MEXICO: United Mexican States (MEX; Baa2neg/BBB/BBB-) Finance Minister Resigns
“Rogelio Ramírez de la O resigns from the Treasury Department” – El Universal
Neutral for spreads
• Resignation of the Finance Minister was expected. Ramirez was Andres Manuel Obrador’s (AMLO) appointment in 2021 and agreed to stay on through February 2025.
• Luz Elena González, head of Energy or Edgar Amador current undersecretary of the department are expected to replace him.
• President Sheinbaum and the Morena party are in control of the government so we would expect no change in policy or implementation by the replacement.
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US STOCKS: Late Equities Roundup: Near Session Highs, IT & Pharmaceuticals Ahead
- Stocks continue to extend gains/pare losses, the Nasdaq mildly underperforming in late Wednesday trade. Currently, the DJIA trades up 250.53 points (0.56%) at 44807.48, S&P E-Minis up 14 points (0.23%) at 6077, Nasdaq down 8 points (0%) at 19646.43.
- Information Technology and Health Care sectors continued to lead gainers in late trade: Johnson Controls International gaining over 12.25% after beating earnings estimates (and replacing it's CEO) this morning, while Fiserv Inc gained 7.45%, Super Micro Computer +6.79% and Broadcom +6.21%.
- Better than expected earnings also helped pharmaceuticals with Amgen +6.23%, Bio-Techne gaining 4.8% and Regeneron Pharmaceuticals +2.77%.
- Communication Services and Consumer Discretionary sectors continued to underperform in late trade, interactive media and entertainment shares weighing on the former with Alphabet -8.08% after beating street estimates in 4Q EPS, but missing 4Q revenue, Match Group -7.62%, Interpublic Group -3.99%.
- Leading laggers in the Consumer Discretionary sector included Tesla -3.22%, Chipotle Mexican Grill -2.69%, Nike -2.46 and Amazon -2.3%.
- Reminder, earnings expected after the bell include: MetLife, Cognizant Technology Solutions, MicroStrategy, QUALCOMM Inc, Skyworks Solutions, McKesson Corp, Molina Healthcare, Viking Therapeutics, Ford Motor Co, Allstate Corp and O'Reilly Automotive Inc.
COMMODITIES: Gold Extends Gains, Copper Outlook Remains Bullish, WTI Falls
- Gold rose to a fresh record high earlier in Wednesday’s session before paring gains, with the yellow metal currently up by 0.9% at $2,868/oz.
- Earlier in the session, gold reached a high of $2,882 on the back of a further pullback in the US dollar and continued haven demand amid ongoing geopolitical and tariff uncertainty.
- With a bull cycle in gold still in play, sights are on $2,889.9 next, a Fibonacci projection, followed by round number resistance at the $2,900 level.
- Meanwhile, copper has also rallied by 2.3% today to $445/lb, taking the red metal to its highest level since Jan 17.
- Copper remains in a bull cycle, with gains this week taking it through $433.50, the Dec 12 high. The break of this level highlights a reversal and opens $452.85, the Nov 5 ‘24 high and a key resistance.
- Next resistance above here is $469.30, the Oct 3 high.
- Crude has extended earlier losses following a large US crude stocks build and with pressure from signs of increasing global trade friction.
- WTI Mar 25 is down by 2.2% at $71.1/bbl.
- According to the EIA weekly US petroleum summary, crude stocks rose by 8,664mn w/w vs. an expected +1,034mn
- WTI futures have pierced support around the 50-day EMA, at $72.27, a clear break of which would open $68.05, the Dec 20 low.
USDJPY TECHS: Bear Cycle Extends
- RES 4: 158.87 High Jan 10 and the bull trigger
- RES 3: 158.08 High Jan 15
- RES 2: 156.75 High Jan 23 and a key resistance
- RES 1: 155.59 20-day EMA
- PRICE: 152.17 @ 16:06 GMT Feb 5
- SUP 1: 152.12 Low Feb 5
- SUP 2: 151.81 Low Dec 12
- SUP 3: 151.72 2.0% 10-dma envelope
- SUP 4: 151.06 76.4% retracement of the Dec 3 - Jan 10 bull leg
USDJPY traded lower again Wednesday, resulting in a break of key short-term support at both 153.72, the Jan 27 low, as well as 152.55, a Fibonacci retracement. This expands the downside range, with the pair narrowing the proximity with the December low. 151.06 marks the next key level. On the upside, initial firm resistance is seen at 155.59, the 20-day EMA. Key short-term resistance has been defined at 156.75, the Jan 23 high, where a break would highlight a bullish reversal.
