Market Talk – 28 July 2022

Asia:

Bloomberg reports that an iPhone manufacturing plant in the southern Chinese city of Shenzhen has been forced by Chinese authorities, along with 100 other companies, to shut down a “closed loop” for seven days to curb COVID-19 infections. A “closed-loop” system would mean that only employees living on site could work, preventing outside access and largely preventing anyone from leaving the factory. The timing of the shutdown is also worrisome, as Foxconn is expected to begin mass production of the upcoming iPhone 14 series in a few weeks, before the September launch. In 2020, amid lockdowns and widespread uncertainty, Apple was forced to postpone the launch of its iPhone 12 to October, a one-month delay due to supply chain issues.

The International Monetary Fund (IMF) on Tuesday cut India’s growth forecast for 2022-23 (Fiscal Year 23) by 80 basis points to 7.4 percent, citing less favorable external conditions and rapid policy tightening by the central bank. In its April Global Economic Outlook update, the International Monetary Fund said that although a global recession is ruled out in 2022 with a growth forecast of 3.2 percent, the balance of risks is headed straight to the downside, driven by a wide range of factors that could negatively impact on the global economy. performance of the global economy. The International Monetary Fund’s downward revision of India’s growth forecast came days after the Asian Development Bank cut its growth forecast for India to 7.2 percent for FY23 from 7.5 percent due to higher-than-expected inflation since April and the subsequent tightening of monetary policy by the Reserve Bank of India. (RBI).

The major Asian stock markets had a mixed day today:

  • The NIKKEI 225 increased 99.73 points, or 0.36%, to 27,815.48 points
  • The Shanghai index rose 6.82 points, or 0.21%, to 3,282.58 points
  • Hang Seng fell 47.36 points, or -0.23%, to 20,622.68
  • The ASX 200 rose 66.50 points, or 0.97%, to 6,889.70
  • The Kospi added 19.74 points, or 0.82%, to 2,435.27
  • The SENSEX Index rose 1041.47 points, or 1.87%, to 56,857.79 points
  • Nifty50 rose by 287.80 points or 1.73% to 16,929.60

The major Asian currency markets had a mixed day today:

  • AUDUSD fell 0.00356 or -0.51% to 0.69646
  • NZDUSD rose 0.00107 or 0.17% to 0.62717
  • USDJPY fell 1.705 or -1.25% to 134.450
  • USDCNY 0.00592, or 0.09%, rose to 6.74832

Precious metals:

Gold rose by $20.09/ton ounce. or 1.16% to 1,752.63

– The price of silver increased by 0.776 US dollars / ton. Ounces or 4.06% to 19.870

Some economic news from last night:

Japan:

Foreign bond purchases increased from -910.2 billion to 107.9 billion

Foreign investment in Japanese stocks decreased from 475.0 billion to 298.1 billion

South Korea:

BSI Manufacturing Index (August) fell from 82 to 80

Australia:

Export Price Index (Quarterly) (Second Quarter) decreased from 14.6% to 10.1%

The Import Price Index (Quarterly) (Q2) decreased from 5.1% to 4.3%

Retail Sales (MoM) (June) decreased 0.9% to 0.2%

New Zealand:

ANZ Business Confidence Index (July) increased from -62.6 to -56.7

Activity on the Bank of New Zealand (July) increased from -9.1% to -8.7%

Some economic news of the day:

India:

M3 money supply decreased from 8.9% to 7.9%

Europe/Europe, Middle East and Africa:

The Federal Reserve raised interest rates by 0.75 percentage points for the second month in a row in the most severe tightening since the 1980s, increasing pressure on the Bank of England to clamp down hard on rising rates. The Fed’s moves will infuriate the Bank of England as it faces mounting pressure from Conservative Party MPs to tackle inflation as the election to choose the party’s next leader begins. The bank is considering a 0.5 percentage point hike before next week’s meeting, which would be the largest rate hike in nearly three decades. The two potential contenders for the position of British Prime Minister also exchanged views on raising interest rates ahead of the elections. Liz Truss has called for a review of the bank’s mandate, while Rishi Sunak has warned that tax cuts for his Tory leadership rival could exacerbate inflation and push rates higher.

Politician and financial hawk Robert Holzmann said Sunday that the European Central Bank will look at the economic situation before deciding whether to go ahead with another rate hike in September. He added that the ECB was also trying to prevent expectations of higher inflation from taking hold among the general public. The European Central Bank raised its key deposit rate by 50 basis points to zero on Thursday, the first increase in 11 years, as it joined global rivals in raising borrowing costs.

Major European stock markets had a mixed day:

The CAC 40 rose 81.27 points, or 1.30%, to 6,339.21 points

The FTSE 100 fell -2.98 points, or -0.04%, to 7,345.25

The DAX 30 Index rose 115.73 points, or 0.88%, to 13,282.11

The major European currency markets had a negative day today:

  • EURUSD fell 0.00469 or -0.46% to 1.01563
  • GBPUSD fell 0.00296 or -0.24% to 1.21363
  • USDCHF fell 0.00327 or -0.34% to 0.95643

Some economic news from Europe today:

France:

French PPI (MoM) (June) increased from -0.3% to 1.3%

Spain:

Spanish Retail Sales (YoY) (June) down 1.3% to 1.0%

Spanish unemployment rate (second quarter) decreased from 13.65% to 12.48%

Spanish business confidence fell from 2.3 to -5.2

Italia:

Italian Industrial Sales (YoY) (May) increased from 22.00% to 23.60%

Italian Industrial Sales (MoM) (May) decreased from 2.80% to 1.40%

Italy’s non-EU trade balance (June) decreased from -0.26 billion to -2.82 billion

Germany:

German CPI (YoY) (July) fell from 7.6% to 7.5%

German CPI (MoM) (July) increased from 0.1% to 0.9%

German HICP (YoY) (July) increased from 8.2% to 8.5%

German HICP (MoM) (July) increased from -0.1% to 0.8%

Euro-zone :

Business and Consumer Survey (July) fell from 103.5 to 99.0

Business climate (July) decreased from 1.45 to 1.14

Consumer Confidence (July) fell from -23.8 to -27.0

Consumer Inflation Index (July) increased from 42.6 to 42.8

Selling price forecast (July) decreased from 50.1 to 45.1

Services confidence (July) decreased from 14.1 to 10.7

Industrial Confidence (July) fell from 7.0 to 3.5

United States / America:

Gross domestic product declined for the second consecutive quarter in America. This is seen as a warning sign of a recession, but the White House changed the definition of “recession” earlier in the week. Analysts had expected a 0.3% gain in GPD after a first-quarter contraction of -1.6%. However, economic growth slipped -0.9% during the second quarter.

Initial jobless claims in the US rose last week by 5,000 to 256,000, according to the Labor Department. The previous week’s level was revised upwards by 10,000 to 261,000 from 251,000. The four-week moving average is now at 249,000, an increase of 6,250 over the average calculated for the previous week.

US market closing:

  • Dow Jones advanced 332.04 points, or 1.03%, to 32529.63
  • The S&P 500 advances 48.78 points, or 1.21%, to 4,072.39
  • Nasdaq advances 130.17 points, or 1.08%, to 12,162.59
  • Russell 2000 advanced 24.69 points or 1.34% to 1873.03

Canada market closing:

  • TSX Composite advances 202.15 points or 1.05% to 19456.71
  • TSX 60 advanced 9.92 points, or 0.85%, to 1,175.35

Brazil market closing:

  • Bovespa advanced 1158.7 points or 1.14% to 102596.66 points

energy:

Oil markets had a mixed day today:

  • Crude Oil is down $0.74/BBL or -0.76% to 96.482
  • Brent rose $0.12/BBL or 0.11% to 106.958
  • Natural gas fell $0.479/MMBtu or -5.51% to 8.1993
  • Gasoline fell $0.0623/gal, or -1.82%, to 3.3597
  • Heating oil fell $0.0753/gallon or -2.03% to 3.6347

The above data was collected around 13:37 EST on Thursday

  • Top Commodity Gainers: Silver (4.06%), Palm Oil (3.42%), Canola (3.97%) and Zinc (4.15%)
  • The biggest losers in commodities: heating oil (-2.03%), gasoline (-1.82%), wood (-3.58%) and natural gas (-5.51%).

The above data was collected at around 13:48 EST on Thursday.

Bonds:

Japan 0.204% (+0.1 basis points), US 2 with 2.89% (-0.082%), US 10 with 2.6777% (-5.43 basis points); US 30 3.00% (-0.004%), Bond 0.8120% (-12.6 basis points), France 1.3840% (-15.3 basis points), Italy 3.250% (-17.6 basis points), Turkey 17.18% (-19 basis points) , Greece 2.923% (-11.4 basis points), Portugal 1.905% (-16.3 basis points); Spain 1.972% (-18.1 basis points) and the United Kingdom 1.8660% (-9.4 basis points).

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Market Talk – 29 July 2022 »

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