Market Talk – May 24, 2023

ASIA:

The major Asian stock markets had a mixed day today:

• NIKKEI 225 decreased 129.05 points or -0.42% to 30,957.77
• Shanghai decreased 50.23 points or -1.52% to 3,246.24
• Hang Seng decreased 246.92 points or -1.25% to 19,431.25
• ASX 200 decreased 3.40 points or -0.05% to 7,259.90
• Kospi increased 10.47 points or 0.41% to 2,567.55
• SENSEX increased 18.11 points or 0.03% to 61,981.79
• Nifty50 increased 33.60 points or 0.18% to 18,348.00

The major Asian currency markets had a mixed day today:

• AUDUSD decreased 0.00331 or -0.50% to 0.66199
• NZDUSD decreased 0.0029 or -0.46% to 0.62560
• USDJPY increased 0.163 or 0.12% to 138.763
• USDCNY increased 0.01681 or 0.24% to 7.06391

Precious Metals:

• Gold decreased 2.03 USD/t oz. or -0.10% to 1,967.40
• Silver decreased 0.236 USD/t. oz or -1.00% to 23.424

Some economic news from last night:

Japan:

Services PMI increased from 55.4 to 56.3

Some economic news from today:

Japan:

BoJ Core CPI (YoY) increased from 2.9% to 3.0%

Singapore:

Core CPI (YoY) (Apr) remain the same at 5.00%

CPI (YoY) (Apr) increased from 5.5% to 5.7%

EUROPE/EMEA:

European stock markets experienced a new wave of selling as several factors negatively impacted investor sentiment. The lack of progress in U.S. debt ceiling negotiations, a significant increase in UK core inflation, and losses in luxury brands contributed to the decline in risk sentiment. The Europe-wide STOXX 600 index dropped by 1.2%, reaching its lowest point in almost three weeks, with all regional markets experiencing losses. Real estate stocks were hit the hardest, falling by 2.1%, as government bond yields rose following the UK inflation data. Additionally, UK homebuilders led the declines on the FTSE 100 index after the data revealed a substantial surge in core price growth, increasing expectations for more interest rate hikes from the Bank of England.

German business morale declined more than anticipated in May, primarily driven by a significant drop in future expectations. This indicates ongoing economic challenges for Europe’s largest economy. Meanwhile, luxury stocks across Europe experienced a 1.0% decrease, reaching a seven-week low. The sector has been facing a continued sell-off despite its strong performance this year, which had contributed to positive returns in broader European markets.

The major Europe stock markets had a negative day today:

• CAC 40 decreased 99.45 points or -1.33% to 7,378.71
• FTSE 100 decreased 8.04 points or -0.10% to 7,762.95
• DAX 30 decreased 71.13 points or -0.44% to 16,152.86

The major Europe currency markets had a mixed day today:

• EURUSD decreased 0.0043 or -0.40% to 1.07680
• GBPUSD decreased 0.00239 or -0.19% to 1.24131
• USDCHF increased 0.00397 or 0.44% to 0.90167

Some economic news from Europe today:

France:

French Manufacturing PMI (May) increased from 45.6 to 46.1

French Services PMI (May) decreased from 54.6 to 52.8

Germany:

German Manufacturing PMI (May) decreased from 44.5 to 42.9

German Services PMI (May) increased from 56.0 to 57.8

UK:

Composite PMI decreased from 54.9 to 53.9

Manufacturing PMI decreased from 47.8 to 46.9

Services PMI decreased from 55.9 to 55.1

Euro Zone:

Manufacturing PMI (May) decreased from 45.8 to 44.6

S&P Global Composite PMI (May) decreased from 54.1 to 53.3

Services PMI (May) decreased from 56.2 to 55.9

US/AMERICAS:

US Treasury Secretary Janet Yellen has reiterated that June 1 is a “hard deadline” for raising the federal debt limit. Yellen warned that there would be hard choices to make about payments to Americans if Congress failed to raise the $31.4 trillion debt ceiling before Treasury ran out of cash. She indicated that the government may be unable to pay all of its bills possibly as soon as June 1. Yellen is coordinating with the White House at a senior level, with several meetings between the department and the White House happening weekly, according to administration officials. If Congress cannot reach an agreement on the ceiling, economists warn of dire consequences, including default.

US Market Closings:

• Dow declined 231.07 points or -0.69% to 33,055.51
• S&P 500 declined 47.05 points or -1.12% to 4,145.58
• Nasdaq declined 160.53 points or -1.26% to 12,560.25
• Russell 2000 declined 7.67 points or -0.43% to 1,787.71

Canada Market Closings:

• TSX Composite declined 205.05 points or -1.01% to 20,146.01
• TSX 60 declined 14.45 points or -1.18% to 1,211.77

Brazil Market Closing:

• Bovespa declined 284.59 points or -0.26% to 109,928.53

ENERGY:

The oil markets had a mixed day today:

• Crude Oil increased 1.401 USD/BBL or 1.95% to 73.451
• Brent increased 1.437 USD/BBL or 1.89% to 77.427
• Natural gas decreased 0.0637 USD/MMBtu or -2.65% to 2.3363
• Gasoline increased 0.0301 USD/GAL or 1.14% to 2.6790
• Heating oil increased 0.0096 USD/GAL or 0.41% to 2.3760

The above data was collected around 12:10 EST on Tuesday

• Top commodity gainers: Crude Oil (1.95%), Bitumen (2.32%), Oat (2.79%) and Orange Juice (4.85%)
• Top commodity losers: Zinc (-2.55%), Palladium (-2.13%), Steel (-1.82%) and Natural Gas (-2.65%)

The above data was collected around 12:22 EST Tuesday.

BONDS:

Japan 0.415% (+2.8bp), US 2’s 4.37% (+0.047%), US 10’s 3.7187% (-0.03bps); US 30’s 3.97% (-0.0001%), Bunds 2.46% (+0.9bp), France 3.039% (+0.2bp), Italy 4.318% (+0.6bp), Turkey 8.87% (+6bp), Greece 3.906% (+0.5bp), Portugal 3.262% (+2bp); Spain 3.512% (+0.5bp) and UK Gilts 4.155% (+8.9bp).

The post Market Talk – May 24, 2023 first appeared on Armstrong Economics.