Market Talk – June 15, 2023

ASIA:

China’s inflation remained close to zero in May, sparking concerns on a falling spiral in prices and prompting the central bank to come out to downplay worries on the economic outlook. The consumer price index rose 0.2% from a year earlier, the National Bureau of Statistics said last Friday, in line with forecasts and up from 0.1% in April. Producer prices declined 4.6% on the back of lower commodity prices and weak domestic and foreign demand.

The major Asian stock markets had a mixed day today:

• NIKKEI 225 decreased 16.93 points or -0.05% to 33,485.49
• Shanghai increased 23.99 points or 0.74% to 3,252.98
• Hang Seng increased 420.50 points or 2.17% to 19,828.92
• ASX 200 increased 13.60 points or 0.19% to 7,175.30
• Kospi decreased 10.54 points or -0.40% to 2,608.54
• SENSEX decreased 310.88 points or -0.49% to 62,917.63
• Nifty50 decreased 67.80 points or -0.36% to 18,688.10

The major Asian currency markets had a mixed day today:

• AUDUSD increased 0.00926 or 1.36% to 0.68856
• NZDUSD increased 0.00342 or 0.55% to 0.62382
• USDJPY increased 0.167 or 0.12% to 140.257
• USDCNY decreased 0.05590 or -0.78% to 7.11955

Precious Metals:

• Gold increased 15.19 USD/t oz. or 0.78% to 1,958.18
• Silver decreased 0.042 USD/t. oz or -0.17% to 23.886

Some economic news from last night:

China:

Fixed Asset Investment (YoY) (May) decreased from 4.7% to 4.0%

Industrial Production (YoY) (May) decreased from 5.6% to 3.5%

Chinese Industrial Production YTD (YoY) (May) remain the same at 3.6%

Chinese Unemployment Rate (May) remain the same at 5.2%

Japan:

Adjusted Trade Balance increased from -1.04T to -0.78T

Exports (YoY) (May) decreased from 2.6% to 0.6%

Trade Balance (May) decreased from -432.3B to -1,372.5B

Australia:

Employment Change (May) increased from -4.0K to 75.9K

Full Employment Change (May) increased from -28.6K to 61.7K

Unemployment Rate (May) decreased from 3.7% to 3.6%

New Zealand:

GDP (QoQ) (Q1) increased from -0.7% to -0.1%

Some economic news from today:

Japan:

Tertiary Industry Activity Index (MoM) increased from -1.5% to 1.2%

EUROPE/EMEA:

The European Central Bank pressed ahead with another interest rate hike on Thursday, aiming to crush inflation that is driving up the cost of groceries, utility bills and summer vacations even after the US Federal Reserve took a break from its own string of increases. The boost of a quarter-percentage point, to 3.5 per cent, is the eighth straight increase since July 2022 for the 20 countries that use the euro currency. That is an unprecedentedly swift campaign to tighten the flow of credit to the economy as the bank seeks to return inflation to its target of 2 per cent from 6.1 per cent. The ECB says higher rates are being “transmitted forcefully” and “are gradually having an impact across the economy.” Its own projections acknowledge that controlling inflation will take months longer even as the rate has fallen from a double-digit peak late last year.

The major Europe stock markets had a mixed day today:

• CAC 40 decreased 37.62 points or -0.51% to 7,290.91
• FTSE 100 increased 25.52 points or 0.34% to 7,628.26
• DAX 30 decreased 20.67 points or -0.13% to 16,290.12

The major Europe currency markets had a mixed day today:

• EURUSD increased 0.01169 or 1.08% to 1.09479
• GBPUSD increased 0.01232 or 0.97% to 1.27842
• USDCHF decreased 0.00985 or -1.09% to 0.89115

Some economic news from Europe today:

Swiss:

PPI (MoM) (May) decreased from 0.2% to -0.3%

France:

CPI NSA (YoY) (May) remain the same at 5.1%

CPI NSA (MoM) (May) remain the same at -0.10%

French CPI (MoM) (May) decreased from 0.6% to -0.1%

French HICP (MoM) (May) decreased from 0.7% to -0.1%

Euro Zone:

Trade Balance (Apr) decreased from 23.6B to -11.7B

Deposit Facility Rate (Jun) increased from 3.25% to 3.50%

ECB Marginal Lending Facility increased from 4.00% to 4.25%

ECB Interest Rate Decision (Jun) increased from 3.75% to 4.00%

 US/AMERICAS:

The Producer Price Index (PPI) for final demand decreased by 0.3% in May 2023, following an unrevised 0.2% rise in April. The PPI increased 1.1% in the 12 months through May, which was the smallest year-on-year rise since December 2020 and followed a 2.3% increase in April. The annual PPI rate is moderating as last year’s surge drops out of the calculation. The decline in the PPI is mainly due to the index for final demand energy, which dropped 6.8%, and prices for final demand foods moved down 1.3%.

US Market Closings:

• Dow advanced 428.73 points or 1.26% to 34,408.06
• S&P 500 advanced 53.25 points or 1.22% to 4,425.84
• Nasdaq advanced 156.34 points or 1.15% to 13,782.82
• Russell 2000 advanced 15.18 points or 0.81% to 1,889.28

Canada Market Closings:

• TSX Composite advanced 12.26 points or 0.06% to 20,027.35
• TSX 60 advanced 1.1 points or 0.09% to 1,205.45

Brazil Market Closing:

• Bovespa advanced 152.23 points or 0.13% to 119,221.00

ENERGY:

The oil markets had a green day today:

• Crude Oil increased 2.298 USD/BBL or 3.37% to 70.568
• Brent increased 2.342 USD/BBL or 3.20% to 75.542
• Natural gas increased 0.2163 USD/MMBtu or 9.24% to 2.5583
• Gasoline increased 0.0948 USD/GAL or 3.71% to 2.6494
• Heating oil increased 0.1278 USD/GAL or 5.42% to 2.4855

The above data was collected around 16:21 EST on Thursday

• Top commodity gainers: Natural Gas (9.24%), Heating Oil (5.42%), HRC Steel (4.11%) and Wheat (4.83%)
• Top commodity losers: Cheese (-0.85%), Cotton (-1.44%), Butter (-1.52%) and Lean Hogs (-0.95%)

The above data was collected around 16:28 EST Thursday.

BONDS:

Japan 0.426% (-0.5bp), US 2’s 4.64% (-0.065%), US 10’s 3.7184% (-7.96bps); US 30’s 3.84% (-0.041%), Bunds 2.495% (+5bp), France 3.015% (+4.4bp), Italy 4.125% (+3.3bp), Turkey 16.86% (-23bp), Greece 3.866% (+9.2bp), Portugal 3.176% (+3.7bp); Spain 3.433% (+2.7bp) and UK Gilts 4.383% (-0.9bp).        

The post Market Talk – June 15, 2023 first appeared on Armstrong Economics.