Think Thursday

Market Data

Local

Global

*Data as of 6pm WAT

Market News

Local

Global

Weekly Investment Watchlist

Market Commentary

Asia and Australia

• Japan's manufacturing activity expands for the first time in seven months.

• South Korea S&P Global PMI reflected a continued slowdown in the country's manufacturing output but hinted at the slowing pace of decline.

• Repricing of the RBA rate path continues with futures now pricing in a 100% chance of a rate increase by August (vs zero probability in mid-May).

• India's GDP growth accelerated to 6.1% in Q4 y/y (ending 31 Mar-23) from 4.5% y/y growth in Q3, boosted by government and private spending, and manufacturing.

Europe, Middle East, Africa

• The details of the ECB May meeting showed most members backed the decision to raise rates by the more moderate 25 bps, though some members initially expressed a preference for a larger move.

• Eurozone inflation cools in May but will not stop the ECB hiking cycle. Flash CPI is at 6.1% y/y versus consensus 6.3% and prior 7.0% gain, while core is at 5.3% versus 5.5% forecast and prior 5.6%.

• UK manufacturing activity declines for the third straight month in May

• Eurozone manufacturing downturn deepens in May. Manufacturing PMI falls to a 36-month low of 44.8 vs the preliminary reading of 44.6 and April's outcome of 45.8.

The Americas

• Fed officials signal support for leaving rates unchanged in June while retaining the option to hike again in coming months

• Deutsche Bank warns of an imminent wave of corporate debt defaults. They forecast peak default rates to reach 9% for U.S. high-yield debt, 11.3% for U.S. loans, 4.4% for European high-yield bonds, and 7.3% for European loans.

• BofA noted that its Global Earnings Revision Ratio improved significantly last week from 0.77 to 0.90 to reach the highest level in over a year. It would seem that Earnings revisions are being improved to cater to the better-than-expected results delivered in Q1, 2023.

The Week Ahead:

• Monday: Fed talk - Bullard, Barkin, Bostic, Daly

• Tuesday: US Manufacturing PMI comes in at 48.5; est: 50.2, US new homes sales come in at 683k; est: 663k.

• Wednesday: FOMC minutes

• Thursday: Initial jobless claims, GDP growth, pending home sales

• Friday: Core PCE, personal income & spending, durable goods orders, Michigan consumer sentiment

Investment Tip of The Day

Meme of the Day

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.