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Market Talk – May 11, 2022


ASIA:

China’s consumer and producer prices rose more than expected in April, according to data from the National Bureau of Statistics released Wednesday. The consumer price index rose by 2.1% last month from a year ago, boosted by a surge in energy and fresh vegetable costs. The reading topped expectations for a 1.8% rise forecast by a Reuters poll. April’s figure was also the highest since November’s 2.3% print and well above the 18-month average of 0.9% consumer price inflation. China’s official CPI target for 2022 is “around 3%.”

India exported a record 1.4 million tonnes of wheat in April, four trade sources said, providing some relief to grain markets as buyers scramble for alternatives to Black Sea supplies hit hard by the war in Ukraine. Buyers from Asia and the Middle East are purchasing Indian wheat, as it is cheaper than alternatives, a New Delhi based dealer with a global trading firm said. India has exported wheat to South Asia, Southeast Asia, the Middle East, Europe, and North Africa. As supplies dropped from Ukraine and Russia, which together used to account for about 29% of global wheat exports, top wheat importer Egypt agreed for the first time to purchase the grain from India. In April, Indian traders signed wheat export deals at between $295 and $340 a tonne free on board.

 

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 increased 46.54 points or 0.18% to 26,213.64
  • Shanghai increased 22.86 points or 0.75% to 3,058.70
  • Hang Seng increased 190.88 points or 0.97% to 19,824.57
  • ASX 200 increased 13.50 points or 0.19% to 7,064.70
  • Kospi decreased 4.29 points or -0.17% to 2,592.27
  • SENSEX decreased 276.46 points or -0.51% to 54,088.39
  • Nifty50 decreased 72.95 points or -0.45% to 16,167.10

 

The major Asian currency markets had a mixed day today:

  • AUDUSD increased 0.0028 or 0.40% to 0.69639
  • NZDUSD increased 0.0027 or 0.43% to 0.63170
  • USDJPY decreased 0.38 or -0.29% to 129.965
  • USDCNY increased 0.00057 or 0.01% to 6.74701

 

Precious Metals:

  • Gold increased 15.00 USD/t oz. or 0.82% to 1,853.08
  • Silver increased 0.382 USD/t. oz or 1.80% to 21.622

 

 

Some economic news from last night:

China:

CPI (MoM) (Apr) decreased from 0.6% to 0.4%

CPI (YoY) (Apr) increased from 1.5% to 2.1%

PPI (YoY) (Apr) decreased from 8.3% to 8.0%

Japan:

Foreign Reserves (USD) (Apr) decreased from 1,356.1B to 1,322.2B

South Korea:

Unemployment Rate (Apr) remain the same at 2.7%

Australia:

Westpac Consumer Sentiment (May) decreased from -0.9% to -5.6%

 

Some economic news from today

Japan:

Coincident Indicator (MoM) (Mar) decreased from 0.5% to 0.2%

Leading Index (MoM) (Mar) increased from -1.2% to 0.9%

 

 

 

EUROPE/EMEA:

Britain on Wednesday rejected European Union proposals to resolve a standoff over post-Brexit trade rules for Northern Ireland, saying it would not shy away from taking direct action in a move Ireland said would trigger legal action by Brussels. Prime Minister Boris Johnson’s government agreed to a protocol that instead created a customs border in the sea between Northern Ireland and the rest of the UK, but it now says the required bureaucracy is intolerable.

Ukraine said on Tuesday its forces had recaptured villages from Russian troops north and northeast of the city of Kharkiv, pressing a counter-offensive that could signal a shift in the war’s momentum and jeopardize Russia’s main advance. In Washington, top US intelligence officials said the war was at a stalemate. President Vladimir Putin appeared to be preparing for a long conflict, and a Russian victory in Ukraine’s eastern Donbas region might not end the war, Director of National Intelligence Avril Haines said.

 

The major Europe stock markets had a green day:

 

  • CAC 40 increased 152.82 points or 2.50% to 6,269.73
  • FTSE 100 increased 104.44 points or 1.44% to 7,347.66
  • DAX 30 increased 293.90 points or 2.17% to 13,828.64

 

 

The major Europe currency markets had a mixed day today:

  • EURUSD increased 0.0001 or 0.01% to 1.05327
  • GBPUSD decreased 0.0018 or -0.15% to 1.22915
  • USDCHF decreased 0.00423 or -0.42% to 0.99173

 

Some economic news from Europe today:

Germany:

German CPI (MoM) (Apr) decreased from 2.5% to 0.8%

German CPI (YoY) (Apr) increased from 7.3% to 7.4%

German HICP (MoM) (Apr) decreased from 2.5% to 0.7%

German HICP (YoY) (Apr) increased from 7.6% to 7.8%

 

US/AMERICAS:

The US inflation data for April came in at 8.3%. The figure dipped slightly below March’s record high of 8.5%, but is obviously concerning to the Fed as it could take years for the rate to drop to their 2% target. The Federal Reserve said that a 50 basis point increase is on the table for the next few meetings, as calming inflation is of utmost concern. Not accounting for energy or food, core CPI spiked to 6.2%.

The declining buying power of the dollar is hurting American workers. Real wages fell 0.1% last month and have dropped 2.6% over the past year. Although hourly earnings are up 5.5% for the year and 0.3% for the month, the rise is not enough to combat the price spike.

US Market Closings:

  • Dow declined 326.63 points or -1.02% to 31,834.11
  • S&P 500 declined 65.87 points or -1.65% to 3,935.18
  • Nasdaq declined 373.43 points or -3.18% to 11,364.24
  • Russell 2000 declined 43.65 points or -2.48% to 1,718.14

s

Canada Market Closings:

  • TSX Composite declined 52.81 points or -0.27% to 19,837.25
  • TSX 60 declined 2.71 points or -0.22% to 1,206.6 points

 

Brazil Market Closing:

  • Bovespa advanced 1,286.96 points or 1.25% to 104,396.9

 

 

ENERGY:

 

The oil markets had a green day today:

 

  • Crude Oil increased 6.3 USD/BBL or 6.32% to 106.0600
  • Brent increased 6.05 USD/BBL or 5.94% to 107.95
  • Natural gas increased 0.219 USD/MMBtu or 2.97% to 7.6040
  • Gasoline increased 0.147 USD/GAL or 4.15% to 3.6885
  • Heating oil increased 0.0987 USD/GAL or 2.51% to 4.0309

 

The above data was collected around 13:04 EST on Wednesday

 

  • Top commodity gainers: Crude Oil (6.32%) and Brent (5.94%), Gasoline (4.15%), Bitumen (3.37%)
  • Top commodity losers: Steel (-1.43%), Palladium (-1.90%), Rhodium (-3.98%) and Orange Juice (-5.19%)

 

The above data was collected around 13:14 EST on Wednesday.

 

 

BONDS:

 

Japan 0.247%(-0.2bp), US 2’s 2.65% (+0.033%), US 10’s 2.9226% (-7.02bps); US 30’s 3.05% (-0.078%), Bunds 0.964% (-3.9bp), France 1.471% (-7.8bp), Italy 2.894% (-11.8bp), Turkey 22.13% (-16bp), Greece 3.471% (-3.6bp), Portugal 2.090% (-7.7bp); Spain 2.029% (-8.1bp) and UK Gilts 1.8020% (-4.8bp).

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