Market Talk – February 28, 2023

ASIA:

India’s Gross Domestic Product (GDP) growth slowed to a three-quarter low of 4.4 percent in October-December 2022-23 primarily due to a 1.1 percent contraction in manufacturing, along with weaker private consumption demand and government expenditure, according to data released by the National Statistical Office (NSO) on Tuesday. Slowing from 6.3 percent in July-September and 13.2 percent in April-June quarter, the third quarter reflected the impact of subdued consumption demand and exports amid rising input costs and interest rates as the Reserve Bank of India remained focused on “withdrawal of accommodation.” The fourth quarter GDP estimate at 5.1 percent is way higher than the projection of 4.2 per cent for Q4 given by the Reserve Bank of India (RBI) in its December policy review (with FY23 growth estimate at 6.8 percent). Chief Economic Adviser V Anantha Nageswaran said manufacturing, on the face of it, has slowed down but there are enough high-frequency indicators showing fairly robust manufacturing activity.

The major Asian stock markets had a mixed day today:

• NIKKEI 225 increased 21.60 points or 0.08% to 27,445.56
• Shanghai increased 21.57 points or 0.66% to 3,279.61
• Hang Seng decreased 157.57 points or -0.79% to 19,785.94
• ASX 200 increased 33.60 points or 0.47% to 7,258.40
• Kospi increased 10.21 points or 0.42% to 2,412.85
• SENSEX decreased 326.23 points or -0.55% to 58,962.12
• Nifty50 decreased 88.75 points or -0.51% to 17,303.95

The major Asian currency markets had a mixed day today:

• AUDUSD increased 0.00177 or 0.26% to 0.67517
• NZDUSD increased 0.00382 or 0.62% to 0.62042
• USDJPY decreased 0.415 or -0.30% to 135.785
• USDCNY decreased 0.01333 or -0.19% to 6.94587

Precious Metals:

• Gold increased 12.95 USD/t oz. or 0.71% to 1,830.26
• Silver increased 0.349 USD/t. oz or 1.69% to 20.973

Some economic news from last night:

Japan:

Industrial Production (MoM) (Jan) decreased from 0.3% to -4.6%

Retail Sales (YoY) (Jan) increased from 3.8% to 6.3%

Australia:

Current Account (Q4) increased from -2.3B to 14.1B

Private Sector Credit (MoM) (Jan) increased from 0.3% to 0.4%

Retail Sales (MoM) (Jan) increased from -3.9% to 1.9%

New Zealand：

ANZ Business Confidence (Feb) increased from -52.0 to -43.3

Some economic news from today:

India:

GDP Quarterly (YoY) (Q3) decreased from 6.3% to 4.4%

EUROPE/EMEA:

Developing a resilient, safe and secure central bank digital currency (CBDC) for the UK, known as the Digital Pound, will take at least five years according to the deputy governor of the Bank of England Sir Jon Cunliffe. This will involve working with the financial services sector and private companies, he told MPs examining the need for such a technology. Developing a resilient, safe and secure central bank digital currency (CBDC) for the UK, known as the Digital Pound, will take at least five years according to the deputy governor of the Bank of England Sir Jon Cunliffe. This will involve working with the financial services sector and private companies, he told MPs examining the need for such a technology. The Treasury announced earlier this month that it would make a decision on whether to launch a Digital Pound by 2025, giving the Bank of England and commercial partners time to test and investigate the technology. It followed a consultation paper published by the Bank of England that said some degree of CBDC would be needed in the future.

The major Europe stock markets had a negative day:

• CAC 40 decreased 27.62 points or -0.38% to 7,267.93
• FTSE 100 decreased 58.83 points or -0.74% to 7,876.28
• DAX 30 decreased 16.29 points or -0.11% to 15,365.14

The major Europe currency markets had a mixed day today:

• EURUSD decreased 0.00039 or -0.04% to 1.06031
• GBPUSD increased 0.00321 or 0.27% to 1.20941
• USDCHF increased 0.002 or 0.21% to 0.93760

Some economic news from Europe today:

France:

French Consumer Spending (MoM) (Jan) increased from -1.6% to 1.5%

French CPI (MoM) (Feb) increased from 0.4% to 0.9%

French GDP (QoQ) (Q4) remain the same at 0.1%

French GDP (YoY) decreased from 1.0% to 0.5%

Swiss:

KOF Leading Indicators (Feb) increased from 97.4 to 100

GDP (YoY) (Q4) remain the same at 0.8%

GDP (QoQ) (Q4) decreased from 0.2% to 0.0%

Spain:

Spanish CPI (YoY) increased from 5.9% to 6.1%

Spanish HICP (YoY) (Feb) increased from 5.9% to 6.1%

US/AMERICAS:

Americans are losing confidence in the US economy as the cost of living continues to rise. The Conference Board’s Consumer Confidence Index fell this February for the second month in a row. The index is now 102.9, beneath January’s reading of 106. The Present Situation Index, calculating consumers’ assessment of the current market conditions, was slightly higher in February coming in at 152.8 compared to last month’s reading of 151.1. However, consumers do not expect these conditions to last. The Expectations Index fell to 69.7 while January’s figure was revised down to 76. The Expectation Index reading below 80 often indicates a looming recession, and in this case, it has been beneath that level for 11 of the last 12 months.

US Market Closings:

• Dow declined 232.39 points or -0.71% to 32,656.7
• S&P 500 declined 12.09 points or -0.3% to 3,970.15
• Nasdaq declined 11.44 points or -0.1% to 11,455.54
• Russell 2000 advanced 0.72 of a point or 0.04% to 1,896.99

Canada Market Closings:

• TSX Composite delined 38.94 points or -0.19% to 20,221.19
• TSX 60 declined 3.52 points or -0.29% to 1,216.73

Brazil Market Closing:

• Bovespa declined 779.12 points or -0.74% to 104,931.93

ENERGY:

The oil markets had a mixed day today:

• Crude Oil increased 1.663 USD/BBL or 2.20% to 77.343
• Brent increased 1.253 USD/BBL or 1.53% to 83.293
• Natural gas decreased 0.0927 USD/MMBtu or -3.39% to 2.6383
• Gasoline increased 0.051 USD/GAL or 1.97% to 2.6350
• Heating oil increased 0.0097 USD/GAL or 0.35% to 2.8100

The above data was collected around 13:06 EST on Tuesday

• Top commodity gainers: Crude Oil (2.20%), HRC Steel (7.05%), Copper (2.14%) and Lumber (2.83%)
• Top commodity losers: Oat (-4.77%), Rhodium (-2.34%), Butter (-2.02%) and Natural Gas (-3.39%)

The above data was collected around 13:12 EST Tuesday.

BONDS:

Japan 0.500% (-0.2bp), US 2’s 4.80% (+0.004%), US 10’s 3.9317% (+0.97bps); US 30’s 3.94% (+0.021%), Bunds 2.641% (+5.4bp), France 3.108% (+5.7bp), Italy 4.449% (+2.8bp), Turkey 9.99% (-28bp), Greece 4.482% (+8.3bp), Portugal 3.534% (+6.1bp); Spain 3.67% (+4.8bp) and UK Gilts 3.817% (+0.7bp).

The post Market Talk – February 28, 2023 first appeared on Armstrong Economics.