Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

Early Morning Call: renewed recession fears hit equity markets while USD climbs

Concerns about the outlook for growth hit markets on Tuesday with some global indices down at three-week lows.

Macro overview

Equity markets were down overnight following the lead of US session yesterday. The mood dampened as top bankers from JPMorgan, Bank of America and Goldman Sachs said they were gearing up for a potential recession next year.

According to JPMorgan CEO, Jamie Dimon, American consumers are still supporting the US economy with consumer spending, but that may change in 2023. He told CNBC yesterday that consumers have $1.5 trillion in excess savings from pandemic stimulus programs, but are now spending 10% more than they did in 2021.

Australia's economy expanded in the third quarter (Q3), for the fourth quarter in a row, but at its slowest pace in the sequence. GDP rose 0.6% in the third quarter, compared with 0.9% the previous quarter and just under forecasts of 0.7%. Annual growth rose by 5.9% year-on-year (YoY), compared to expectations of 6.2%.

China trade surplus missed expectations as exports and imports shrank at a much steeper than expected pace in November. Exports contracted 8.7% in November from a year earlier, the worst performance since February 2020, and well below analysts' expectations for a 3.5% decline. Imports fell by 10.6%. Economists expected a 6% fall.

In Europe, Germany industrial production fell less than expected in October. Industrial output was down 0.1% on the previous month. Expectations were for a 0.6% decrease.

And Halifax house price index showed the sharpest month-on-month (MoM) decline in the UK in 14 years, down 2.3% in November. Year on year, the index rose 4.7%, nearly half the pace recorded the previous month.

At 10am, market awaits the final estimate of eurozone GDP in the third quarter. Economists anticipate a 0.2% fall compared to the previous quarter.

Later this afternoon, the Bank of Canada (BoC) will unveil its last rate decision in 2022. The market expects a 50 basis point (bp) increase to 4.25%. At its last meeting in October the Bank hiked its rate by 50 basis points to 3.75%, which was lower that the 75 bp expected.

Its governor, Tiff Macklem reiterated last week that "If we don't do enough, Canadians will continue to endure the hardship of high inflation. And they will come to expect persistently high inflation, which will require much higher interest rates and, potentially, a severe recession to control inflation," adding that "If we do too much, we could slow the economy more than needed. And we know that has harmful consequences for people's ability to service their debts, for their jobs and for their businesses."

Equity markets

On the equity market, Moonpig Group posted an adjusted profit of £18.9 million in the first half (H1), after £24.1m a year ago. Revenue rose 115.4% to £142.8m. The group indicated that trading conditions have become progressively more challenging through October and November.

Mitchells & Butlers the owner of Harvester and All Bar One, posted a full year (FY) operating profit of £124m, compared to £81m a year earlier. The pub group flagged challenges arising from surging energy and labour costs.

Airbus announced yesterday that it was abandoning its delivery target of "around 700" aircraft in 2022. Airbus has delivered a net total of 563 aircraft between January and November, which led to analyst estimates of a total of 680 potential deliveries this year.

Commodities

Brent has fallen below $80, nearing 2022 lows.

Yesterday, API inventories followed the same pattern as last week: crude oil stock dropped, while refined product stocks increased. Crude oil stocks fell for a fourth week in a row by nearly 6.5 million barrels, while gasoline stocks increased by 5.93 million barrels and distillate stocks by 3.55 million barrels.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Start trading forex today

Find opportunity on the world’s most-traded – and most-volatile – financial market.

  • Trade spreads from just 0.6 points on EUR/USD
  • Analyse with clear, fast charts
  • Speculate wherever you are with our intuitive mobile apps

See an FX opportunity?

Try a risk-free trade in your demo account, and see whether you’re onto something.

  • Log in to your demo
  • Take your position
  • See whether your hunch pays off

See an FX opportunity?

Don’t miss your chance – upgrade to a live account to take advantage.

  • Get spreads from just 0.6 points on popular pairs
  • Analyse and deal seamlessly on fast, intuitive charts
  • See and react to breaking news in-platform

See an FX opportunity?

Don’t miss your chance. Log in to take your position.

Live prices on most popular markets

  • Equities
  • Indices
  • Forex
  • Commodities
website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.

" edit-mode="false" style="--live-prices-table-rows:5" >


Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Sunday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.


For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of spread betting and CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.