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Fundamental News And Technical Analysis Report – 27 January 2023
BOJ USES THE FUNDS-SUPPLY WEAPON ONCE MORE AS YIELDS BEGIN TO RISE.
Asian stock market closes in green on Thursday. The Shanghai Composite is up 0.76% at 3264.81. Overall, the Singapore MSCI is up 0.68% at 308.52. Over in Hong Kong, the Hang Seng Index is up 2.37% at 22566.78. In Japan, the Nikkei 225 is down 0.12 at 27362.75. While the Topix index is down 0.12% at 1978.40, South Korea’s Kospi is up 1.65% at 2468.65. Australia S&P/ASX 200 down 0.30% at 7468.30.TOP NEWS OF THE DAY: –
The Bank of Japan said on Friday it will extend five-year loans against collateral to financial institutions, the second time it has made such an offer after ramping up the funds-supply operation this month to defend its yield control policy.The announcement underscores the central bank’s resolve to prevent simmering market speculation of a near-term interest rate hike from pushing up bond yields too much.
The BOJ will conduct the funds-supply operation on Tuesday, under which it will offer loans with a five-year duration from Feb. 1, it said in a statement.
The amount of loans to be offered will be announced on Tuesday, it added.
The announcement came after the 10-year Japanese government bond (JGB) yield crept up near the BOJ’s 0.5% cap on Friday, partly on data showing core consumer inflation in the capital Tokyo hit a near 42-year high of 4.3% in January.
In the previous offer made on Monday, the BOJ extended five-year loans worth 3.13 trillion yen ($24.09 billion). The minimum bid interest rate was 0.110%.
At this month’s policy meeting, the BOJ amended rules for the funds-supply operation, so it can pump funds extending up to 10 years to financial institutions against collateral.
Market Summary as per 26/01/2023:
European equities Thursday closing. The DAX futures contract in Germany traded up 0.34% at 15132.85, CAC 40 futures up 0.74% at 7095.99. UK 100 futures contract in the U.K. up 0.21 at 7761.11
In the U.S. on Wall Street, the Dow Jones Industrial Average Closed up 0.61% at 33949.41. The S&P 500 up 1.10% at 4060.43 and the Nasdaq 100 up 1.76% at 11512.41, NYSE 0.61% closes at 15985.87.
TECHNICAL SUMMARY
GBPUSD TECHNICAL ANALYSIS
TRADE SUGGESTION – BUY AT 1.24245, TAKE PROFIT AT 1.24800, SL AT 1.23571