Market Talk – July 1, 2022

ASIA:

China’s huge manufacturing and service industries just saw their first month of growth since February, according to surveys published Thursday, as Covid restrictions were eased in many cities. But the shadow of further lockdowns still looms over the world’s second biggest economy as Beijing sends mixed messages about the best way out of the Covid pandemic. The Chinese government’s purchasing managers’ index (PMI) for manufacturing — which mainly covers larger businesses and state-owned companies — rose to 50.2 in June, the first time it has crossed the 50 mark since February, according to the National Bureau of Statistics. A reading above 50 indicates that activity is increasing.

The major Asian stock markets had a negative day today:

  • NIKKEI 225 decreased 457.42 points or -1.73% to 25,935.62
  • Shanghai decreased 10.98 points or -0.32% to 3,387.64
  • Hang Seng closed
  • ASX 200 decreased 28.20 points or -0.43% to 6,539.90
  • Kospi decreased 27.22 points or -1.17% to 2,305.42
  • SENSEX decreased 111.01 points or -0.21% to 52,907.93
  • Nifty50 decreased 28.20 points or -0.18% to 15,752.05

The major Asian currency markets had a mixed day today:

  • AUDUSD decreased 0.01033 or -1.50% to 0.67950
  • NZDUSD decreased 0.00482 or -0.77% to 0.61928
  • USDJPY decreased 0.541 or -0.40% to 135.287
  • USDCNY increased 0.00863 or 0.13% to 6.70143

Precious Metals:

  • Gold decreased 3.5 USD/t oz. or -0.19% to 1,803.39
  • Silver decreased 0.439 USD/t. oz or -2.17% to 19.808

Some economic news from last night:

China:

Caixin Manufacturing PMI (Jun) increased from 48.1 to 51.7

Japan:

Manufacturing PMI (Jun) remain the same at 52.7

Jobs/applications ratio (May) increased from 1.23 to 1.24

Tokyo Core CPI (YoY) (Jun) increased from 1.9% to 2.1%

Tokyo CPI (YoY) (Jun) decreased from 2.4% to 2.3%

CPI Tokyo Ex Food and Energy (MoM) (Jun) decreased from 0.2% to -0.1%

Unemployment Rate (May) increased from 2.5% to 2.6%

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Tankan All Big Industry CAPEX (Q2) increased from 2.2% to 18.6%

Tankan All Small Industry CAPEX (Q2) increased from -11.4% to -1.4%

Tankan Big Manufacturing Outlook Index (Q2) increased from 9 to 10

Tankan Large Manufacturers Index (Q2) decreased from 14 to 9

Tankan Large Non-Manufacturers Diffusion Index (Q2) increased from 7 to 13

Tankan Large Non-Manufacturers Index (Q2) increased from 9 to 13

South Korea:

Exports (YoY) (Jun) decreased from 21.3% to 5.4%

Imports (YoY) (Jun) decreased from 32.0% to 19.4%

Trade Balance (Jun) decreased from -1.71B to -2.47B

Nikkei Manufacturing PMI (Jun) decreased from 51.8 to 51.3

Australia:

AIG Manufacturing Index (Jun) increased from 52.4 to 54.0

Manufacturing PMI increased from 55.7 to 56.2

New Zealand:

Building Consents (MoM) (May) increased from -8.6% to -0.5%

Some economic news from today:

Australia:

Commodity Prices (YoY) decreased from 34.7% to 24.3%

India:

Nikkei S&P Global Manufacturing PMI (Jun) decreased from 54.6 to 53.9

Bank Loan Growth increased from 13.1% to 13.2%

Deposit Growth decreased from 9.3% to 8.3%

FX Reserves, USD increased from 590.59B to 593.32B

EUROPE/EMEA:

The British economy expanded 0.8% on quarter in the first three months of 2022, the lowest in a year, and in line with preliminary estimates. The largest contributors were information and communication, and transport and storage while production output was primarily driven by a rise in manufacturing output; and construction output rose. Also, household final consumption expenditure grew 0.6%, whereas gross fixed capital formation grew by a revised 3.8%. Still, real household disposable income fell by 0.2%, the fourth consecutive quarter of real negative growth in disposable income. The GDP remains 0.7% above its pre-pandemic level.

The major Europe stock markets had a mixed day:

  • CAC 40 increased 8.20 points or 0.14% to 5,931.06
  • FTSE 100 decreased 0.63 points or -0.01% to 7,168.65
  • DAX 30 increased 29.26 points or 0.23% to 12,813.03
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The major Europe currency markets had a mixed day today:

  • EURUSD decreased 0.0068 or -0.65% to 1.04079
  • GBPUSD decreased 0.01055 or -0.87% to 1.20541
  • USDCHF increased 0.00746 or 0.78% to 0.96236

Some economic news from Europe today:

Spain:

Spanish Manufacturing PMI (Jun) decreased from 53.8 to 52.6

Swiss:

procure.ch PMI (Jun) decreased from 60.0 to 59.1

Italy:

Italian Manufacturing PMI (Jun) decreased from 51.9 to 50.9

Italian CPI (MoM) (Jun) increased from 0.8% to 1.2%

Italian CPI (YoY) (Jun) increased from 6.8% to 8.0%

Italian HICP (YoY) (Jun) increased from 7.3% to 8.5%

Italian HICP (MoM) (Jun) increased from 0.9% to 1.2%

France:

French Manufacturing PMI (Jun) decreased from 54.6 to 51.4

French Government Budget Balance (May) decreased from -67.3B to -82.3B

Germany:

German Manufacturing PMI (Jun) decreased from 54.8 to 52.0

Euro Zone:

Manufacturing PMI (Jun) decreased from 54.6 to 52.1

Core CPI (YoY) decreased from 3.8% to 3.7%

Core CPI (MoM) decreased from 0.5% to 0.2%

CPI (MoM) remain the same at 0.8%

CPI (YoY) (Jun) increased from 8.1% to 8.6%

CPI, n.s.a (Jun) increased from 116.07 to 117.00

HICP ex Energy & Food (YoY) (Jun) increased from 4.4% to 4.6%

HICP ex Energy and Food (MoM) decreased from 0.7% to 0.4%

UK:

BoE Consumer Credit (May) decreased from 1.377B to 0.844B

M4 Money Supply (MoM) (May) increased from 0.0% to 0.5%

Manufacturing PMI (Jun) decreased from 54.6 to 52.8

Mortgage Approvals (May) increased from 66.06K to 66.16K

Mortgage Lending (May) increased from 4.16B to 7.43B

Net Lending to Individuals increased from 5.5B to 8.3B

US/AMERICAS:

A recession is brewing. At least that is what the latest measurement from the Atlanta Federal Reserve is indicating. The bank slashed its forecast for Q2 GDP to represent a -1% contraction. This comes after the US economy shrank -1.6% in Q1, and based on most measurements, two consecutive quarters of negative growth signifies that the nation is in recessionary territory.

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The White House has designated more money for Ukraine at the bill of $820 million

US Market Closings:

  • Dow advanced 321.83 points or 1.05% or 31,-97.26
  • S&P 500 advanced 39.95 points 1.06% to 3,825.33
  • Nasdaq advanced 99.11 points or 0.9% to 11,127.85
  • Russell 2000 advanced 19.77 points or 1.16% to 1,727.76

Canada Market Closings:

  • TSX Composite declined 216.28 points or -1.14% to 18,861.36
  • TSX 60 declined 13.66 points or -1.18% to 1,146.43

Brazil Market Closing:

  • Bovespa advanced 411.95 points or 0.42% to 98,953.9

ENERGY:

The oil markets had a green day today:

  • Crude Oil increased 2.32 USD/BBL or 2.19% to 108.080
  • Brent increased 2.15 USD/BBL or 1.97% to 111.18
  • Natural gas increased 0.297 USD/MMBtu or 5.48% to 5.7210
  • Gasoline increased 0.1294 USD/GAL or 3.66% to 3.6657
  • Heating oil increased 0.1111 USD/GAL or 2.90% to 3.9416

The above data was collected around  12:47 EST on Friday

  • Top commodity gainers: Natural Gas (5.48%), Gasoline (3.66%), Heating Oil (2.90%) and Cotton (3.81%)
  • Top commodity losers: Oat (-3.93%), Wheat (-3.77%), Palm Oil (-4.11%) and Sugar (-4.04%)

The above data was collected around 12:56 EST on Friday.

BONDS:

Japan 0.221%(-0.4bp), US 2’s 2.83% (-0.092%), US 10’s 2.8968% (-7.72bps); US 30’s 3.13% (+0.008%), Bunds 1.243% (-12.5bp), France 1.8110% (-14.6bp), Italy 3.225% (-16.7bp), Turkey 18.56% (+2bp), Greece 3.517% (-10.3bp), Portugal 2.319% (-13.8bp); Spain 2.291% (-17.1bp) and UK Gilts 2.0970% (-14.4bp).

Original Article

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