Today the European session sees positive EU and US futures. NASDAQ + 1.40%, S&P 500 (S&P 500) + 1.10%, DAX +1.72%, FTSE MIB +1.8%, at writing.
As expected, tensions between Russia and Ukraine appear to be easing. President Vladimir Putin has instructed Russian Foreign Minister Sergej Lavrov to continue negotiations with NATO leaders. Putin would have said 'okay' at the request of his minister to go ahead with the negotiations.
In the US, the theme of inflation is always in vogue. St. Louis Federal Reserve Chairman James Bullard again said the Fed needs to hurry to intervene, his second statement in a matter of days. I think we have to anticipate what we have planned, 'he told CNBC,' We were surprised by the rise in inflation.
There is a lot of inflation, 'Bullard said. The central bank board member says he is concerned about an insufficient rapid response. 'Our credibility is at stake here, and we need to react to the data,' he added. However, I think we can do it in an organized and non-disruptive way for the markets.
In Europe, an important figure was expected today, the (ZEW) which determines the sentiment of German institutional investors. The figure fell below expectations but exceeded the previous reading.
Hot Stocks and Instruments
gold: News of the closure of the US embassy in Kyiv helped push gold (GC) to eight-month highs of $ 1,880 an ounce.
Moderna (NASDAQ:MRNA) falls to a ten-month low.
Rivian Automotive (NASDAQ:RIVN): We learned from the market regulator that the fund of the financier and philanthropist, George Soros, bought 20 million shares during the last three months of 2021. The investment was worth approximately two billion dollars but, at today's prices, it is a lot less.
Natural gas: Lower-than-normal temperatures are expected in the next 7-15 days in the US.
Conclusions
As expected, the chances of an armed conflict are decreasing, and the markets are already starting to rise. As history teaches, these days represent opportunities to buy, as the stock exchanges have always regained confidence in a few weeks after the collapses due to possible wars.
On gold, I expect a significant reversal in the short term, the rate hike is imminent, and with the end of tensions in Europe, we could see a sell-off of the safe-haven asset, with the $1750 area within reach.
I have often talked about Moderna in recent months; the pandemic commercial premium for these companies is over. The sector’s stocks could return to pre-pandemic levels. On Rivian, the situation is fascinating. Growth and orders estimates are very promising. The stock is worth $120, with a significant 100% potential upside.
On gas, the season of summer contracts is starting to approach, and I will be looking to open a long-term position. As for oil, I expect a summer rally on gas as well, with record demand that supply will not keep pace with.
In the short term, prices are supported by a colder than typical climate and geopolitical tensions.