, NQ +0.7%, ES +0.7%, YM +0.6%)–but off highs–after the S&P 500 slumped to its seventh weekly lost on the trot, just avoiding a close in technical (and arbitrary) bear market; weekend press reports have been focussing on the bear case (we recap the main arguments in the “Bear market” section, below). Once again, we are contending with the same catalysts that we have been in recent weeks: central banks determined to tighten monetary policy to control surging consumer prices, signs that the consumers are now feeling the impact of sharp price rises in an indication that higher prices are starting to hit activity; these come amid a background of heightened geopolitical tensions (which are essentially inflationary and harmful to supply chains, whether were are looking at Russia-Ukraine or even China’s zero COVID policies); lofty valuations have also made it more difficult for investors to buy-the-dip. This week, the FOMC meeting minutes mid-week and PCE data for April at the end of the week (we’ve already had the CPI and PPI reports for the month, note, but this is the Fed’s preferred gauge – more in our weekly here) should keep the theme of tightening policy in the face of price pressures in focus. So far, Fed officials have held their nerve in the face of the sell-off in risk assets, and many think they will continue to do so until the war against prices has been won (in fact, officials have suggested as much); any cracks in this view, however, could be positive for risk assets. The day ahead is thin, but as Davos comes into focus, we expect there will be much jawboning from officials this week. Day ahead calendar here

BEAR MARKET TERRITORY:

US EQUITY KEY LEVELS (per Credit Suisse):

CHINA:

TECH:

ENERGY:

CONSUMER CYCLICAL:

INDUSTRIALS:

MATERIALS:

FINANCIALS:

HEALTHCARE:

IPO:

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23 May 2022 - 09:29- CryptocurrencyResearch Sheet- Source: Newsquawk

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