MHMarkets：November 16, 2023--Fundamental Reminder

08:30 AUD Unemployment Rate (OCT)

09:30 CNY House Price Index YoY (OCT)

21:30Initial Jobless Claims (NOV/11)

22:15 Industrial Production MoM (OCT)

22:25 Fed Williams Speaks

23:35Fed Barr Speaks

MHMarkets Market Overview

Review of Global Market Trend

On Wednesday, the dollar index recovered some ground, holding the 104 mark and finally closing up 0.317% at 104.4. Treasury yields turned higher intraday. The yield on the 10-year Treasury note closed at 4.543%; The yield on the two-year Treasury note, which is more sensitive to the Fed's policy rate, closed at 4.916%.

Spot gold briefly rose above the 1,970 mark, a new one-week high, then reversed course, falling below the 1,960 mark, giving up all of the day's gains and ending down 0.04% at $1,961.67 an ounce. Spot silver rose further above the 23 mark and finally settled up 1.64% at $23.44 an ounce.

International oil prices fell after a larger-than-expected increase in US crude inventories. WTI crude oil lost two round marks of 78 and 77, and finally closed down 2.09% at $76.53 a barrel. Brent crude settled down 1.75% at $80.95 a barrel.

The three major U.S. stock indexes closed up in volatile trading, with the Dow Jones Industrial Average up 0.47%, the S&P 500 up 0.16% and the Nasdaq up 0.07%. Nvidia (NVDA.O), Amazon (AMZN.O) and META Platforms(META.O) all fell more than 1%, while Tesla (TSLA.O) rose more than 2%. The Nasdaq China Golden Dragon Index closed up 2.8%, with Alibaba (BABA.N) up 3.8%, JD.com (JD.O) up 7% and Xpeng Motor (XPEV.N) up 2.2%.

European shares extended gains. Europe's Stoxx 50 index closed up 0.55%, Germany's DAX30 index rose 0.86%, Britain's FTSE 100 index rose 0.62%, France's CAC40 index rose 0.33%, Spain's IBEX35 index rose 0.18% and Italy's FTSE MIB index rose 0.42%.

Market Focus

1. Us retail sales m/m came in stronger than expected at -0.1% in October, the first decline in 7 months, vs -0.3% expected vs 0.9% previously. The US PPI monthly rate came in weaker than expected at -0.5% in October, the biggest drop since April 2020.

2. San Francisco Fed President Richard Daly warned that declaring victory in the fight against inflation too soon and then having to raise rates again would endanger the Fed's credibility. Richmond Fed President Barkin: Continued strong economic growth may warrant rate hikes.

3. The Atlanta Fed's GDPNow model expects fourth-quarter GDP growth of 2.2%, compared with 2.1% previously.

4. Us EIA crude oil inventories recorded a 3.6 million barrel increase in the week ended November 10th, more than the expected 1.793 million barrel increase.

5. Saudi Arabia is likely to maintain its production cuts, which began this summer, through January or beyond, according to a survey of traders and analysts.

6. Russia will cut its oil export tax to $24.7 per tonne on December 1st.

7, U.S. Senate Majority Leader Chuck Schumer accelerated the voting process, and the temporary funding bill is expected to pass as soon as Wednesday. U.S. officials: President Joe Biden will sign the bill if it passes the Senate.

Institutional Perspective

01

Fidelity International

【Fidelity International：While a long period of high interest rates in the United States could be a drag on the economy, it would actually be good for the dollar】

Fidelity believes that while high long-term interest rates in the United States may drag the economy into a downturn, they will actually help the dollar. “I don't think we can say the dollar bull market is over, and we have been reducing our exposure to overall non-U.S. currencies in part because of that view,” said George Efstathopoulos, a portfolio manager at Fidelity International in Singapore. Of course, at least in the short term, given that previously bullish dollar positions have become one of the most crowded trades in the market, the greenback certainly can't be ruled out for further weakness anytime soon.

02

PIMCO

【PIMCO：With “the inflation problem far from being solved”, there is a risk that the bond market will over-believe in a rate cut next year.】

Daniel Ivascyn, chief investment officer at US bond giant PIMCO, said on Wednesday that the bond market was at risk of over-believing in a rate cut next year because “the inflation problem is far from resolved”. While he welcomed the boost to PIMCO's performance from the bond rally, Mr. Ivascyn warned that a true return of inflation to the Fed's target “is going to be a bumpy ride.”He runs the roughly $126bn PIMCO Income Fund, the world's largest actively managed bond fund.

03

HSBC

【HSBC：Going into 2024, we would still maintain our view of the dollar's resilience, especially with weak global growth and relatively firm Treasury yields.】

Charlotte Ong, a strategist at HSBC, said the current bout of dollar weakness was related to markets pricing in more Fed easing, but other G10 currencies should also feel pressure going forward as markets price in a similar dovish turn from these non-U.S. central banks. “Going into 2024, we would maintain our view of a resilient U.S. dollar, especially with weak global growth and relatively strong U.S. yields,” Mr. Ong noted.