Market Talk – August 4, 2022

Asia:

A special survey showed that growth in India’s dominant services sector slowed sharply in July, weighed down by high inflationary pressures and weak demand, further denting business expectations. The S&P Global India Services Purchasing Managers’ Index fell to 55.5 in July from 59.2 in June, the lowest level since March and below expectations in a Reuters poll of 58.5. But the index was above the 50 mark separating one-year growth and decline, and the July data was above the long-term average. Like many other countries, Asia’s third-largest economy is struggling with spiraling inflation – at its highest level in a decade – exacerbated by rising commodity prices. The weakening of the rupee increased imported inflation. The Reserve Bank of India (RBI) started the tightening cycle in May, following most of its peers, but is expected to initiate subsequent increases to combat inflation.

The major Asian stock markets had a mixed day today:

  • The NIKKEI 225 increased 190.30 points, or 0.69%, to 2,7932.20
  • Shanghai Index rose 25.37 points, or 0.80%, to 3,189.04 points
  • Hang Seng rose 406.95 points, or 2.06%, to 20174.04 points
  • ASX 200 fell 1.00 points or -0.01% to 6,974.90
  • The Kospi added 11.66 points, or 0.47 percent, to 2,473.11 points
  • Sensex shares fell 51.73 points, or -0.09%, to 58,298.80 points
  • Nifty50 fell 6.15 points or -0.04% to 17,382.00

The major Asian currency markets had a mixed day today:

  • AUDUSD rose 0.0033 or 0.48% to 0.69760
  • NZDUSD rose 0.00337 or 0.54% to 0.63037
  • USDJPY fell 1.047 or -0.78% to 133.048
  • USDCNY fell 0.00865 or -0.13% to 6.75185

Precious metals:

Gold rose $28.89/ton ounce. or 1.64% to 1,795.71

The price of silver rose to 0.188 USD / ton. ounces or 0.94% to 20.260

Some economic news from last night:

Japan:

Foreign bond purchases decreased from 112.0 billion to 37.1 billion

Foreign investment in Japanese stocks decreased from 297.6 billion to -120.3 billion

Australia:

Exports (MoM) (June) decreased from 8.9% to 5.1%

Imports (MoM) (June) decreased from 5.0% to 0.7%

The trade balance (June) increased from 15.016 billion to 17.670 billion

Europe/Europe, Middle East and Africa:

OPEC+ is set to raise its oil production target by 100,000 barrels per day, a setback that analysts say is a setback for US President Joe Biden after his trip to Saudi Arabia, where he asked the leader of the producer group to pump more to help the United States and the world. Economie. OPEC data shows that the 100,000 bpd increase would be the smallest since the introduction of OPEC quotas in 1982. The Organization of the Petroleum Exporting Countries (OPEC) and its allies led by Russia, the group known as OPEC+ formed in 2017, raised production by about 430,000 to 650,000 barrels per day in one month as they ended record supply cuts that occurred after the end of the pandemic blockade.

Less than a month after raising interest rates for the first time in more than a decade, traders are betting that the European Central Bank is already a third of the way through the tightening cycle. Money markets are indicating that the central bank will raise interest rates by another 100 basis points, or 1 percentage point. That’s about half of what was expected in late July. European Central Bank officials raised interest rates by 50 basis points last month, but since then more economists have predicted that the eurozone will succumb to recession this year, limiting the central bank’s ability to tighten policy. The combination of slightly higher interest rates and a looming recession caused investors to sell the euro and buy government bonds. German two-year bonds are up 0.21%, the lowest since May. The euro weakened 0.2% to $1.0238.

Major European stock markets had a green day:

The CAC 40 rose 41.33 points, or 0.64%, to 6513.39

The FTSE 100 rose 2.38 points, or 0.03%, to 7,448.06

The DAX 30 Index rose 75.12 points, or 0.55%, to 13,662.68 points

The major European currency markets had a mixed day today:

  • EURUSD rose 0.00888 or 0.87% to 1.02479
  • GBPUSD rose 0.0302 or 0.25% to 1.21707
  • USDCHF fell 0.00594 or -0.62% to 0.95456

Some economic news from Europe today:

Germany:

German Factory Orders (MoM) (June) decreased from -0.2% to -0.4%

IHS S&P Global Construction PMI (July) fell from 45.9 to 43.7

United kingdom:

Construction PMI (July) fell from 52.6 to 48.9

BoE rate decision (August) increased from 1.25% to 1.75%.

United States / America:

Initial jobless claims came in at 260,000 last week, the highest level not seen in the US since November. The previous week was revised upwards by 6,000, according to the Labor Department. The Bureau of Labor Statistics will release its closely watched non-farm payrolls report for July this Friday. Analysts expect job growth to reach 258,000 last month, down from 372,000 in June.

The US trade deficit in goods and services fell in June to $79.6 billion, a slight decrease from the previous month’s deficit of $5.3 billion. Exports jumped to $260.8 billion, or 1.7%, according to the Commerce Department, while imports fell to $340.4 billion, or 0.3%.

US market closing:

  • The Dow fell 85.68 points, or -0.26%, to 3,2726.82 points
  • The S&P 500 fell 3.23 points, or -0.08%, to 4,151.94
  • Nasdaq advanced 52.42 points, or 0.41%, to 12,720.58 points
  • Russell 2000 stock fell 2.47 points, or -0.13%, to 1,906.46

Canada market closing:

  • TSX Composite advances 31.1 points or 0.16% to 19577.04
  • TSX 60 advanced 2.71 points, or 0.23%, to 1184.05

Brazil market closing:

  • Bovespa advances 217.54 points or 2.04% to 105892.22

energy:

Oil markets had a negative day today:

l Crude Oil down $2.26/BBL or -2.49% to 88.573

Brent crude fell $2.85/BBL or -2.94% to 94.055

l Natural gas decreased $0.078/MMBtu or -0.94% to 8.1821

l Gasoline decreased $0.1285/gal or -4.41% to 2.7884

l Heating oil decreased $0.0927/gallon or -2.71% to 3.3285

The above data was collected around 14:58 EST on Thursday

Biggest Commodity Gainers: Platinum (3.61%), Cocoa (2.98%), Soybeans (3.66%) and Zinc (5.65%)

The biggest losers in commodities: Brent (-2.94%), bitumen (-2.85%), heating oil (-2.71%), gasoline (-4.41%).

The above data was collected around 15:04 EST on Thursday.

Bonds:

Japan 0.175% (-1.4 basis points), US 2 3.03% (-0.078%), US 10’s 2.6720% (-7.6 points per second); US 30 2.96% (-0.019%), Bond 0.8090% (-6.5 basis points), France 1.3520% (-8.8 basis points), Italy 2.969% (-5.4 basis points), Turkey 16.72% (-9 basis points) , Greece 2.977% (-6.9 basis points), Portugal 1.849% (-7.5 basis points); Spain 1.925% (-6.3 basis points) and British bonds 1.8870% (-2.6 basis points).

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