Standard Chartered share price has been in the red for two consecutive days ahead of key inflation data and Q2 earnings season. At the time of writing, the STAN stock price was trading 1.70% lower at 657p. The British banking stock has been in a freefall for the past few weeks, crashing nearly 2% in the past month and more than 5% in the past week.
Inflation Data and Earnings Ahead
European stock markets were mixed on Tuesday, with UK’s premier FTSE 100 index down by nearly 0.50% as investors shifted their focus to the key US inflation data. Banking stocks led the losses in the index, with Standard Chartered share price as the worst performer. British banking bigwigs, including Lloyds Banking Group, NatWest Group, and HSBC, were also trading lower.
Investors around the world are looking ahead to the US Consumer Price Index (CPI) report for June, set to be published before Wall Street opens on Wednesday. The CPI data, which is used as the key inflation data, will indicate whether inflation has dropped and will help in shaping the Federal Reserve’s monetary policy decisions. Analysts anticipate a 0.3% growth in the monthly inflation in June, up from 0.1% in May.
The Office for National Statistics revealed on Tuesday, that the UK wage growth hit a joint-record high in the three months to the end of May, deepening concerns about entrenched inflation. Wages excluding bonuses in the UK grew by 7.3% from the same period last year.
The Bank of England has reiterated that high wage growth has remained a significant impediment to its effort to lower the persistently high inflation. As such, today’s figures will leave the central bank convinced that the monetary policy needs to be tightened further. According to the CME FedWatch Tool, traders are pricing in a 92% chance of the Federal Reserve hiking its rate by a 25-basis point this year.
The second-quarter earnings season is slated to kick off in earnest later this week. Financial bigwigs, such as BlackRock, Wells Fargo, Citi, and JP Morgan Chase, are all due to report their trading updates this week. Standard Chartered is slated to announce its earnings report later this month on July 28th.
Standard Chartered Share Price Analysis
The daily chart shows that the Standard Chartered share price has been hovering slightly above the important bullish support level of 654p for the past few days. The stock has dropped slightly below the 25-day and 50-day exponential moving averages.
Consequently, the Standard Chartered share price is likely to pull back further in the immediate term ahead of a bullish price reversal. If this happens, the next resistance level to watch will be 684.4p. On the flip side, further downswing, below the support at 654p will have sellers eyeing the next support level at 633p.
