Market Talk – August 8, 2023

ASIA:

Stripe, a US-based payments processor, has released a report discussing how digital trade is reshaping the global economy and how businesses are responding. The report is based on transaction data from Stripe’s platform and surveys of business leaders and consumers across nine countries. It highlights how technology is diversifying international trade routes and increasing opportunities for businesses in Singapore. Despite challenges, both businesses and consumers are optimistic about expanding internationally. 84% of businesses plan to expand to other countries by 2025, with 30% expecting significant international growth by 2028. Singaporean businesses find it easier to operate internationally now compared to 2018. Consumers are also enthusiastic, with 84% willing to buy physical goods from other countries and 74% open to purchasing digital services internationally.

The major Asian stock markets had a mixed day today:

• NIKKEI 225 increased 122.73 points or 0.38% to 32,377.29
• Shanghai decreased 8.21 points or -0.25% to 3,260.62
• Hang Seng decreased 353.75 points or -1.81% to 19,184.17
• ASX 200 increased 1.90 points or 0.03% to 7,311.10
• Kospi decreased 6.73 points or -0.26% to 2,573.98
• SENSEX decreased 106.98 points or -0.16% to 65,846.50
• Nifty50 decreased 26.45 points or -0.13% to 19,570.85

The major Asian currency markets had a mixed day today:

• AUDUSD decreased 0.00506 or -0.77% to 0.65214
• NZDUSD decreased 0.00547 or -0.90% to 0.60493
• USDJPY increased 0.838 or 0.59% to 143.328
• USDCNY increased 0.03575 or 0.50% to 7.23745

Precious Metals:

• Gold decreased 10.97 USD/t oz. or -0.57% to 1,925.42
• Silver decreased 0.424 USD/t. oz or -1.83% to 22.726

Some economic news from last night:

China:

Exports (YoY) (Jul) decreased from -12.4% to -14.5%

Imports (YoY) (Jul) decreased from -6.8% to -12.4%

Trade Balance (USD) (Jul) decreased from 70.62B to 80.60B

Japan；

Household Spending (MoM) (Jun) increased from -1.1% to 0.9%

Household Spending (YoY) (Jun) decreased from -4.0% to -4.2%

Adjusted Current Account (Jun) increased from 1.70T to 234.59T

Current Account n.s.a. (Jun) decreased from 1.862T to 1.509T

Australia:

NAB Business Confidence (Jul) increased from -1 to 2

No economic news from today:

EUROPE/EMEA:

Bellway, a British housebuilder, has announced plans for job cuts and potential closure of two divisions due to structural changes amidst a slowdown in house building and sales. The housing market in the UK has been negatively impacted by rising mortgage rates, leading to decreased demand. The recent interest rate increase by the Bank of England to 5.25% from 5% has contributed to this challenge. Bellway, employing around 3,000 people, has not specified the exact number of job losses but mentioned that only a limited number of positions will be affected.

The major Europe stock markets had a negative day today:

• CAC 40 decreased 50.29 points or -0.69% to 7,269.47
• FTSE 100 decreased 27.07 points or -0.36% to 7,527.42
• DAX 30 decreased 175.83 points or -1.10% to 15,774.93

The major Europe currency markets had a mixed day today:

• EURUSD decreased 0.0048 or -0.44% to 1.09540
• GBPUSD decreased 0.0045 or -0.35% to 1.27390
• USDCHF increased 0.00322 or 0.37% to 0.87542

Some economic news from Europe today:

Germany:

German CPI (YoY) (Jul) decreased from 6.4% to 6.2%

German CPI (MoM) (Jul) remain the same at 0.3%

UK:

Mortgage Rate (GBP) (Jul) increased from 7.54% to 7.68%

US/AMERICAS:

According to recent reports, credit card balances in the US have surpassed $1 trillion for the first time, with balances up almost 20% from a year ago. The Federal Reserve Bank of New York reported that total credit card debt stood at $986 billion in the first quarter of 2023, unchanged from the record hit at the end of 2022. The average credit card interest rate offered in the US over the last three months of 2022 stood at 21.6%, according to WalletHub, a jump from about 18% a year prior. The rise in credit card rates is attributed to an aggressive series of interest rate hikes imposed by the Federal Reserve. The increase in credit card balances is a cause for concern, as it could lead to a rise in defaults and a potential recession. The tightening of credit standards by banks could also contribute to a slowdown in the economy.

US Market Closings:

• Dow declined 158.38 points or -0.45% to 35,314.75
• S&P 500 declined 19.12 points or -0.42% to 4,499.32
• Nasdaq declined 110.07 points or -0.79% to 13,884.32
• Russell 2000 declined 11.52 points or -0.59% to 1,947.42

Canada Market Closings:

• TSX Composite declined 30.06 points or -0.15% to 20,205.98
• TSX 60 declined 1.93 points to -0.16% to 1,209.29

Brazil Market Closing:

• Bovespa declined 289.26 points or -0.24% to 119,090.24

ENERGY:

The oil markets had a mixed day today:

• Crude Oil increased 0.472 USD/BBL or 0.58% to 82.412
• Brent increased 0.431 USD/BBL or 0.51% to 85.771
• Natural gas increased 0.0512 USD/MMBtu or 1.88% to 2.7762
• Gasoline decreased 0.0008 USD/GAL or -0.03% to 2.8036
• Heating oil increased 0.0438 USD/GAL or 1.45% to 3.0593

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

• Top commodity gainers: Natural Gas (1.88%), Heating Oil (1.45%), HRC Steel (1.21%) and Lumber (1.27%)
• Top commodity losers: Palm Oil (-2.09%), Cocoa (-4.86%), Orange Juice (-2.26%) and Platinum (-2.19%)

The above data was collected around 13:18 EST Tuesday.

BONDS:

Japan 0.603% (-2.2bp), US 2’s 4.76% (-0.0003%), US 10’s 4.022% (-5.6bps); US 30’s 4.20% (-0.054%), Bunds 2.436% (-12.5bp), France 2.999% (-13bp), Italy 4.119% (-14bp), Turkey 18.11% (+46bp), Greece 3.812% (-7.9bp), Portugal 3.224% (-9.7bp); Spain 3.503% (-12.9bp) and UK Gilts 4.385% (-7.4bp).