Market Talk – June 14, 2022

ASIA:

The Japanese economy contracted in the first quarter, but at a slower pace than earlier estimated, the government data released  last Wednesday showed. The world’s third-largest economy contracted at an annual rate of 0.5 per cent, according to Cabinet Office data. That was smaller than the 1.0 per cent contraction in the preliminary estimate for Japan’s real gross domestic product, or GDP, released in May. Consumer spending and other private demand was stronger than previously thought.

The major Asian stock markets had a mixed day today:

• NIKKEI 225 decreased 357.58 points or -1.32% to 26,629.86

• Shanghai increased 33.36 points or 1.02% to 3,288.91

• Hang Seng increased 0.41 points or 0.00% to 21,067.99

• ASX 200 decreased 246.00 points or -3.55% to 6,686.00

• Kospi decreased 11.54 points or -0.46% to 2,492.97

• SENSEX decreased 153.13 points or -0.29% to 52,693.57

• Nifty50 decreased 42.30 points or -0.27% to 15,732.10

The major Asian currency markets had a mixed day today:

• AUDUSD decreased 0.00638 or -0.92% to 0.68718

• NZDUSD decreased 0.0044 or -0.70% to 0.62140

• USDJPY increased 0.542 or 0.40% to 134.867

• USDCNY decreased 0.03189 or -0.47% to 6.74841

Precious Metals:

l Gold decreased 7.99 USD/t oz. or -0.44% to 1,810.78

l Silver decreased 0.047 USD/t. oz or -0.22% to 21.005

Some economic news from last night:

China:

FDI (May) decreased from 20.50% to 17.30%

Australia:

NAB Business Confidence (May) decreased from 10 to 6

NAB Business Survey (May) decreased from 19 to 16

New Zealand:

FPI (MoM) (May) increased from 0.1% to 0.7%

Some economic news from today:

Japan:

Capacity Utilization (MoM) (Apr) increased from -1.6% to 0.0%

Industrial Production (MoM) (Apr) decreased from -1.3% to -1.5%

India:

WPI Food (YoY) (May) increased from 8.35% to 12.34%

WPI Fuel (YoY) (May) increased from 38.66% to 40.62%

WPI Inflation (YoY) (May) increased from 15.08% to 15.88%

WPI Manufacturing Inflation (YoY) (May) decreased from 10.85% to 10.11%

EUROPE/EMEA:

European steel prices are plunging as weakening manufacturing demand combines with inventories that were replenished following Russia’s invasion of Ukraine. Hot-rolled coil — the benchmark flat steel product — has dropped by almost a third since reaching a record in March. Prices are now trading below 1,000 euros ($1,042) a ton for the first time since February, according to Kallanish Commodities. The drop in prices could depress the profits of the bloc’s steelmakers, which have reaped a windfall from the commodities boom that followed the pandemic.

The major Europe stock markets had a negative day:

• CAC 40 decreased 72.48 points or -1.20% to 5,949.84

• FTSE 100 decreased 18.35 points or -0.25% to 7,187.46

• DAX 30 decreased 122.64 points or -0.91% to 13,304.39

The major Europe currency markets had a mixed day today:

• EURUSD increased 0.00178 or 0.17% to 1.04274

• GBPUSD decreased 0.01438 or -1.19% to 1.19902

• USDCHF increased 0.00327 or 0.33% to 1.00087

Some economic news from Europe today:

UK:

Average Earnings Index +Bonus (Apr) decreased from 7.0% to 6.8%

Claimant Count Change (May) increased from -65.5k to -19.7K

Employment Change 3M/3M (MoM) (Apr) increased from 83K to 177k

Unemployment Rate (Apr) increased from 3.7% to 3.8%

Germany:

German CPI (MoM) (May) increased from 0.8% to 0.9%

German CPI (YoY) (May) increased from 7.4% to 7.9%

German HICP (YoY) (May) increased from 7.8% to 8.7%

German HICP (MoM) (May) increased from 0.7% to 1.1% German WPI (YoY) (May) decreased from 23.8% to 22.9%

German WPI (MoM) (May) decreased from 2.1% to 1.0%

German ZEW Current Conditions (Jun) increased from -36.5 to -27.6

German ZEW Economic Sentiment (Jun) increased from -34.3 to -28.0

Euro Zone:

ZEW Economic Sentiment (Jun) increased from -29.5 to -28.0

US/AMERICAS:

Wholesale prices in the US advanced 10.8% in May as inflationary pressures continue to grow. The producer price index grew 0.8% for the month and 10.8% YoY, according to data provided by the Bureau of Labor Statistics. Core PPI advanced 0.5% for the month, but was up 6.8% on an annual basis. Energy accounted for the majority of the rise after rising 5% for the month, while gasoline soared 8.4%.

US Market Closings:

• Dow declined 151.91 points or -0.5% to 30,364.83
• S&P 500 declined 14.15 points or -0.38% to 3,735.48
• Nasdaq advanced 19.12 points or 0.18% to 10,828.35
• Russell 2000 DECLINED 6.77 points or -0.39% to 1,707.83

Canada Market Closings:

• TSX Composite declined 194.05 points or -0.98% to 19,548.51
• TSX 60 declined 9.94 points or -0.83% to 1,184.58

Brazil Market Closing:

• Bovespa declined 534.93 points or -0.52% to 102,063.25

ENERGY:

The oil markets had a mixed day today:

l Crude Oil decreased 0.93 USD/BBL or -0.77% to 120.000

l Brent decreased 0.47 USD/BBL or -0.38% to 121.80

l Natural gas decreased 1.381 USD/MMBtu or -16.04% to 7.2270

l Gasoline decreased 0.0512 USD/GAL or -1.27% to 3.9841

l Heating oil increased 0.1195 USD/GAL or 2.79% to 4.4029

The above data was collected around 14:22 EST on Tuesday

l Top commodity gainers: Lumber (2.08%), Bitumen (2.06%), Heating Oil (2.79%) and Steel (1.30%)

l Top commodity losers: Aluminum (-2.51%), Wheat (-1.96%), Coal (-1.88%) and Natural Gas (-16.04%)

The above data was collected around 14:27 EST on Tuesday.

BONDS:

Japan 0.256%(+0.1bp), US 2’s 3.41% (+0.045%), US 10’s 3.4482% (+8.65bps); US 30’s 3.42% (+0.063%), Bunds 1.771% (+14.4bp), France 2.3950% (+15.2bp), Italy 4.270% (+17bp), Turkey 18.77% (-175bp), Greece 4.719% (+27.8bp), Portugal 3.171% (+17.2bp); Spain 3.180% (+19.5bp) and UK Gilts 2.5920% (+7bp).

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