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On August 21, Nomura issued a research report stating that Kuaishous (01024.HK) second-quarter results met expectations, but the slowdown in its core businesses (e-commerce and live streaming) was faster than anticipated. Therefore, the bank maintained its "Neutral" rating but lowered its target price from HK$51 to HK$40.Futures Commentary by Everbright Futures: 1. Overnight, gold prices initially declined before rebounding. Spot gold recovered to $4,500/ounce, up 0.08%, while SHFE gold rose 1.03%. US initial jobless claims data was released, showing 206,000 claims this week, lower than the expected 210,000, indicating resilience in the job market. After a significant rise in gold prices the previous day, some profit-taking led to intraday volatility. The US Treasury expanded its long-term bond repurchase program, causing yields on long-term US Treasury bonds to rise again. US Treasury Secretary Bessenter stated that a single long-term bond repurchase could exceed $4 billion, emphasizing the Treasurys powerful toolbox, which further eased market concerns. However, expanding long-term bond repurchases cannot solve the problem of high US fiscal debt; the policy itself is a support measure after the bond market crash, and the market may gradually return to rationality. Short-term gold volatility has intensified. 2. On the geopolitical front, according to Xinhua News Agency, the US military has quietly established a shipping channel in and out of the Strait of Hormuz, ensuring that "millions of barrels" of oil are transported out of the Strait of Hormuz daily. This operation has been ongoing for several weeks. The rapidly growing US Treasury bond, concerns about stagflation, the stalemate in US-Iran negotiations, and the Federal Reserves indecisiveness regarding a September rate hike have fueled safe-haven demand for gold, potentially driving gold prices to maintain a relatively strong upward trend.The UKs July public sector net borrowing and seasonally adjusted retail sales figures will be released in ten minutes.On August 21, the Chongqing Municipal Peoples Government issued the "Chongqing Municipal 15th Five-Year Plan for the Construction of a Beautiful Chongqing (2026-2030)," which proposes to promote the low-carbon upgrading of transportation equipment. The plan calls for actively promoting new energy vehicles, advancing the electrification of public sector vehicles, and promoting the application of pure electric and hydrogen fuel cell commercial vehicles. It also calls for the construction of zero-carbon transportation corridors, establishing "zero-carbon corridors," implementing the scrapping and replacement of old operating vessels, and promoting new energy and clean energy-powered vessels. Furthermore, it aims to promote energy-saving and carbon-reducing retrofits of existing transportation infrastructure and construct a number of low-carbon stations, wharves, and highway service areas.Market news: Members of the SK Hynix South Korean labor union will vote on the provisional wages and labor agreement for 2026 from August 24 to 25.

EUR/USD Expects Fourth Weekly Gains Above 1.0900 Despite The US Dollar's Rebound Advance Ahead Of US NFP

Daniel Rogers

Apr 07, 2023 11:42

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Despite a recent retreat, the EUR/USD bulls maintain control around 1.0920. This reflects the typical Good Friday inactivity and apprehension ahead of the US Nonfarm Payrolls (NFP) report released early in the day. The major currency pair was volatile on Thursday as a result of the US Dollar's initial rebound on fears of a recession, but ended the day unchanged as disappointing US data contrasted with stronger Eurozone data.

 

Fears of a recession in the world's largest economy were prompted by consecutive lackluster US data and falling US Treasury bond yields, giving USD bears a reprieve on Thursday morning. As traders prepared for the all-important NFP, the dollar's subsequent gains were reversed by another disappointing US employment report.

 

Despite this, US Initial Jobless Claims for the week ending March 31 rose to 228K from 200K anticipated and an upwardly revised 246K the prior week. Notable is the increase in Challenger Job Cuts from 77,77K to 89,703K in the given month.

 

Notably, Reuters fanned fears of a recession by citing the most recent decline in the preferred bond market indicator of Federal Reserve (Fed) Chairman Jerome Powell. The most reliable bond market indicator of an imminent economic contraction, according to Federal Reserve research, is the "near-term forward spread" between the forward rate on Treasury bills 18 months from now and the current yield on three-month Treasury bills.

 

According to Reuters, International Monetary Fund (IMF) Managing Director Kristalina Georgieva stated in prepared remarks on Thursday that the global economy is projected to expand by less than 3% in 2023, a decrease from 3.4% in 2022.

 

In other news, Germany's Industrial Production (IP) increased 0.6% year-over-year in February, versus market predictions of -2.7% and previous readings of -1.7%. Additionally, the monthly figures exceeded expectations by 0.1%, coming in at 2.0% compared to 3.7% previously. On Wednesday, Germany Factory Orders for February improved to -5.7% YoY from -12.0% previously revised down and -10.5% market expectations, while MoM growth came in at 4.8% compared to 0.3% expected and 0.5% previous readings.

 

Wall Street and US Treasury bond yields have both reduced weekly losses as a result of these strategies, but investors remain skeptical.

 

In the context of less liquidity surrounding the March US employment report, sporadic activity on the major markets can keep the EUR/USD inactive and prone to abrupt price swings. Notable is the fact that recent dovish Fed forecasts and disappointing US data generate expectations for a positive surprise and enormous price volatility thereafter.


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