Finance Friday

Market Data

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Global

*Data as of 4pm WAT

Market News

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Global

Weekly Investment Watchlist

Market Commentary

Asia and Australia

• Asian equities mostly traded higher. Hang Seng rebounded, breaking a three-day losing streak. Mainland China stocks also edged up with higher trading volumes. ASX and Nikkei both recorded gains, while Taiex and Kospi closed slightly lower.

• PBOC Governor Pan met with property developers and pledged funding support, reassuring that the bank would keep China’s banking system with reasonably ample liquidity.

• The rare vow from the Politburo on market support is leading to expectations that Beijing will take steps to increase trading activity.

• RBA minutes were released, indicating that inflation is not expected to return within the 2-3% target band until late 2025. Wage growth peak was slightly revised up, but the near-term GDP growth outlook was downgraded due to the larger drag on consumption growth from the cost of living and higher rates.

Europe, Middle East, Africa

• European equity markets were mostly higher, following the STOXX 600's three negative closes in a row on Thursday.

• Saudi Arabia warned that it could deepen cuts to oil production as it extended voluntary supply curbs with Russia for another month.

• Eurozone retail trade unexpectedly declined in June, coming in at (0.3%) vs. the expected +0.2% MoM or (1.4%) vs. (1.7%) YoY.

• German factory orders unexpectedly jumped the most in three years in June, driven by strong demand from the aerospace sector.

• ECB’s Lane sees lower headline inflation ahead, while core inflation may have peaked in H1.

• For the first time, the Bank of England (BoE) referred to its current monetary policy stance as “restrictive,” which some investors interpreted as a sign that tightening may be nearing its end. However, some analysts still predict two more 25bps rate hikes by the MPC for this year, taking the Bank Rate to 5.75%.

The Americas

• Amazon’s beat was driven by both AWS and e-commerce. Amazon’s Q2 revenue beat expectations by more than 2%, and operating income was more than 60% ahead.

• BofA flow data shows investors fleeing equities amid US recession risk, although tech funds still saw inflows.

• Hedge funds lost more than $6 billion this year betting against cruise lines and hotels, underestimating US consumer resilience.

• US 30-year Treasury bonds head for their worst week of the year amid rising bets on a recession.

• Morgan Stanley doesn’t see 3% GDP growth for the US economy, discussing the GDP growth coming in from nearshoring activity that may not be as sustainable.

The Week Ahead:

• Monday:

  • Large Retailer Sales (Japan)

  • NBS Manufacturing PMI (China)

  • Chicago Purchasing Managers Index (US)

• Tuesday:

  • Unemployment Rate (Japan)

  • Caixin Manufacturing PMI (China)

  • Unemployment Rate (EA)

  • S&P Global Manufacturing PMI (Canada)

  • ISM Manufacturing PMI (US)

• Wednesday:

  • BOJ Monetary Policy Meeting Minutes (Japan)

  • ADP Employment Change (US)

  • U.S Added 324,000 Jobs in July Beating Estmate of +190,000 Jobs

• Thursday:

  • US credit rating downgraded by Fitch Ratings from an AAA to AA+.

  • US Treasury boosts quarterly bond sales for the first time in 2.5 years in order to help finance budget deficits.

  • US ADP nonfarm payrolls for July come in at 324k; est: 190k.

  • Softbank (SFTBY) chip maker ARM is targeting a $60b IPO in September.

• Friday:

  • US non-farm productivity came in at +3.7% YoY; est: 2.2%. Biggest rise since 2020.

  • US weekly jobless claims come in at 227k; est: 225k.

  • Bank of England (BOE) raises its benchmark rate .25bps and it is now 5.25%.

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Disclaimer: The information contained in this report is intended for informational purposes only and should not be considered as investment advice. The information is obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed.