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Spains PPI monthly rate in July was 0.8%, compared with 3.20% in the previous month.Spains PPI annual rate was 0.3% in July, compared with 0.80% in the previous month.On August 25th, UBS published a research report stating that Hengan (01044.HK)s revenue and net profit fell by 0.2% and 2.6% respectively in the first half of 2025. Excluding foreign exchange gains, net profit is expected to fall by approximately 12% during the period, roughly in line with the banks expectations. During the period, revenue from the tissue business increased by 3% year-on-year, while revenue from the sanitary napkin business decreased by 14% year-on-year. Management pointed out that wet wipes performed steadily and competition in the tissue market was better than expected, but sales of sanitary napkins and mid-to-low-end diapers declined due to intensified competition. Looking ahead, the group expects tissue sales to grow steadily and the gross profit margin of sanitary products to improve in the second half of 2025. UBS raised Hengans earnings forecast for 2025 to 2027 by 1% to 4% and its revenue forecast by 1% to 2%. It also raised its target price from HK$27.7 to HK$29.5 and maintained its buy rating.Kazakhstans Energy Ministry: Oil exports were not affected after the Ukrainian drone attack on the Russian port of Ust-Luga.On August 25th, Goldman Sachs raised its earnings per share forecast for WuXi Biologics (02269.HK) from 2019 to 2027 by 11.9% to 15.9%, reflecting better-than-expected gross profit margin improvements. The target price was raised from HK$25.6 to HK$29.3, while the target price-to-earnings ratio remained at 23x. The rating was neutral. The bank reported that the companys interim gross profit margin expanded by 3.6 percentage points year-over-year to 42.7%, driven by a reduction in employee share-based compensation, increased milestone revenue from the R phase of the research, and improved utilization of new production capacity, offsetting losses from the Irish project. The report indicates that management expects the gross profit margin improvement to continue in the second half of the year. Based on increased operating efficiency and capacity utilization, the long-term gross profit margin target is 50%, with the Singapore plants gross profit margin expected to reach approximately 45%.

EUR / USD Investors Challenge 1.0600 As Mixed US Data Tests Fed Conservatives, US NFP, and ECB's Lagarde

Daniel Rogers

Mar 10, 2023 11:31

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EUR / USD gains bids to extend the midweek rebound from a two-month low, rising 0.16 percent intraday near 1.0600 on Friday morning. In doing so, the Euro-Dollar pair celebrates the broad weakness in the US Dollar ahead of the important US employment report for February and Christine Lagarde's speech as president of the European Central Bank (ECB).

 

The major currency pair reversed a two-day losing trend due to mixed US data and a decline in US Treasury bond yields the day before. Hawkish ECB remarks and the market's positioning for today's crucial US data bolstered the run-up. However, inflation worries and geopolitical tension present challenges for EUR / USD buyers.

 

Despite this, US Initial Jobless Claims increased to 211K for the week ending March 3, compared to the predicted 195K and the previous week's 190K. In addition, there was a decline in Challenger Job Cancellations and an increase in Continuing Jobless Claims. Consequently, early indications for Friday's Nonfarm Payrolls (NFP) appear mixed and challenge the market's push for a 0.50 percentage point Fed rate hike in March, which is supported by Federal Reserve Chairman Jerome Powell's most recent signals.

 

Despite contradictory data, inflation worries continue to favor Fed conservatives, especially after Chairman Jerome Powell defends the stricter monetary policy, which restrains Euro prices. It should be noted that the most recent report from the New York Fed noted that recent upward revisions to inflation data and higher-than-anticipated levels of inflation had altered what had previously appeared to be a decline in price pressures.

 

Francois Villeroy de Galhau, an ECB policymaker, stated on Thursday that they will return inflation to 2% by the end of 2024 or 2025.

 

In addition to the aforementioned catalysts, geopolitical concerns emanating from US President Joseph Biden's proposed budget for 2024 and the US's partnership with the UK and Australia for nuclear submarines should challenge EUR / USD buyers.

 

In this context, US 10-year and 2-year Treasury bond yields extend yesterday's losses to 3.88% as of press time, dragging on the US Dollar Index (DXY), which is presently down 0.10 percent to 105.12. Despite this, Wall Street benchmarks closed with daily losses exceeding 1.5%, causing S&P 500 Futures to post modest losses as of press time.

 

According to market predictions, the employment report for February in the United States is expected to reveal a general softening. The same contrasts with the Fed's hawkish inclination to emphasize the likelihood of a significant market move in favor of the US Dollar in the event of a positive surprise. However, Lagarde of the ECB must confirm this.

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