Market Talk – May 7, 2021


ASIA:

The International Monetary Fund said on Thursday the recent jump in COVID-19 cases in India posed downside risks to the Fund’s April forecast for 12.5% growth in India’s economic output in fiscal years 2021 and 2022. The IMF will revisit that forecast when it issued a fresh World Economic Outlook in July, IMF spokesman Gerry Rice told reporters at a regular briefing, but gave no further details.

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 increased 26.45 points or 0.09% to 29,357.82
  • Shanghai decreased 22.41 points or -0.65% to 3,418.87
  • Hang Seng decreased 26.81 points or -0.09% to 28,610.65
  • ASX 200 increased 19.10 points or 0.27% to 7,080.80
  • Kospi increased 18.46 points or 0.58% to 3,197.20
  • SENSEX increased 256.71 points or 0.52% to 49,206.47
  • Nifty50 increased 98.35 points or 0.67% to 14,823.15

 

 

The major Asian currency markets had a mixed day today:

  • AUDUSD increased 0.0062 or 0.79% to 0.78494
  • NZDUSD increased 0.0050 or 0.69% to 0.72828
  • USDJPY decreased 0.4490 or -0.41% to 108.61
  • USDCNY decreased 0.0471 or -0.73% to 6.41788

 

Precious Metals:

  • Gold increased 16.22 USD/t oz. or 0.89% to 1,831.40
  • Silver increased 0.14 USD/t. oz or 0.49% to 27.430

 

Some economic news from last night:

China:

Caixin Services PMI (Apr) increased from 54.3 to 56.3

Japan:

Overall wage income of employees (Mar) increased from -0.4% to 0.2%

Overtime Pay (YoY) (Mar) increased from -9.10% to -6.20%

Average Cash Earnings (YoY) increased from -0.4% to 0.2%

Monetary Base (YoY) increased from 20.8% to 24.3%

Services PMI (Apr) increased from 48.3 to 49.5

South Korea:

Current Account (Mar) decreased from 7.94B to 7.82B

Australia:

AIG Services Index (Apr) increased from 58.7 to 61.0

 

Some economic news from today:

China:

Exports (YoY) (Apr) increased from 30.6% to 32.3%

FX Reserves (USD) (Apr) increased from 3.170T to 3.198T

Imports (YoY) (Apr) increased from 38.1% to 43.1%

Trade Balance (USD) (Apr) increased from 13.80B to 42.86B

Hong Kong:

Foreign Reserves (USD) (Apr) decreased from 491.40B to 490.60B

India:

Bank Loan Growth increased from 5.3% to 5.7%

Deposit Growth decreased from 10.9% to 10.3%

FX Reserves, USD increased from 584.11B to 588.02B

Indonesia:

FX Reserves (USD) (Apr) increased from 137.10B to 138.80B

Singapore:

Foreign Reserves USD (MoM) (Apr) increased from 379.8B to 385.7B

 

EUROPE/EMEA:

Brussels has rejected the UK proposal to ease issues surrounding the Northern Ireland protocol. The main issue lies in the fact that the EU has refused to take a more flexible approach on animal health standards and food safety checks. Under the protocol, Northern Ireland remains within the EU single market and applies some of its customs checks. Due to this policy, businesses have experienced trade issues due to all the added checks. According to an article on express.co.uk¸ the UK’s Brexit minister and his EU counterpart, Maros Sefcovic, may meet next week to discuss the issues around Northern Ireland.

The major Europe stock markets had a green day:

  • CAC 40 increased 28.42 points or 0.45% to 6,385.51
  • FTSE 100 increased 53.54 points or 0.76% to 7,129.71
  • DAX 30 increased 202.91 points or 1.34% to 15,399.65

 

The major Europe currency markets had a mixed day today:

  • EURUSD increased 0.0101 or 0.83% to 1.21657
  • GBPUSD increased 0.0104 or 0.75% to 1.3999
  • USDCHF decreased 0.0068 or -0.75% to 0.90091

 

Some economic news from Europe today:

Swiss:

Unemployment Rate n.s.a. (Apr) decreased from 3.4% to 3.3%

Unemployment Rate s.a. (Apr) decreased from 3.3% to 3,1%

Germany:

Gemran Current Account Balance n.s.a (Mar) increased from 18.8B to 30.2B

German Exports (MoM) (Mar) increased from 1.0% to 1.2%

German Imports (MoM) (Mar) increased from 3.6% to 6.5%

German Industrial Production (MoM) (Mar) increased from -1.9% to 2.5%

German Trade Balance (Mar) decreased from 18.9B to 14.3B

France:

French Current Account (Mar) decreased from -2.20B to -2.90B

French Exports (Mar) increased from 39.0B to 40.0B

French Imports (Mar) increased from 44.1B to 46.1B

French Industrial Production (MoM) (Mar) increased from -4.8% to 0.8%

French Non-Farm Payrolls (QoQ) (Q1) increased from -0.1% to 0.3%

French Reserve Assets Total (Apr) increased from 182,839.0M to 183,428.0M

French Trade Balance (Mar) decreased from -5.1B to -6.1B

Spain:

Spanish Industrial Production (YoY) (Mar) increased from -2.3% to 12.4%

Italy:

Italian Retail Sales (MoM) (Mar) decreased from 5.9% to -0.1%

Italian Retail Sales (YoY) (Mar) increased from -5.7% to 22.9%

UK:

Construction PMI (Apr) decreased from 61.7 to 61.6

 

US/AMERICAS:

April’s jobless report came as a disappointment after the unemployment rate rose to 6.1% from an estimation of 5.8%. Nonfarm payrolls added an additional 266,000 jobs, but analysts had expected the rate to be nearly four times that amount. March’s figure was also revised down to 770,000 compared to the original estimate of 916,000. February’s data saw some improvement from 468,000 revised to 536,000.

Secretary of Labor Marty Walsh was undeterred by the unemployment data that was released today. “Under normal circumstances — and certainly we are not living in normal circumstances — a 266,000 job gain a month is a good number. Unfortunately, we are still in the midst of a pandemic,” Walsh noted, hinting that expectations may have been too high. “If you look back on the last three months, the United States economy has added 500,000 new jobs per month as compared to the previous three months where it was 60,000. So we are definitely going in the right direction but we still have a ways to go, there’s no question about it. We are still dealing with a pandemic,” he stated. Walsh also believes unemployment benefits are still warranted and does not believe the added pay is discouraging people from returning to the workforce.

 

The US Chamber of Commerce, on the other hand, is blaming the additional unemployment benefits for April’s discouraging data. “One step policymakers should take now is ending the $300 weekly supplemental unemployment benefit. Based on the Chamber’s analysis, the $300 benefit results in approximately one in four recipients taking home more in unemployment than they earned working.,” the US Chamber of Commerce stated this Friday. The group believes that the added pay is “dampening” what should have been a strong jobs report. Others are wondering if unlivable wages are to blame for nearly 25% of unemployment recipients earning more while out of the workforce.

US Market Closings:

  • Dow advanced 229.23 points or 0.66% to 34,777.76
  • S&P 500 advanced 30.98 points or 0.74% to 4,232.6
  • Nasdaq  advanced 119.39 points or 0.88% to 13,752.24
  • Russell 2000 advanced 30.21 points or 1.35% to 2,271.63

 

Canada Market Closings:

  • TSX Composite advanced 181.76 points or 0.94% to 19,472.74
  • TSX 60 advanced 10.68 points or 0.93% to 1,161.59

 

Brazil Market Closing:

  • Bovespa advanced 1,903.48 points or 1.59% to 121,824.09

ENERGY:

 

The oil markets had a green day today:

 

  • Crude Oil increased 0.10 USD/BBL or 0.15% to 64.8100
  • Brent increased 0.07 USD/BBL or 0.10% to 68.1600
  • Natural gas increased 0.03 USD/MMBtu or 1.06% to 2.9590
  • Gasoline increased 0.02 USD/GAL or 0.79% to 2.1300
  • Heating oil increased 0.02 USD/GAL or 0.96% to 2.0086

 

 

The above data was collected around 15:55 EST on Friday

 

  • Top commodity gainers: Palm Oil (3.25%), Lumber (3.47%), Canola (4.21%) and Copper (2.96%)
  • Top commodity losers: Tin (-0.90%), Coal (-0.99%), Oat (-0.92%), and Orange Juice (-3.25%)

 

The above data was collected around 16:03 EST on Friday.

 

BONDS:

 

Japan 0.0880%(+0bp), US 2’s 0.14%(-0.012%), US 10’s 1.5824%(+2bps); US 30’s 2.27%(+0.034%), Bunds -0.2260% (+0bp), France 0.174% (+3bp), Italy 0.917% (+5bp), Turkey 17.37% (-3bp), Greece 1.001% (+3bp), Portugal 0.523% (+5bp); Spain 0.496% (+3bp) and UK Gilts 0.775% (-2bp).

 

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