RPT-GRAPHIC-Take Five: Trade at the Ruins of Technology – World Market Themes for the Week to Come

(Repeat the story of Friday, update the Brexit)

November 23 (Reuters) – Five major themes that may dominate the thinking of investors and traders over the coming week as well as Reuters articles about them. 1 / THE LAND (EDF) The Federal Reserve will be in the limelight this week. A report of the Fed's November meeting will appear and ten Fed committee members, including President Jerome Powell, will speak at an event on Wednesday. Their speeches will be useful to investors who have reiterated their expectations for future rate hikes, after taking note of the cautious tone taken in the comments of policymakers lately.

Powell himself mentioned the slowdown in growth abroad as a source of concern, along with lower tax cuts, slowing housing markets, and a lack of confidence. unstable corporate credit.

However, it did not counter expectations of a rate hike in December, which remains the baseline scenario. But, as other members of the FOMC committee warn against the headwinds, a real gap is emerging between the markets and the Fed in terms of the interest rate level at the end of 2019 and the horizon 2020.

While the projection of the FOMC median target rate for end 2019 is 3.125%, the target rate suggested by the January 2020 federal funds futures contract is 2.75%. And this is down 2.95% two weeks ago.

Futures are no longer forecasting rate hikes from there, although the FOMC has forecast 3.375% by the end of 2020, a gap of about two rate hikes. – Fed's Powell: "Very strong" in the United States, even in housing, other risks – The rush to the sugar economy and the Fed: a dilemma of rising rates

2 / BUENOS AIRES HEADS Trade war skirmishes have been common this year between Beijing and Washington, and Asian markets – innocent bystanders of this conflict – hope that Presidents Donald Trump and Xi Jinping will be able to negotiate any ceasefire. at the G20 summit in Buenos Aires.

Asian economies are slowing as this tariff war disrupts supply chains; Chinese factories in Japan and South Korea report lower orders. Even in Vietnam, the preferred destination for manufacturers looking to escape a low beam, the business climate is not at its peak. Meanwhile, India, Indonesia and the Philippines have not yet benefited from the 25% drop in oil prices last month.

Investors are clearly reluctant to hold risky assets before the G20. The pre-summit comments do not suggest an imminent rapprochement, but Buenos Aires may be the last chance. If negotiations fail, China and Asia will face a more difficult period. – APEC fails to live up to its name against US acrimony – GDP growth in Singapore's Q3 is well below expectations, trade frictions are shaking up prospects – Economic openness China to help offset trade frictions in US – bank advisor 3 Slow growth, weak business climate, political instability: it's hard to imagine a worse time for the European Central Bank to end its 2 billion euros, but that's what it plans to do by the end of December.

Eurozone inflation figures expected on Friday could add to data suggesting that the ECB will have some work to do as it tries to "normalize" its policy. The inflation indicator expected by the market fell to its lowest level in a year after business surveys showed slower than expected growth in November. Bets on a rise in ECB rates in December 2019 have calmed down again.

Investors expect inflation to rise to 2.1% in November, but "core" inflation, excluding food and energy costs, stands at 1.3%.

Could the ECB offer relief? An idea that has resurfaced, although apparently without foundation, is the possible resumption of another crisis-era measure, the Targeted Long-Term Refinancing Operation (TLTRO), which offers multi-year loans to investors. banks.

The chief economist of the ECB has already deterred such speculation. But the very possibility that TLTROs are released helped fuel an Italian bond rally. The markets will therefore closely examine the speeches of the ECB's decision-makers. Any reference to this could undeniably have repercussions on the European markets.

– Business growth in the euro area is much weaker than expected in November – The ECB rate increase forecasts and the stock market index decline after the decline in the euro area. Purchasing Managers Index – ECB Chief Economist Eliminates Hope of an Imminent Cash Injection for Banks

4) / THE BATTLE OF BREXIT AT HOME Even though British Prime Minister Theresa May obtained her agreement to withdraw Brexit from the EU on Sunday, her battle is just beginning.

The markets are counting on a parliamentary vote in early December on the agreement, which is a real critical date, and parliamentary arithmetic seems discouraging for the British prime minister. From here, she will have to embark on a charming offensive to seduce detractors of the agreement, whether it be from conservative party colleagues or opposition politicians. , business or public.

A lost vote for the government could wreak havoc on the financial markets as investors panic that Britain is heading for a messy and potentially damaging EU outflow in March.

Sterling has remained relatively quiet despite some fluctuations in recent days, but could change next week as the strength of opposition to its plan becomes clearer.

– EU struggles to agree on Gibraltar ahead of Brexit summit – Britain approves draft agreement on future relations

5 / TECH WRECK The difficulties in the technology sector are well known now, but some figures are still remarkable: the Nasdaq has fallen by 15% since the beginning of October; the FANG + TM index in a bear market; up to $ 1 trillion of the "FAANG" market capitalization lost in less than two months and the iPhone maker Apple loses a quarter of its value in a few weeks.

The question now is whether technology is bouncing back, closing the year on a high level and lagging behind the stock markets. The sector has been a leading indicator for the wider market – and to a large extent for the economy – downward. A rebound would help dispel fears that the US economy is about to reverse.

But the damage was serious. Most of the leading technology stocks and indices are well below long-term moving averages, indicating additional weakness. Trade wars continue to simmer. Finally, despite all the declines, the sector remains the most "congested" trade for the tenth consecutive month, reveals the BAML survey of fund managers.