Market Talk – May 11, 2022

ASIA:

India has asked its central bank to either buy back government bonds or conduct open market operations to cool yields that have hit their highest since 2019, as inflation risks push foreign investors to sell, a government source told Reuters on Monday. The 10-year benchmark bond ended at 93.69 rupees on Monday, yielding 7.46%, after earlier reaching a high of 7.49%. The official said the RBI would take a decision on the timing and size of any bond purchases next week.

Japan’s household spending fell in March for the first time in three months, though the 2.3% drop was smaller than expected, as consumers remained cautious despite some easing of COVID-19 curbs. Government data on Tuesday confirmed the March spending drop versus the same month a year earlier. The decrease was narrower than Reuters’ median market estimate for a 2.8% drop and followed 1.1% growth in February.

The major Asian stock markets had a mixed day today:
• NIKKEI 225 decreased 152.24 points or -0.58% to 26,167.10
• Shanghai increased 31.70 points or 1.06% to 3,035.84
• Hang Seng decreased 368.27 points or -1.84% to 19,633.69
• ASX 200 decreased 69.50 points or -0.98% to 7,051.20
• Kospi decreased 14.25 points or -0.55% to 2,596.56
• SENSEX decreased 105.82 points or -0.19% to 54,364.85
• Nifty50 decreased 61.80 points or -0.38% to 16,240.05

The major Asian currency markets had a negative day today:
• AUDUSD decreased 0.00133 or -0.19% to 0.69479
• NZDUSD decreased 0.00254 or -0.40% to 0.62996
• USDJPY   decreased 0.086 or -0.07% to 130.343
• USDCNY decreased 0.00995 or -0.15% to 6.74686

Precious Metals:
• Gold decreased 8.47 USD/t oz. or -0.46% to 1,845.45
• Silver decreased 0.234 USD/t. oz or -1.07% to 21.557


Some economic news from last night:
Japan:
Household Spending (YoY) (Mar) decreased from 1.1% to -2.3%
Household Spending (MoM) (Mar) increased from -2.8% to 4.1%
South Korea:
Current Account (Mar) increased from 6.42B to 6.73B
Australia:
NAB Business Confidence (Apr) decreased from 16 to 10
NAB Business Survey (Apr) increased from 15 to 20
Retail Sales (QoQ) (Q1) decreased from 7.9% to 1.2%
New Zealand:
Electronic Card Retail Sales (YoY) (Apr) increased from -0.5% to 2.1%
Electronic Card Retail Sales (MoM) (Apr) increased from -1.3% to 7.0%





EUROPE/EMEA:

Prime Minister Boris Johnson plans to announce that he will breach treaty obligations under the Northern Ireland Protocol, a key part of Britain’s post-Brexit relationship with the European Union, ITV political editor Robert Peston said. Britain said earlier on Tuesday it would take all necessary steps to protect peace in Northern Ireland as it urged the EU to show more flexibility.

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The major Europe stock markets had a green day:

• CAC 40 increased 30.89 points or 0.51% to 6,116.91
• FTSE 100 increased 26.64 points or 0.37% to 7,243.22
• DAX 30  increased 154.07 points or 1.15% to 13,534.74


The major Europe currency markets had a mixed day today:
• EURUSD decreased 0.00305 or -0.29% to 1.05373
• GBPUSD decreased 0.00166 or -0.13% to 1.23236
• USDCHF increased 0.00195 or 0.20% to 0.99489

Some economic news from Europe today:
Norway:
Core CPI YTD (Apr) increased from 2.1% to 2.6%
Core Inflation (MoM) (Apr) increased from 0.3% to 0.9%
CPI (YoY) (Apr) increased from 4.5% to 5.4%
CPI (MoM) (Apr) increased from 0.6% to 1.2%
PPI (YoY) (Apr) decreased from 79.4% to 66.4%
Italy:
Italian Industrial Production (MoM) (Mar) decreased from 4.0% to 0.0%
Italian Industrial Production (YoY) (Mar) decreased from 3.4% to 3.0%
Germany:
German ZEW Current Conditions (May) decreased from -30.8 to -36.5
German ZEW Economic Sentiment (May) increased from -41.0 to -34.3
Euro Zone:     
ZEW Economic Sentiment (May) decreased from 43.0 to 29.5

US/AMERICAS:

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President Biden addressed inflation concerns today. “The first cause of inflation is a once-in-a-century pandemic. Not only did it shut down our global economy, it threw supply chains and demand completely out of whack,” Biden stated. He went on to blame the war in Ukraine and the spike in oil prices. The president announced that his administration is considering repealing Trump-era tariffs on China in an effort to lower prices. The much-anticipated inflation report will be released tomorrow morning, and the markets are preparing for another 8% or higher rise.

US Market Closings:

  • Dow declined 85.29 points or -0.26% to 32,160.41
  • S&P 500 advanced 9.83 points or 0.25% to 4,001.07
  • Nasdaq advanced 114.42 points or 0.98% to 11,737.67
  • Russell 2000 declined 0.29 of a point or -0.02% to 1,761.79
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Canada Market Closings:

  • TSX Composite declined  109.63  points or 0.54% to 49,087.04
  • TSX 60 declined 6.52 points or -0.54% to 1,209.27

Brazil Market Closing:

  • Bovespa declined 140.08 points or -0.14% to 103,109.94


ENERGY:

The oil markets had a mixed day today:

• Crude Oil decreased 2.78 USD/BBL or -2.70% to 100.3100
• Brent decreased 2.86 USD/BBL or -2.70% to 103.08
• Natural gas increased 0.243 USD/MMBtu or 3.46% to 7.2690
• Gasoline decreased 0.1029 USD/GAL or -2.83% to 3.5390
• Heating oil increased 0.1042 USD/GAL or 2.72% to 3.9391

The above data was collected around 14:04 EST on Tuesday

• Top commodity gainers: Natural Gas (3.46%) and Heating Oil (2.72%),  Platinum (1.64%),  Methanol (0.97%)
• Top commodity losers: Oat (-2.71%),  Bitumen (-3.41%), Rhodium (-3.82%) and Gasoline (-2.83%)

The above data was collected around 14:11 EST on Tuesday.


BONDS: 

Japan 0.249%(+0.4bp), US 2’s 2.62% (+0.019%), US 10’s 2.9790% (-5.48bps); US 30’s 3.11% (-0.047%), Bunds 1.013% (-7.5bp), France 1.555% (-7.1bp), Italy 3.017% (-12.5bp), Turkey 22.27% (+45bp), Greece 3.515% (-13.1bp), Portugal 2.168% (-8.5bp); Spain 2.157% (-5bp) and UK Gilts 1.8490% (-10.6bp).

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