Market Talk – March 23, 2023

ASIA:

China’s central bank kept interest rates unchanged while increasing liquidity injections for a fourth consecutive month, with the aim of supplying the market with enough long-term funds. The move also indicates policymakers’ comfort with the country’s modest economic growth target for this year, set at around 5%, which is at the lower end of expectations. The injection of 281 billion yuan in fresh funds came from the rollover of 200-billion-yuan worth of one-year medium-term policy loans, with the interest rate remaining at 2.75%.

India’s Finance Ministry expects the country’s economy to grow by 7% in FY23, despite global headwinds. The current account deficit is also estimated to fall in FY23 and FY24, providing a buffer to the rupee in uncertain times. This is due to gains from high services exports, moderation in oil prices, and a fall in import-intensive consumption demand. The ministry added that the jump in net service exports and the easing of global commodity prices have contributed to macroeconomic stability, and this is expected to improve further in FY23 with the narrowing of the current account deficit.

The major Asian stock markets had a mixed day today:

• NIKKEI 225 decreased 47.00 points or -0.17 % to 27,419.61
• Shanghai increased 20.90 points or 0.64% to 3,286.65
• Hang Seng increased 458.21 points or 2.34% to 20,049.64
• ASX 200 decreased 47.00 points or -0.67% to 6,968.60
• Kospi increased 7.52 points or 0.31% to 2,424.48
• SENSEX decreased 289.31 points or 0.50% to 57,925.28
• Nifty50 decreased 75.00 points or -0.44% to 17,076.90

The major Asian currency markets had a mixed day today:

• AUDUSD decreased 0.00005 or -0.01% to 0.66815
• NZDUSD increased 0.00351 or 0.56% to 0.62551
• USDJPY decreased 0.99 or -0.75% to 130.450
• USDCNY decreased 0.03245 or -0.47% to 6.82875

Precious Metals:

• Gold increased 27.38 USD/t oz. or 1.39% to 1,996.96
• Silver increased 0.052 USD/t. oz or 0.23% to 23.078

Some economic news from last night:

Hong Kong:

Interest Rate Decision increased from 5.00% to 5.25%

Some economic news from today:

India:

M3 Money Supply increased from 9.5% to 9.6%

Hong Kong ：

CPI (YoY) (Feb) decreased from 2.40% to 1.70%

Singapore：

Core CPI (YoY) (Feb) remain the same at 5.50%

CPI (YoY) (Feb) decreased from 6.6% to 6.3%

EUROPE/EMEA:

The Bank of England has raised interest rates by a quarter of a percentage point to 4.25% in its 11th consecutive rate hike to combat rising inflation. The move comes after UK consumer prices surged by 10.4% in February, mainly due to rising food prices and the cost of visiting restaurants and hotels. Despite recent turmoil in the banking sector, the central bank has continued to raise rates. However, employment growth has been stronger than expected, and household disposable income is expected to remain flat after the government extended its support for energy bills. Other central banks such as the European Central Bank, the US Federal Reserve, and the Swiss National Bank have also raised interest rates in the past week.

The major Europe stock markets had a mixed day:

• CAC 40 increased 8.13 points or 0.11% to 7,139.25
• FTSE 100 decreased 67.24 points or -0.89% to 7,499.60
• DAX 30 decreased 5.80 points or -0.04% to 15,210.39

The major Europe currency markets had a mixed day today:

• EURUSD decreased 0.00201 or -0.19% to 1.08349
• GBPUSD increased 0.00213 or 0.17% to 1.22853
• USDCHF decreased 0.00191 or -0.21% to 0.91569

Some economic news from Europe today:

Swiss:

SNB Interest Rate Decision (Q1) increased from 1.00% to 1.50%

UK:

BoE Interest Rate Decision (Mar) increased from 4.00% to 4.25%

US/AMERICAS:

Treasury Secretary Janet Yellen announced that the government is prepared to impliment federal emergency actions in the future in the event of a banking failure. “We have used important tools to act quickly to prevent contagion. And they are tools we could use again,” Yellen said this Thursday referring to the actions taken in the wake of Silicon Valley Bank and Signature Bank failing. Yellen reiterated that the American banking system is safe. Some are criticizing the governments actions to insure all deposits and blame the failed banks for taking excessive risks.

US Market Closings:

• Dow advanced 75.14 points or 0.23% to 32,105.25
• S&P 500 advanced 11.75 points or 0.3% to 3,948.72
• Nasdaq advanced 117.44 points or 1.01% to 11,787.4
• Russell 2000 declined 7.07 points or -0.41% to 1,720.29

Canada Market Closings:

• TSX Composite declined 72.86 points or -0.37% to 19,459.92
• TSX 60 declined 4.89 points or -0.42% to 1,168.11

Brazil Market Closing:

• Bovespa declined 2,294.29 points or -2.29% to 97,926.34

ENERGY:

The oil markets had a mixed day today:

• Crude Oil decreased 1.409 USD/BBL or -1.99% to 69.491
• Brent decreased 1.187 USD/BBL or -1.55% to 75.503
• Natural gas decreased 0.0246 USD/MMBtu or -1.13% to 2.1464
• Gasoline increased 0.0007 USD/GAL or 0.03% to 2.5939
• Heating oil decreased 0.0552 USD/GAL or -2.01% to 2.6851

The above data was collected around 15:47 EST on Thursday

• Top commodity gainers: Rice (1.77%), Canola (2.11%), Aluminum (1.95%) and Cheese (1.87%)
• Top commodity losers: Lumber (-5.49%), Coffee (-2.08%), Palm Oil (-2.59%) and Heating Oil (-2.01%)

The above data was collected around 15:53 EST Thursday.

BONDS:

Japan 0.301% (-2.6bp), US 2’s 3.80% (-0.182%), US 10’s 3.3893% (-11.07bps); US 30’s 3.67% (-0.032%), Bunds 2.146% (-18.3bp), France 2.707% (-14.4bp), Italy 4.052% (-12.2bp), Turkey 11.91% (+5bp), Greece 4.213% (-5.1bp), Portugal 3.072% (-13.9bp); Spain 3.216% (-15.4bp) and UK Gilts 3.361% (-8.9bp).

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