Dollar Edges Higher on Hawkish Fed Comments; Labor Data Eyed

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Dollar Up Over Fed Hints at Early Asset Tapering, Interest Rate Hikes

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Dollar firms as Fed members talk of tightening

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Allianz SE: Earnings Outlook: Q2 2021

Allianz SE, a German multinational financial services company with core businesses of insurance and asset management, is scheduled to report Q2 2021 earnings on Friday, 06 August 2021 prior to market opening. Allianz’s core insurance business includes the protection of property as well as life and health. In addition, there are also business areas with global reach, such as global corporate customer insurance, credit insurance, assistance services and reinsurance. Meanwhile, their asset management includes Allianz Global Investors (AllianzGI) and PIMCO.

https://www.allianz.com/content/dam/onemarketing/azcom/Allianz_com/investor-relations/en/results/2021-1q/en-highlights-1q-2021.jpg

Although Q1 2021 revenue fell 2.6% to €41.4 billion and was flat compared to the previous year’s level, the company reported a 44.8% increase in operating profit to €3.3 billion with contributions across all segments. Net income attributable to shareholders increased 83.4% to €2.6 billion driven by growth in operating profit and better non-operating results after lower impairment losses and higher income taxes had a slightly offsetting effect. Basic Earnings per Share (EPS) increased 85.2 percent to 6.23 euros, from 3.36 euros). The company targets a confirmed 2021 operating profit of 12.0 billion euros, plus or minus 1 billion euros.

https://www.marketscreener.com/quote/stock/ALLIANZ-SE-436843/financials/

Higher investment income came from Allianz’s fixed index annuity business primarily in the United States, while in Europe there was a lower decline in value compared to the highest level recorded in the first quarter of 2020. A further contributing factor was unit-linked management costs which were higher in Italy.

Overall the company has been able to increase its revenue, in a very challenging market. As such, recent analyst forecasts suggest that the company will continue to see its earnings expand broadly for the industry or on company fundamentals. With its shares down 3.0% over the past three months, it’s easy to overlook Allianz. However, stock prices are usually driven by a company’s long-term financial performance, which in this case looks quite promising. Tipsrank rated it moderate buy with an average target price of €239.54; EPS consensus forecast of €4.8 versus €3.71 in the same period last year.

Recently, Allianz  said that China’s local asset management unit has received regulatory approval and will become the country’s first foreign-owned insurance asset management company as Allianz takes advantage of regulations that relax ownership restrictions for foreign players in the asset management, insurance and securities brokerage sectors.

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Technical Levels

The #Allianz stock posted a historic peak of 353.55 in April 2000 and it took 20 years to return to the 61.8% retracement (232.55) in February 2020 before the global pandemic broke out. The economic recovery that has been going on since last year has not been able to bring #Allianz back to pre-pandemic levels, with the share price only strengthening to 223.45. The stock price on H1 rose +4.8% and closed at 210.35 in June, while in July there was no significant price movement; the asset tried to match the January 2021 open (200.70) with a low of 199.58 but closed at 210.30, just 0.20 euros lower of the opening price of 210.50 to form a monthly doji candle.

#Allianz, D1

The outlook is tentatively neutral after July’s decline that failed to surpass the opening price and remains temporarily stuck above the 200-day moving average. Throughout the early years to date, stock prices seem to be consolidating more than trending. Technical tools provide information that consolidation is likely to continue until the earnings report. The stock price has broken through the thin Kumo which is formed from a thin trading range, the RSI is flat between the middle 50 level (at 48.46 as of the time of writing) and the MACD is still in the sell zone with the histogram thinning to the neutral side. A break of the support level of 199.58 would be very decisive for the direction of the weakness, but as long as this level holds, the price projection is likely to test 214.30 and 223.45.

Click here to access our Economic Calendar

Ady Phangestu

Market Analyst

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

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Midweek Market Podcast – August 4

USD started the month under pressure, with yields lower and equities higher. The Kiwi has had a boost as expectations rise for a rate hike this month from the RBNZ. BOE & NFP still to come this week.

HotForex · Midweek Market Update – August 4

The Market Week – August Week 1 

Another volatile week to start the month; USD remains pressured as economic data reports are mixed, Equities hit all-time highs again supported by strong earnings and US treasuries hold onto their strong demand as yields sink.  All eyes now on the BOE (Thursday) and NFP & Canadian Jobs data (Friday).

It’s NFP week so jobs, earnings and unemployment take centre stage.  The weekly US unemployment claims missed expectations again, coming in at 400,000, with 382,000 expected this week. NFP is expected to be around 870,000 and unemployment to drop to 5.7%. Although the data continues to trend lower overall, it is a very choppy ride for the long term unemployed.

The vaccine rollouts continue to drive sentiment, but the Delta variant remains a significant concern. A surge of cases in the US and China spooked markets earlier in the week, but upticks in vaccination rates in some key US states calmed worries. Over 4.26 billion doses of vaccines have been administered globally but many low-income countries have less than 5% vaccination rates, and the death toll now exceeds 4.2 million.

This week FX volatility was evident again.  The USDIndex slipped to 91.75 and struggles to hold 92.00, and EURUSD tested up to 1.1900 before slipping back to 1.1850, while USDJPY declined as low as 108.85 before recovering to 109.20. Cable rallied to 1.3985, then cooled to 1.3850 but holds over 1.3900 ahead of the BOE on Thursday.

US stock markets posted more new all-time highs and continue to consolidate at highs on the back of the strong Q2 Earnings Season, which has over 88% of companies outperforming expectations. The USA500 holds over 4,400, the USA30 over 35,000 and the USA100 over 15,000.

The Gold price moved up this week as the USD remained pressured and US Treasuries in demand.  The price held over $1800, posting highs at $1832 and lows at $1806. The 20-day moving average is up to $1809.

USOil prices had a volatile week, as missile exchanges in the Gulf and tanker hijackings crept back into the news. A spike to $73.50 was followed by a quick dip to $68.60 before recovering the key $70.00 handle ahead of the EIA weekly inventories later today.

The yield on the US 10-Year Treasury Note remains very much in focus. A weekly low of 1.15% on Monday provided a weak support as the rate remains below 1.20% at 1.18%, just above the July low at 1.13% ahead of the NFP data on Friday.

    

Click here to access our Economic Calendar

Stuart Cowell 

Head Market Analyst

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

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What Joe Biden's bipartisan infrastructure deal means for cryptocurrency investors

The US unveiled a $1trn bipartisan infrastructure agreement this week, and cryptocurrency investors were able to win some last minute concessions.

Cryptocurrency exchanges were initially caught off guard last week by plans to partially fund US president Joe Biden’s bipartisan infrastructure agreement, which includes money for railways, roads and broadband access, by higher taxes on cryptocurrencies. 

The changes were expected to generate around $28bn in additional tax revenue over the first ten years, says Bloomberg. 

As expected, the proposals stirred an uproar in the crypto community. 

“Instead of rushing through an untested provision with vast unintended consequences, we encourage Congress to work with industry to find language that works for all stakeholders,” said Kristin Smith, head of the Blockchain Association. 

The bipartisan plan is the first part of Biden’s infrastructure agenda. It proposes $550m in new spending over five years above projected federal levels and is widely perceived as one of the most game-changing plans in the country’s history.

So what do the proposals now say on cryptocurrencies? 

The latest legislative text released this week omitted some of the terminology that had caused concern among crypto market watchers. 

Language that specifically mentioned decentralised exchanges or peer-to-peer marketplaces was omitted, to be replaced with a looser definition of brokers, meaning that decentralised peer-to-peer exchanges may not specifically be required to report transactions. 

Part of the reason that Biden is targeting crypto is to raise money to fund his eye-wateringly expensive infrastructure agenda. Another reason, however, is a desire to tackle the underreporting of bitcoin gains. As it stands, crypto exchanges do not have to report gains and losses incurred by customers, but this could change even with the more generous text. 

Nonetheless, the infrastructure agreement is still believed to have ramifications for the crypto market. 

What Biden’s plans mean for cryptocurrencies 

As Chris Etherington, private client tax partner at RSM UK, puts it, the main effect of the proposal is that it will force crypto exchanges to collate and share more data and “provide the IRS [Internal Revenue Service, the US tax authorities] with a much clearer picture of who should be paying tax on their crypto investments and the amounts due”. 

This means investors who use centralised exchanges such as Kraken and Coinbase should expect the IRS to gain a much clearer picture into the exact amounts they earn from trading crypto, analysts tell MarketWatch, and should also expect to pay higher taxes. 

The higher reporting requirements being proposed by the US could trigger tax authorities in other countries including the UK to follow suit, resulting in cryptocurrencies being treated by tax authorities in a similar way to the US Foreign Account Tax Compliance (FATCA), which requires non-US financial institutions to report to the US Treasury department details of and assets held by their customers with connections to the US, and the OECD’s Common Reporting Standards (CRS), which aims to prevent tax evasion by exchanging financial information between various countries’ tax authorities.

“The US is again using its size and influence to bring in these rules, and it will be interesting if other governments now follow, like they did with FATCA [ and CRS],” says Alex Straight, partner at law firm Blick tells Rothenberg. 

“These rules could set a precedent for other tax authorities like HM Revenue & Customs to make requests for similar information to be shared with them,” Etherington says. 

But it’s important that the tax regulation doesn’t act as a deterrent to investors. Such a scenario could mean tax authorities will eventually “shoot themselves in the foot” and get less tax revenues,” he adds. 

So is this a good thing or a bad thing for crypto?

The concessions in the newer text for the crypto market may be branded as a win for the industry, but still many hurdles exist. 

US senators will start debating the text this week, so there will no doubt be further changes to the text, both good and bad. 

The increased reporting requirements may result in higher taxes being paid on cryptocurrency gains and could eradicate a cloud of uncertainty and underreporting in the market. 

But it is worth noting that even with increased transparency, cryptocurrencies are still very much prone to regulatory upset. In May, China banned cryptocurrency mining in the country and prohibited Chinese financial institutions from participating in the sector. 

Yesterday, Gary Gensler, chair of the Securities Exchange Commission, the U financial regulator, branded cryptocurrencies as the “Wild West” and called for more reform. 

So keep an eye on how the final infrastructure deal pans out when it becomes law, but also on the many other headwinds looming over the crypto market.

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Market Spotlight: NZD Soars On Data Beat

New Zealand Employment Data Beats ExpectationsThe New Zealand Dollar is moving firmly higher today on the back of a strong set of employment releases overnight. The headline unemployment rate was seen falling back to 4% from the prior month’s 4.6% reading, well below the 4.4% figure projected. On a quarter basis, the employment change indicator recorded a 1% result, up from the prior month’s 0.6% and the 0.7% forecast. Additionally, the country’s labour cost index was seen rising 0.9% on the quarter, up from 0.4% last quarter and above the 0.7% forecast.This latest set of positive data has further fuelled expectations of an imminent rate hike from the bank. Following the RBNZ recently announcing that QE is set to end their monthly asset purchases from September, the market is now looking for the next step along the pathway to policy normalisation. With August 18th scheduled as the next policy review, NZD is likely to remain supported over the coming weeks.Technical ViewsNZDUSDThe rally in NZDUSD has seen price reversing higher off the .6933 floor. Price is now fast approaching the .7110 level, with the bear channel top sitting just above. This is will be a key challenge for bulls, with a break higher here opening the way for a run up to the .7315 level next, in line with bullish MACD and RSI.

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Bitcoin miners are cleaning up their act, using green energy to drive higher profits

• SEE MORE Bitcoin does consume a lot of energy – but here’s why it’s worth it

Today we consider the profit motive.

When it comes to coercion and “getting people to do the right thing” we argue that profit is a far more powerful incentive than government edict, and the outcomes are better.

We follow the Adam Smith argument, that self interest motivates what we do, yet that by acting in our own self-interest we promote the greater good. An individual may intend “only his own gain” but he is “led by an invisible hand to promote an end which was no part of his intention.”

To demonstrate this point we contrast Western governments’ Green Industrial Revolution with that most heinous of activities, bitcoin mining.

We have observed on these pages many times that Western governments’ grand plans for a Green Industrial Revolution are going to require extraordinary amounts of fossil fuel to be burnt in order to realise, especially to mine all the required metal.

What is the more environmentally friendly solution? To carry on driving the old banger, or to buy a new electric vehicle, with all the fossil fuel requirements there are in the manufacture of that vehicle, and in the creation of electricity to power it? I rather suspect the former.

We now park that thought, and turn to bitcoin mining, pilloried as wasteful and environmentally unfriendly. 

Bitcoin’s vast energy use is a feature, not a bug

Bitcoin’s “proof-of-work” system of verifying transactions on the blockchain means that extraordinary amounts of energy are required to power the network. Some estimates are that bitcoin’s annual energy demands are equivalent to those of the Netherlands with its 20 million people. 

In previous missives I’ve explained why this energy consumption is inherent to bitcoin, and how it is a feature, not a flaw. 

By the way, just because something consumes a lot of energy does not mean it is wasteful. Energy consumption is part of progress. After the Agricultural Revolution we started to use animals to labour for us, then, following the Industrial Revolution, machines. In today’s digital age, we consume more energy per capita than ever. As we progress we have found better means to provide that energy.

Bitcoin mining, as we all know, consumes lots of electricity. A bitcoin miner can, in theory, locate itself pretty much anywhere. It could locate itself in Mayfair or it could set up shop in the darkest reaches of the Amazon. Its chief concern is that energy is cheap. 

The cheapest energy in the world is energy that goes unused or is wasted, often stranded renewables in remote parts of the globe. If bitcoin miners can access that energy, they become more profitable. Location does not matter; that energy can be anywhere, and bitcoin mining is constantly seeking it out. 

Let me give you some recent examples.

The first relates to gas flaring. This is the practice in the oil and gas industry of burning off the huge quantities of natural gas that rise to the surface as oil is extracted from wells. That gas is often uneconomic to pipe to market and so, to dispose of it, it is flared. 

Some $20bn worth of gas is flared every year – as much CO2 and other greenhouse gases are released into the atmosphere as a result as from the use of 200 million cars: 150 billion cubic metres of gas. It’s an extraordinarily wasteful and polluting practice. The World Bank has attempted to impose initiatives to eradicate it, but it continues. 

If only the oil and gas industry could find a way to turn that gas to profit, then much of the waste and environmental harm could be averted. Enter bitcoin.

Bitcoin mining uses energy that would otherwise go to waste

One company, Great American Mining, has found a means to deliver portable bitcoin mining machines, in great crates, to oil and gas fields. That energy from that gas is now used to power bitcoin mining operations.

In July, another start up, Compass Mining, signed a 20-year deal with nuclear fission company Oklo, which builds microreactors. The deal enables Compass to use all the excess energy from Oklo’s microreactors. The partnership is a “beacon” for the intersection of cryptocurrency and clean-energy development, says Oklo CEO Jacob DeWitte. Bitcoin mining generally is making use of unwanted land close to nuclear power stations, especially in France.

Also in July, payments company Square, founded by Jack Dorsey of Twitter, announced that it is funding a solar-powered bitcoin mining facility with Blockstream

El Salvador hit the headlines in June when it became the first nation to authorise bitcoin as legal tender. Within hours of the announcement El Salvador’s president, Nayib Bukele, was outlining plans for bitcoin mining rigs “with very cheap, 100% clean, 100% renewable, zero emissions energy from our volcanos.” 

Around 8% of all bitcoins have been mined in Iceland, where hydroelectric and geothermal account for almost all of the power generation. 

The extraordinary energy that bitcoin requires to power its network is powering an energy revolution that is happening in real time around us now. The motive is profit. 

And we hark back to Adam Smith. “Every individual”, he said, “neither intends to promote the public interest, nor knows how much he is promoting it... he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.”

That very dynamic is at work with bitcoin’s vast energy demands.

The Bitcoin Mining Council, which was set up in May in reaction to criticism about bitcoin’s energy consumption, especially from Elon Musk, found in its first report that over 50% of bitcoin’s energy comes from sustainables. Research by investment house CoinShares estimated that the number is much higher: 74% of bitcoin mining is powered by renewables, it said. 

Bitcoin gets singled out for criticism. No other industry receives as much scrutiny, but in fact it is making better use of wasted or renewable energy sources than almost any other large-scale industry in the world.

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JPMorgan Blames Turkey’s Volatile Lira for Investor Misgivings

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Market Spotlight: Trading US ADP Employment

US ADP Up NextThe main data focus for today’s US session will be the ADP employment figure. With the reading often used as proxy for gauging the NFP release to follow, today’s data holds the potential to create plenty of market volatility if we see any significant surprise.Consensus forecasts for the release are focusing on the 695k figure, which would mark an uptick from the prior 692k reading. However, given that USD has fallen from favour recently, it would likely take a very strong reading to cause an upside shift ahead of the NFP release on Friday.Where to Trade the Release?GBPUSDFollowing the downside break of 1.3676, the pair has since reversed sharply and is now close to seeing a breakout above the 1.3997 level. This has been a key level for the pair this year and a move back above the level would be a firm bullish development. With MACD and RSI supporting, any USD weakness today could see the pair back above 1.3997, putting the focus on 1.4248 as an initial target.

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What Can We Expect on the ADP Report Today? Medium-Term Analysis of NZUSD

The NZD rose nearly half a percent against greenback after data released Wednesday showed that New Zealand's unemployment rate returned to the record low level that it was at before the virus outbreak. The share of unemployed fell from 4.6% to 4.0% in July, well ahead of the modestly positive forecast of 4.4%. Wage growth rate advanced to the highest level in 13 years, which indicates a strong increase in pro-inflationary risks and likely to prompt a hawkish intervention of the Central Bank. The RBNZ is expected to raise the rate at the upcoming meeting, however, the upside potential of the NZD is far from being exhausted. Especially as there is a risk of a large rate hike by 50 bp at once, as well as the risk that the Central Bank will not rule out the possibility of more rate hikes, which could form sustainable bullish sentiment on the NZD.From the point of view of technical analysis, the bullish scenario for the NZD can be supported by the following observations. On the weekly NZDUSD chart, we can see a wedge pattern; the formation of which began at the end of last year and continues today. The wedge has a negative slope relative to the main bullish trend, therefore it can be considered as a trend continuation formation. On a larger scale, the idea of a trend continuation looks even more plausible because the multi-year peaks are still far away:In the past few weeks, NZDUSD has been indecisive, which can be concluded from the shape of weekly candlesticks that had long tails and small bottoms - intra-week fluctuations were characterized by both up and down movements with a slight advantage for sellers:The bounce from the lower bound of the pattern two weeks ago and expectations regarding RBNZ decision which warrant sustainable upside sentiment suggest that bulls may venture a test of the upper bound of the pattern in the area of 0.7150-0.7170 in the coming weeks.On Wednesday, the dollar is trying to maintain the edge ahead of release of the first batch of labor market data for July - ADP report and ISM report on activity in the services sector. The situation in the manufacturing sector, as shown by a series of data earlier this week (ISM, factory orders, equipment spending) suggests contribution of the sector to the growth of payrolls in July likely beat forecast. However, the share of employed in mfg. sector in the total employment is relatively small, so the ISM report in non-manufacturing sector is much more important in preparing for the NFP. Employment in services sector is now highly subject to fluctuations induced by swings in consumer mobility and social restrictions. Let’s be careful here, since it was in July that the incidence of Covid-19 began to rise in the United States:Correlation of covid daily cases growth with severity social restrictions is gradually weakening, but this process is slow, so rising incidence in the US in July could still have a drag on creation of jobs due to the pressure on services sector. A negative surprise in ADP and ISM is likely to trigger a wave of dollar sales as it would become more difficult to expect a strong NFP, which is the key report for predicting the Fed's policy move in August.

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Working from home? Make sure you claim everything you can

Hundreds of thousands of Britons are self-isolating after being pinged by the NHS Covid-19 app. One silver lining is that those who are working from home (WFH) could be in line to claim up to £140 of tax relief. 

Employees have always been allowed to claim back a tax rebate for costs such as higher heating and telephone bills if they are required by their employer to work from home. Claiming used to be a slightly fiddly process that required a P87 form. But stop-start lockdowns have forced the government to simplify the procedure to forestall administrative headaches. 

Last October, HMRC launched a specialised microservice that enables taxpayers to claim relief in minutes without submitting evidence of higher bills. It can be accessed via www.gov.uk/tax-relief-for-employees/working-at-home. You will need a government gateway ID to use the service. The portal updates your PAYE tax code so that your employer deducts less tax from your salary each month. 

The relief you can claim on without providing evidence of your extra costs is £6 a week. A few companies have already paid it as a tax-free allowance to employees to cover WFH expenses, but as times are hard most have opted not to. If the latter applies to you then you can claim relief on the extra costs you have incurred. Standard-rate taxpayers are eligible for a rebate of £1.20 per week (20% of £6), making £62.40 per year. For higher-rate payers the annual relief is worth £124.80 per year, while additional-rate payers get £140.40. Over two years that means it is possible to receive as much as £280 in relief.  

For the 2020-2021 and 2021-2022 tax years it is possible to claim relief for the whole year even if you did not work from home every week. Those who work from home for part of the week are also eligible. 

You must have been required to work from home; you are not eligible if you chose to do so. You must also declare that your costs have increased as a result (they almost certainly will have owing to higher energy and water consumption). This is an individual benefit, so couples and flatmates can each make a claim provided they meet the criteria. 

Remember to claim again 

If you do self-assessment then you are still eligible for the full-year rebate, but cannot claim via the portal: instead you must make the claim when you next fill in your return. Self-employed people are not affected as they already claim for work-related expenses when they do self-assessment. It is possible to backdate a claim by up to four years if you haven’t already made one (note that the weekly flat rate before April 6 2020 was £4). HMRC has already received more than three  million claims for the 2020/2021 tax year. If you have already claimed for last year, remember to do so again for the current tax year (which began on 6 April) if you qualify. 

Data from the Office for National Statistics shows that 38% of working adults were working from home at least part of the time in late April 2021, but only about 800,000 people have so far claimed for the current year. 

If you have incurred significantly more than £6 a week in extra costs it is worth claiming for those too, but you will have to go through the more burdensome process of filling in a P87 form and providing receipts to prove it. Note that if you are an employee then only variable costs are counted; you cannot include a contribution towards rent or mortgage payments. 

from Moneyweek RSS Feed https://moneyweek.com/personal-finance/tax/603626/working-from-home-make-sure-you-claim-everything-you-can
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Market Spotlight: EURUSD Breakout Update

EURUSD Breakout In PlayThe EURUSD breakout trade from the 1.1840 level is still in play here. Following the initial breakout above the level, momentum has waned on approach to the bearish trend line. However, with MACD and RSI both bullish still, the focus is on a continuation higher while the market sits atop 1.1840, keeping 1.1961 in sight as the initial target.Key Data to WatchToday’s US services PMI and APD employment numbers will be the key releases to watch. While both readings are expected to mark an improvement on the prior month, there is room for disappointment, should either release underwhelm forecasts. The headline focus, however, will be on the US labour reports due on Friday. Once again, if there is any disappointment with Friday’s data this will create for further upside in the pair.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/market-spotlight-eurusd-breakout-update"
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Earnings report Aug. 5: Moderna and Siemens

Moderna, Inc. ( #Moderna ), one of the first companies to produce the mRNA vaccine approved for emergency use, was one of the first companies to produce a Covid-19 vaccine. The company’s vaccine has already been administered to millions, and. it has contracts to supply hundreds of millions more doses  to countries around the world. The company is expected to report its quarterly results ending June 2021 on August 5, before the market opens.

The Zacks forecast  expects Moderna’s sales in the latest quarter at $4.29 billion, higher than the same quarter a year ago, with sales of just $66.35 million, representing a jump of more than 6368.43%. The quarter’s return on equity is expected to be $6.01,  2,038.71% higher than the prior-year quarter ($-0.31 per share).

Vaccinations had begun to slow down in major economies, but as a result of the return of the outbreak of the Delta variant, demand for effective boosters continues. According to the Financial Times, both Moderna and Pfizer have agreed to deliver 2.1 billion doses of the vaccine through 2023 to the EU. After the three phase trials, Moderna and Pfizer were found to be more efficient, and so although Oxford/AstraZeneca and Johnson & Johnson are cheaper, Moderna’s higher demand meant they was able to raise the EU dosing price from $22.60 to $25.50, but below the $28.50 previously. Moderna is estimated to have made $30 billion in vaccine sales.

Meanwhile, the EU aims to vaccinate at least 70% of the adult population by the end of September. Israel will begin offering a third shot to those over the age of 60 who are already vaccinated against COVID-19 on Sunday, while UK will start next month.

Since the beginning of the year, Moderna’s share price has risen  231.78% with a new all-time high yesterday above 365.00, before dropping to close at 346.94.  Meanwhile the Day time frame sees RSI in the overbought zone and moving down. While smaller timeframes like H1 and H4 show a bearish divergence, that means prices may have been shortened prior to the earnings report date. If the report is not good, there may be a continued decline, with an important support line at the 300.00 psychological zone.

Siemens AG ( #Siemens ) is a German industrial giant – one of the largest in Europe – and is another company scheduled to report second-quarter earnings on Thursday before the market opens. The Zacks sales forecast for the quarter is $17.98 billion higher than the $14.85 billion in the same quarter of the previous year. It represents a growth rate of 33.87%, while the return per share is expected to be $0.83, above the $0.62 the prior year quarter.

Bloomberg reported in June that Siemens had announced a 3 billion euro ($3.6 billion) share buyback plan running from next year to 2026. The company also said it was targeting an acquisition to enter a new market, having agreed to pay $700 million to acquire American company SupplyFrame Inc., a digital platform company specializing in connecting companies throughout the electronic supply chain. This will help customers reduce costs, increase mobility and make wise decisions. An agreement is expected to be reached later this year.

Siemens‘ share price has fallen from the year’s highs following May’s second-quarter earnings report and bounced at the 200-day SMA line at the end of July. This week the price could rise above the bearish channel and the 50-day SMA line again if the price is able to support above the 50-day SMA and the earnings are good. There will be the first target at 139.00 and the next one in the year’s high at 145.00, while if earnings are bad there will be key support at the 200-day SMA at 129.00 and the next one at the latest low at 125.00.

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Chayut Vachirathanakit
Market Analyst – HF Educational Office – Thailand

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