EUR/USD 1.17795
-0.021%
Gold 4781.48
-0.193%
Oil 89.746
0.135%
USD/JPY 159.346
0.129%
GBP/USD 1.35204
-0.044%
GBP/JPY 215.450
0.097%
Browse More
  • English
  • 简体中文
  • 繁體中文
  • Tiếng Việt
  • ไทย
  • Indonesia
Subscribe
Real-time News
On April 17th, a UBS research report pointed out that despite the European Central Banks (ECB) hawkish tone, the bank is expected to keep interest rates unchanged until the end of the year. ECB President Christine Lagarde stated this week that rising energy costs have pushed the Eurozone away from the central banks baseline outlook, and the ECB is weighing its options. Given the ECBs inflation mandate and its forecast that the Iran war will have a greater impact on inflation than on growth, current market pricing indicates that the ECB will raise interest rates twice before the end of the year. However, the current economic context is significantly different from that of 2022 when the Russia-Ukraine conflict erupted. The ECBs policy has only recently returned to a neutral setting, and the labor market has been weak. Considering the risks the conflict poses to the growth outlook and the tightening financial conditions already seen in the bond market, we believe the ECB is unlikely to rush into raising interest rates and is more likely to keep them unchanged until the end of the year.On April 17, Foreign Ministry Spokesperson Guo Jiakun held a regular press conference. Guo stated that in recent years, harassment and provocations against Chinese diplomatic missions in Japan have been constant, culminating in a series of serious incidents recently, including active-duty Self-Defense Force officers storming the embassy with knives. Japans security policy is shifting towards an aggressive, expansionist, and dangerous direction. The Japanese side has failed to manage and control the Self-Defense Forces, and there is a lack of internal management and training within the Self-Defense Forces. How to fundamentally resolve these issues is a question worthy of deep reflection by insightful individuals within Japan. We once again urge Japan to reflect on its mistakes, thoroughly investigate and rectify them, and give China a responsible explanation.On April 17, Foreign Ministry Spokesperson Guo Jiakun held a regular press conference. Guo Jiakun pointed out that China consistently opposes illegal unilateral sanctions lacking a basis in international law and without authorization from the UN Security Council, and opposes the abuse of long-arm jurisdiction. Cooperation between China and Venezuela is protected by international law and the laws of both countries, and Chinas legitimate rights and interests in Venezuela must be guaranteed.On April 17th, a UBS research report pointed out that the Federal Reserve remains on track for further easing. Fed Chairman Powell recently downplayed the need to tighten monetary policy due to rising energy prices, noting that policymakers typically "ignore" supply shocks such as soaring oil prices, especially when inflation expectations remain firmly under control. While the Fed is still seeking further evidence of a sustained decline in core inflation before implementing further easing, we still expect a 50 basis point rate cut later this year. Given that US Treasury yields are significantly higher than pre-conflict levels, we believe there is ample downside potential, and our year-end targets for 2-year and 10-year Treasury yields are 3.25% and 3.75%, respectively.Alstom shares fell to their lowest point since the end of June 2024 and are on track for their biggest one-day drop since early October 2023.

Stocks Boosted by Strong Apple, Amazon Earnings, Nasdaq 100 Ends July 12.5% Higher

Cory Russell

Aug 01, 2022 15:50


Exceptional Apple and Amazon Earnings Boost Attitude

Major US indexes experienced strong gains on earnings optimism despite data released on Friday by the US indicating high inflationary pressures in June and elevated wage growth in Q2. These data led to a small rebuilding of Fed tightening bets. Bulls seeking a test of early-June highs in the upper-4,100s drove the S&P 500 up 1.4 percent to 4,130. The Nasdaq increased by 1.8 percent to reach its highest point since May and almost retested the 13,000 mark.


The S&P 500 had its greatest monthly performance since November 2020 with a gain of 9.1 percent. Meanwhile, the Nasdaq 100 index saw its biggest monthly return since April 2020, rising almost 12 percent in July.


After the business provided a positive outlook, Apple's stock price increased by more than 3.0% above its 200-Day Moving Average and reached its highest level since early May. The world's biggest firm by market capitalization said supply chain hiccups are subsiding and that demand for its iPhones is still high.


Meanwhile, after the e-commerce giant predicted robust Q3 sales despite increasing Prime membership fees, neighboring US internet giant Amazon saw its share price rise over 10% and to its highest level since April. The previous two weeks have seen US equities markets benefit significantly from Q2 earnings. 77.8% of the 279 S&P 500 firms who have released earnings results so far, according to Reuters, have surpassed analyst estimates.


The fact that Fed Chair Jerome Powell was less pessimistic during the Fed policy announcement on Wednesday, as well as data released on Thursday showing that the US was already in a technical recession in the first quarter of 2022, were major positives for stocks this week. Investors interpreted these factors as signs that the Fed would be less likely to raise interest rates in the coming quarters.


Markets Rebuild Slightly A flood of US data dropped on Fed Bets Friday. The closely watched US Employment Cost Index increased 1.3 percent QoQ in Q2, indicating that despite the economy's contraction, the labor market remained strong. The PCE price index, the Fed's favored inflation indicator, increased at its fastest YoY rate since 1982 in June, along with a 1.0 percent MoM jump that was the largest since 2005.


Personal Income and Spending both had somewhat stronger MoM growth in June than anticipated, supporting some hope that the US economy could be able to avoid contracting in Q3. After the big data dump, the money market indicated likelihood of another 75 bps rate rise from the Fed increased somewhat to just under 40% from closer to 30% before.


However, the stock markets seemed to be far more interested in optimistic earnings. Health Care (-0.4%) and Consumer Staples (-0.7%) were the only two of the eleven sectors in the S&P 500 GICS sector performance breakdown to show a loss. With increased oil prices and after Chevron and Exxon Mobil announced record quarterly profits, energy was the best-performing sector, up 4.5 percent. The second greatest performance, Consumer Discretionary, increased by 4.2 percent.

Suggestion