Mai hui MHmarkets: 6, 2023 - Fundamental Reminder

☆ 07:50 BoJ Summary of Opinions (JUN)

Market Overview

Review of Global Market Trend

Last Friday, spot gold pulled up sharply before the U.S. market, pulling up $27 from the daily low, up to $1,937.50, and then fell back, failing to hold above the 1,930 mark, finally closing up 0.38% at $1,921.12 per ounce. Spot silver closed up 0.82% at $22.44 per ounce.

The U.S. dollar index rose sharply in European trading, and once up to the 103 mark, but failed to stand firm here, and finally closed up 0.46% at 102.86. U.S. Treasury yields were in a “V” pattern during the day, the U.S. 2-year Treasury yield once fell to a low of 4.696%, and then recovered some of the lost ground, and finally closed at 4.750%; 10-year U.S. bond yields fell from 3.8% above to 3.724%.

International crude oil fell before rising, WTI crude oil once fell to an intraday low of $67.40 during the day, but has since recovered most of its losses, finally closing down 0.03% at $69.47 per barrel; Brent crude oil closed up 0.2% at $74.34 per barrel.

The U.S. Dow closed down 0.65%, while the S&P 500 closed down 0.77% and the Nasdaq closed down 1.01%. The Nasdaq China Golden Dragon Index closed down 2.69%. The new energy vehicle sector was lower, with Xiaopeng Auto down 6.16%, Azera down 5.49%, Ideal Auto down 3.43% and Tesla down 3.03%.

 Major European stock indices closed lower across the board, with Germany's DAX30 index closing down 0.99%; Britain's FTSE 100 index closed down 0.54%; Europe's Stoxx 50 index closed down 0.76%.

Market Focus

1. The Wagner affair: German media broke the news that the German government believes that Wagner stopped the “rebellion” due to lack of support. Vladimir Putin expressed confidence in completing the objectives of the special military operation against Ukraine. Putin and the White Russian president spoke again on Sunday. Zelensky spoke with Biden, Russian media broke the news: Russia has informal contacts with NATO.

2. The armed conflict in many parts of Sudan has escalated and tends to expand and intensify.

3. The second round of the Greek parliamentary election counting work completed more than 97% of the New Democracy Party locked the victory and won the right to form a separate cabinet.

4. Japan intends to issue a new version of banknotes in July next year, updating the pattern after nearly 20 years.

5. Iran settles gas import debt issue with Iraqi side. Iran and Turkey hold talks on extending gas export agreement.

Geopolitical Situation

Conflict Situation

1. According to the Ukrainian state news agency: in the direction of Tavria (Tavria), Ukrainian forces have achieved partial success in offensive operations and improved their defensive tactical positions in the last 24 hours.

2. U.S. Secretary of State Blinken: Ukraine's military strategy may take weeks or months to complete.

3. According to RIA Novosti: In one day, the Ukrainian army lost 430 soldiers in the Donetsk direction.

4. According to Interfax: the Russian Defense Ministry said that Ukrainian troops continue to try to attack Donetsk and Zaporozhye regions and that 10 attacks by the Ukrainian army in the Bakhmut region were repulsed.

5. According to Sputnik: Russian Defense Ministry released a video of Russian troops destroying Ukrainian army fortifications in the direction of Kupyansk.

6. According to Ukrinform: the General Staff of the Ukrainian Armed Forces said that over the past day Russian troops lost 720 soldiers, as well as 6 tanks, 19 artillery systems and 12 tactical drones and other equipment.

7. According to The Guardian: Former British Army Chief of Staff Dennett warned of a possible new attack on Kiev from Belarus if the Wagner Group mercenaries follow its head, Prigozhin, into Belarus.

Wagner Affair

1. Asked a question about whether Putin still trusts Russian Defense Minister Shoigu, Russian Presidential Press Secretary Sergei Peskov said he was not aware of any changes in this regard.

2. According to Ukrainska Pravda, sources said Ukrainian intelligence services have hinted that Prigozhin may have been promised the dismissal of the Russian defense minister and several other military officials. The sources also expressed doubts about whether Wagner actually traveled to Belarus.

3. According to the German weekly Der Spiegel, the German government believes that Prigozhin stopped the “mutiny” due to lack of support.

4. Wagner's forces have completely left Russia's Lipetsk region.

5. All road traffic restrictions in Russia's Rostov region have been lifted, local agencies say. Chechen “Akhmat” special forces are withdrawing from the Rostov region.

6. Russian media: Russia will retain control of tactical nuclear weapons in Belarus. Secretary of State Blinken: No change in U.S. nuclear posture. The situation in Russia is an “internal matter” for Russia. President Biden has not tried to reach out to Putin.

7. U.S. media said that U.S. intelligence learned of Prigozhin's “defection” plan in mid-June.

8. Putin: Russia is confident of achieving all plans and tasks of its “special military operation” in Ukraine.

9. Bank of Russia: Moscow exchange will start normal operations on Monday. Despite the fact that Monday is a non-working day in Moscow, banks and financial institutions should continue to perform their main functions.

10. Russian media: NATO and the Russian Defense Ministry “informal contacts” on the “Wagner” situation.

11. Chinese Foreign Ministry responded to the Wagner Group affair: this is Russia's internal affairs, support Russia to maintain national stability.

12. Belarusian President Lukashenko spoke with Putin again. (Jin 10 Data App)

Institutional Perspective

01

Goldman Sachs

Raised the target level of Japan's Topix index from 2,200 to 2,500 for the next 12 months, expecting a surprise result in the semi-annual earnings report.

02

SOCIETE GENERALE

Most emerging market countries in Latin America and Eastern Europe are likely to start cutting interest rates in the coming months, a move that could boost emerging market bonds. 

03

MUFG

Japan's largest bank is in talks to issue a global stablecoin.

On June 23, Japan's largest bank, Mitsubishi UFJ, is reportedly in talks with the companies behind the popular global stablecoin and others about issuing such tokens through the bank's blockchain platform. Japan's stablecoin law, one of the first pieces of legislation in a major economy, went into effect on June 1, which effectively means that only licensed banks, and related financial companies in the country, can issue tokens. Tatsuya Saito, vice president of products at Mitsubishi UFJ, said the bank is in discussions with multiple parties to use its blockchain platform Progmat to create stablecoin pegged to foreign currencies, including the U.S. dollar, for global use. He said issuers and users will feel secure when using stablecoin now that Japanese legislation is in effect. However, he declined to say which stablecoin parties he is negotiating with.