Market Talk – August 26, 2022

ASIA:

India’s cabinet on Thursday approved a policy to restrict wheat flour exports to calm prices in the local market, the government said in a statement. India banned wheat exports in mid-May as a scorching heatwave curtailed output and domestic prices hit a record high. In July India asked traders to secure permission before exporting wheat flour. Local wheat prices jumped to a record 24,500 rupees ($306.71) per tonne this week. That was up nearly 20% from recent lows that followed the government’s surprise ban on exports on May 14, ending hopes India could fill the market gap left by a plunge in exports from the Black Sea region following Russia’s Feb. 24 invasion of Ukraine.

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 increased 162.37 points or 0.57% to 28,641.38
  • Shanghai decreased 10.03 points or -0.31% to 3,236.22
  • Hang Seng increased 201.66 points or 1.01% to 20,170.04
  • ASX 200 increased 56.00 points or 0.79% to 7,104.10
  • Kospi increased 3.77 points or 0.15% to 2,481.03
  • SENSEX increased 59.15 points or 0.10% to 58,833.87
  • Nifty50 increased 36.45 points or 0.21% to 17,558.90

The major Asian currency markets had a mixed day today:

  • AUDUSD decreased 0.00570 or -0.81% to 0.69146
  • NZDUSD decreased 0.00800 or -1.29% to 0.61506
  • USDJPY increased 0.575 or 0.42% to 137.142
  • USDCNY increased 0.03560 or 0.52% to 6.88538
Related:  Market Talk - May 18, 2022

Precious Metals:

Gold decreased 23.54 USD/t oz. or -1.34% to 1,734.90

Silver decreased 0.354 USD/t. oz or -1.84% to 18.926

Some economic news from last night:

Japan:

Tokyo Core CPI (YoY) (Aug) increased from 2.3% to 2.6%

Tokyo CPI (YoY) (Aug) increased from 2.5% to 2.9%

CPI Tokyo Ex Food and Energy (MoM) (Aug) remain the same at 0.3%

Some economic news from today:

India:

Bank Loan Growth increased from 14.5% to 15.3%

Deposit Growth decreased from 9.1% to 8.8%

FX Reserves, USD decreased from 570.74B to 564.05B

EUROPE/EMEA:

Liz Truss will send the economy into an “inflationary spiral” unless she chooses between unfunded £50bn of tax cuts and cost of living support, her Conservative leadership opponent Rishi Sunak has claimed. The comments came after Truss, the front-runner to be the next prime minister, signaled another U-turn with direct support for businesses and households amid soaring energy bills this winter. Sunak’s campaign leader said Truss would increase borrowing to “historic and dangerous levels” and put the public finances at “serious risk” if he tried to do both.

The major Europe stock markets had a negative day:

CAC 40 decreased 107.30 points or -1.68% to 6,274.26

FTSE 100 decreased 52.43 points or -0.70% to 7,427.31

DAX 30 decreased 300.49 points or -2.26% to 12,971.47

Related:  Market Talk - June 2, 2022

The major Europe currency markets had a mixed day today:

  • EURUSD increased 0.00307 or 0.31% to 1.00023
  • GBPUSD decreased 0.00439 or -0.37% to 1.17843
  • USDCHF decreased 0.00024 or -0.02% to 0.96346

Some economic news from Europe today:

Germany:

GfK German Consumer Climate (Sep) decreased from -30.9 to -36.5

France:

French Consumer Confidence (Aug) increased from 80 to 82

Italy:

Italian Business Confidence (Aug) decreased from 106.4 to 104.3

Italian Consumer Confidence (Aug) increased from 94.8 to 98.3

Euro Zone:

M3 Money Supply (YoY) (Jul) decreased from 5.7% to 5.5%

Loans to Non Financial Corporations (Jul) increased from 6.8% to 7.7%

Private Sector Loans (YoY) decreased from 4.6% to 4.5%

US/AMERICAS:

Wall Street closed in the red this Friday after it was confirmed that the US economy is likely not in for a soft landing. Fed Chairman Jerome Powell spoke from Jackson Hole this Friday and reiterated the central bank’s hawkish sentiment. Price stability is the responsibility of the Federal Reserve and serves as the bedrock of our economy. Without price stability, the economy does not work for anyone,” Powell stated. Yet, restoring price stability will “take some time” and will require the Federal Open Market Committee to be “forceful” in their policy. Powell expects unemployment to rise as “the unfortunate cost” of reducing inflation.

Related:  Market Talk - June 29, 2022

US Market Closings:

  • Dow declined 1,008.38 points or -3.03% to 32,283.4
  • S&P 500 declined 141.46 points or -3.37% to 4,057.66
  • Nasdaq declined 497.55 points or -3.94% to 12,141.71
  • Russell 2000 declined 64.81 points or -3.3% to 1,899.83

Canada Market Closings:

  • TSX Composite declined 299.05 points or -1.48% to 19,873.29
  • TSX 60 declined 16.62 points or -1.37% to 1,200.71

Brazil Market Closing:

  • Bovespa declined 1,232.86 points or -1.09% to 112,298.86

ENERGY:

The oil markets had a mixed day today:

Crude Oil decreased 0.186 USD/BBL or -0.20% to 92.334

Brent increased 0.325 USD/BBL or 0.33% to 99.665

Natural gas increased 0.0655 USD/MMBtu or 0.70% to 9.4405

Gasoline decreased 0.0632 USD/GAL or -2.25% to 2.7489

Heating oil increased 0.0334 USD/GAL or 0.85% to 3.9825

The above data was collected around 12:22 EST on Friday

Top commodity gainers: Orange Juice (2.69%), Soybeans (2.69%), Sugar (2.96%) and Aluminum (2.94%)

Top commodity losers: Oat (-2.78%), Gasoline (-2.25%),  Palm Oil (-2.02%) and Silver (-1.84%)

The above data was collected around 12:33 EST on Friday.

BONDS:

Japan 0.220%(-1bp), US 2’s 3.42% (+0.041%), US 10’s 3.0390% (+1.5bps); US 30’s 3.20% (-0.029%), Bunds 1.405% (+7.6bp), France 2.039% (+10.5bp), Italy 3.7420% (+18.9bp), Turkey 12.94% (+0bp), Greece 3.962% (+5.9bp), Portugal 2.530% (+12.1bp); Spain 2.630% (+13.5bp) and UK Gilts 2.6210% (+0.3bp).

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