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Below is the daily global market update 27 October 2021 By Team Kristal.AI

Tech Earnings don't disappoint

Not much activity outside of Earnings in the overnight session as we heard from the likes of Alphabet, Microsoft and Twitter. Sales and profit continued to outperform expectations despite the decline in ad spend flagged by Snap and Facebook. In Twitter's case there seemed to be little impact from Apple's recent move on privacy restrictions (users now have to opt-in to be tracked). SPX overall also traded just shy of the 4600 level before falling back. While 9 out of 11 sectors were in the green, 55% of the constituents were lower on the day (indicating a top heavy rally) with volume in the 40th percentile of its 1Y range.

The Nikkei saw a 1.7% gain yesterday to reverse some of the recent decline and the JPY sold off as risk sentiment appeared to improve. The AUD has traded up this morning as well after Q3 inflation came in higher than expectations on the trend measures. The US dollar overall was marginally stronger with vol selling off across Equity and FX. Yield curves continued to flatten with the US 2Y now almost at 50 bps (from 12 bps at the start of the year). Inflation expectations remain as strong as ever with the 5Y breakeven yield just shy of 3%.

Commodities were mixed as Crude continued to trade up but Metals sold off. The Brent-WTI spread dipped to below USD 2 per bbl now and Gold was unable to sustain its prior session run above the 1800 level. Bitcoin tested the 60k support level once again but Ethereum closed in the green with a 2% gain. Ahead today, we have a rate decision in Canada (where a hawkish hold is expected) to go along with the Earnings calls.”

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