Equities Reflect Uncertainty Ahead of FedGlobal equities benchmarks are showing a sea of red across the European open on Tuesday. Yesterday saw choppy action across the board, likely reflecting some growing uncertainty ahead of the Fed tomorrow. While Powell and co are widely expected to opt for a smaller .25% hike, there are some fears that recent strength in US data might afford the Fed more scope to continue with tightening, creating the risk of hawkish signals from the Fed. This has been reflected in the better demand we’ve seen for USD over the last 24 hours with the Dollar continuing to see better demand so far today. US consumer confidence data later today will now be the main focus.Away from the US, better data out of China overnight is offering some encouragement for equities traders. The Chinese manufacturing sector bounced back into expansionary territory last month with the non-factory sector moving further into growth territory also. These readings are driving optimism over the potential for a broader recovery on the back of the Chinese government relaxing covid restrictions.Looking ahead today, a slew of top-tier US names are due to report with Exxon and UBS among the big names on deck. US stocks peeled back further yesterday reflecting some uncertainty on the back of some softer results last week from the likes of Microsoft. A key theme of recent results has been warnings over potential recession risks so traders and traders will be keen to see how today’s crop of large-caps view economic risks in the US.Technical ViewsDAXThe rally in the DAX has stalled for now into the 15163.41 level resistance. With momentum studies showing bearish divergence is growing, risks of a correction lower are seen. However, while the 14703.98 level holds as support, the broader view remains bullish.S&P 500Following the latest breakout above the bear channel from last year’s highs, the S&P remains rangebound between 3910 and 4153. These limits have framed price action since November and remain the key levels to watch for a move in either direction.FTSEThe rally in the FTSE fizzled out on approach to 7904.7. However, the move lower has been very corrective in nature and with price still sitting above the 7678.8 level, the focus is on a further push higher and an eventual break of current highs.NIKKEIFor now, the rally has stalled into a test of the 27422.9 level, ahead of a test of bigger resistance with the broken bull trend line and bearish trend line coming in just above. While this area holds, a further rotation lower cannot be ruled out. However, on the back of the recent bull move, focus remains on further upside for now with current downside to be short-lived.
