Market Talk – February 17, 2023

Due to the NYSE closing for Presidents’ Day, Market Talk will resume on Tuesday, Feb. 21.

ASIA:

Singapore’s economy grew slightly less than initially estimated in the fourth quarter from a year ago, official data showed on Monday, and the government kept its forecast for annual growth to come in at 0.5% – 2.5% this year. Gross domestic product (GDP) grew 2.1% year-on-year in the fourth quarter, the Ministry of Trade and Industry (MTI) said, slightly lower than the 2.2% growth in the government’s advance estimate due to slightly weaker construction and service sector growth. Analysts said that some services industries would fare better this year amid China’s reopening, while manufacturing, especially electronics, is likely to weigh on growth in the short-term. Since April last year, Singapore had lifted most of its COVID-19 restrictions with many international events returning to the city-state, attracting tourists and businesses. The remaining restrictions will be relaxed from Monday. The Asian financial hub is expecting tourism to recover to pre-pandemic levels by 2024.

The major Asian stock markets had a negative day today:

• NIKKEI 225 decreased 183.31 points or -0.66% to 27,513.13
• Shanghai decreased 25.01 points or -0.77% to 3,224.02
• Hang Seng decreased 267.86 points or -1.28% to 20,719.81
• ASX 200 decreased 63.50 points or -0.86% to 7,346.80
• Kospi decreased 24.27 points or -0.98% to 2,451.21
• SENSEX decreased 316.94 points or -0.52% to 61,002.57
• Nifty50 decreased 91.65 points or -0.51% to 17,944.20

The major Asian currency markets had a mixed day today:

• AUDUSD decreased 0.00079 or -0.11% to 0.68681
• NZDUSD decreased 0.00154 or -0.25% to 0.62386
• USDJPY increased 0.269 or 0.20% to 134.209
• USDCNY increased 0.00653 or 0.10% to 6.87453

Precious Metals:

• Gold increased 3.21 USD/t oz. or 0.17% to 1,840.65
• Silver increased 0.113 USD/t. oz or 0.52% to 21.713

No economic news from last night:

Some economic news from today:

India:

FX Reserves, USD decreased from 575.27B to 566.95B

EUROPE/EMEA:

Russia’s central bank said on Friday that inflationary pressures across the economy had remained strong during the first two weeks of February, citing a slump in the rouble as a factor. Russia recorded inflation of 11.8% on an annual basis in January, almost three times the central bank’s official 4% target. It signaled last week it was preparing to raise base interest rates to cool inflation. The rouble has fallen 16% since the start of December when a European Union embargo and G7 price cap on Russian crude sales came into force.

The major Europe stock markets had a negative day:

• CAC 40 decreased 18.44 points or -0.25% to 7,347.72
• FTSE 100 decreased 8.17 points or -0.10% to 8,004.36
• DAX 30 decreased 51.64 points or -0.33% to 15,482.00

The major Europe currency markets had a green day today:

• EURUSD increased 0.00109 or 0.10% to 1.06789
• GBPUSD increased 0.00263 or 0.22% to 1.20193
• USDCHF increased 0.00131 or 0.14% to 0.92651

Some economic news from Europe today:

UK:

Core Retail Sales (MoM) (Jan) increased from -1.4% to 0.4%

Core Retail Sales (YoY) (Jan) increased from -6.5% to -5.3%

Retail Sales (YoY) (Jan) increased from -6.1% to -5.1%

Retail Sales (MoM) (Jan) increased from -1.2% to 0.5%

Germany:

German PPI (MoM) (Jan) decreased from -0.4% to -1.0%

France:

French CPI (MoM) (Jan) increased from -0.1% to 0.4%

French HICP (MoM) (Jan) remain the same at 0.4%

US/AMERICAS:

The US economy is recovering, but has a long way to go, according to Federal Reserve Governor Michelle Bowman. “I think there’s a long way to go before we reach our 2% inflation objective and I think we’ll have to continue to raise the federal funds rate until we see a lot more progress on that,” she said this Friday. Her remarks one day after Cleveland Fed President Loretta Mester optimistically stated that price stability will improve in a meaningful way by the end of the year, with the 2% target being achieved by 2025. Yet various reports released this week indicate that inflation has not improved in a meaningful way.

The Conference Board’s Leading Economic Index projects that the US is heading into a recession. The index reported a 0.3% decline, which was in line with expectations. The index believes that conditions will deteriorate by 3.6% over the next six months. The Conference Board believes higher prices and rates combined with lower consumer spending will tilt the economy into a recession.

US Market Closings:

• Dow advanced 129.97 points or 0.39% to 33,826.82
• S&P 500 declined 11.25 points or -0.28% to 4,079.16
• Nasdaq declined 68.56 points or -0.58% to 11,787.27
• Russell 2000 advanced 4.14 points o 0.21% to 1,946.36

Canada Market Closings:

• TSX Composite declined 91.18 points or -0.44% to 20,515.24
• TSX 60 declined 5.69 points or -0.46% to 1,235.92

Brazil Market Closing:

• Bovespa declined 764.54 points or -0.7% to 109,176.92

ENERGY:

The oil markets had a negative day today:

• Crude Oil decreased 2.708 USD/BBL or -3.45% to 75.782
• Brent decreased 2.612 USD/BBL or -3.07% to 82.528
• Natural gas decreased 0.1479 USD/MMBtu or -6.19% to 2.2411
• Gasoline decreased 0.0642 USD/GAL or -2.64% to 2.3713
• Heating oil decreased 0.1253 USD/GAL or -4.46% to 2.6855

The above data was collected around 12:53 EST on Friday

• Top commodity gainers: Steel (1.91%), Orange Juice (2.07%), Coffee (4.45%), and Zinc (1.85%)
• Top commodity losers: Rhodium (-3.31%), Heating Oil (-4.46%), Natural Gas (-6.19%), and Crude Oil (-3.45%)

The above data was collected around 13:12 EST on Friday

BONDS:

Japan 0.504%(+0.4bp), US 2’s 4.64% (+0.019%), US 10’s 3.8379%(-0.51bps); US 30’s 3.89% (-0.009%), Bunds 2.437% (-4.6bp), France 2.893% (-4.3bp), Italy 4.274% (-5bp), Turkey 10.50% (-19bp), Greece 4.33% (+1.7bp), Portugal 3.349% (-3.3bp); Spain 3.486% (-3.4bp) and UK Gilts 3.509% (+0.7bp).

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