Mai hui MHmarkets: July 3, 2023 - Fundamental Reminder

☆ 09:45 CNY Caixin Manufacturing PMI (JUN)

Its expected value is 50.2, the previous value is 50.9.

☆ 22:00 USD Markit Manufacturing PMI Final (JUN) & USD ISM Manufacturing PMI (JUN)& USD Construction Spending MoM (MAY)

☆ Market closure reminder: due to the U.S. Independence Day, the New York Stock Exchange closed at 1:00 GMT on the 4th in advance; due to Canada Day, the Toronto Stock Exchange is closed all day on Monday.

Market Overview

Review of Global Market Trend

On Friday, spot gold once down near the $1,900 mark, the U.S. market slightly softened expectations of a rate hike at the next Fed meeting due to a slightly higher-than-expected drop in core PCE, gold prices hit their best one-day performance in more than two weeks, eventually closing up 0.6% at $1,919.57 per ounce, up about 5% in the first half of the year. Spot silver also rebounded, eventually closing up 0.9% at $22.75 per ounce.

The U.S. dollar index erased all of the previous day's gains and lost the 103 barrier, eventually closing down 0.435% at 102.92. U.S. Treasury yields oscillated at high levels, with the U.S. 2-year Treasury yield recording a slight gain to close at 4.904%; the 10-year U.S. bond yield was close to a flat close at 3.841%.

International crude oil closed higher for the third straight session but fell for the fourth straight quarter as investors worried that low global economic activity could curb fuel demand. WTI crude oil hit an intraday high of $71.11 per barrel and closed up 1.02% at $70.37 per barrel; Brent crude oil closed up 1.05% at $75.09 per barrel.

The three major U.S. stock indexes closed up collectively, the S&P 500 rose 1.23%, the Dow rose 0.84%, the Nasdaq rose 1.45%. The first half of this year, the Dow and the S&P 500 index rose about 3.8% and 16%, respectively, for the third consecutive quarter; Nasdaq rose about 31%. The star technology stocks overall strong performance: Nvidia half-year cumulative rise of about 190%, Tesla rose about 112%, Amazon rose about 55%, Microsoft rose 42%, Apple rose about 49%, the stock price continued to record highs, the total market value of more than 3 trillion U.S. dollars. AI sector so far this year cumulative rise of more than 120%. Popular Chinese stocks trend divergence: ideal car in the first half of the cumulative rise of about 72%, Xiaopeng car rose about 35%, TSMC rose about 36%, Bilibili fell about 36%, Pinduoduo fell 15%, Jingdong fell 38%.

The major European stock indices were all in the red, with the German DAX30 closing up 1.26%; the FTSE 100 closing up 0.8%; and the Euro Stoxx 50 closing up 1.02%.        

Market Focus

1. Tesla delivered 466,140 vehicles in Q2, compared to market estimates of 448,400, and produced 479,700 vehicles, compared to market estimates of 456,600.

2. France riots for the 5th consecutive night, the French Interior Ministry believes the intensity of riot violence has diminished.

3. Five Eastern European countries' agriculture ministers plan to discuss food security issues and Ukraine's agricultural products in Poland on July 19.

4. According to CNN: A mass shooting in Baltimore, Maryland left 2 people dead and 28 injured.

Geopolitical Situation

Conflict Situation

1. Air defense sirens have sounded again in Kyiv, Ukraine, as they did in the early hours of Tuesday.

2. According to the Kyiv Independent: The General Staff of the Ukrainian armed forces reported the loss of 790 Russian troops in the past day, along with 10 tanks, 20 armored fighting vehicles, 26 artillery systems, 12 tactical drones and other equipment; Natalia Humeniuk, a spokeswoman for Ukraine's Southern Operational Command, said heavy fighting was continuing in the Antonovsky Bridge area in Kherson oblast.

3. According to Ukraine Pravda: Serhii Cherevatyi, spokesman of the Eastern Forces Group of the Ukrainian Armed Forces, Ukrainian defense units are advancing on the south and north sides around Bakhmut. There is no heavy fighting inside the city, but sniper teams and some other units are active inside the city.

4. Ukrainian border guard officials told local media that a massive reorganization of Wagner mercenaries' soldiers may be imminent in Belarus, where as many as 8,000 Wagner fighters could be deployed.

5. Russian Defense Ministry: Russian forces destroyed Ukraine's “Starlink” communications terminal near Archomovsk; In the direction of Kherson, Russian forces blocked Ukrainian troops trying to land in the Antonovsky Bridge area. Russian air defense forces shot down a Ukrainian Su-25 warplane and intercepted Ukrainian drones and several “Haimas” rockets.

Institutional Perspective

Goldman Sachs

【Goldman Sachs is said to be looking to pull out of its partnership with Apple】

Goldman Sachs is in talks with American Express to take over its Apple Credit Card and other businesses with Apple, according to people familiar with the matter. In addition, Goldman Sachs is understood to have discussed transferring its credit card partnership with GM to American Express or another card issuer. In any case, it would likely take a while to transfer the partnership, but Apple would have to agree to the transfer, the people said. Apple is aware of these negotiations, which have been going on for months.

02

SOCIETE GENERALE

Societe Generale Chairman: European banks have been resilient during rate hikes. The inflation problem puts central bank credibility at risk.

03

MUFG

MUFG analyst Derek: The news that Thames Water, which is currently heavily indebted, could come under government control is a clear example of how the effects of higher interest rates are spreading and adding to the distress that has been there for some time.