Wealth Wednessday

Market Data

Local

Global

*Data as of 4pm WAT

Market News

Local

Global

Weekly Investment Watchlist

Market Commentary

Asia and Australia:

• Asian stock markets concluded mostly higher on Wednesday. The main catalyst was a strong read-through from US equities. However, a late sell-off in Hong Kong dampened what had been a positive day for the Hang Seng. Mainland China markets also experienced a dip towards the close, but managed to stay in positive territory.

• Australia’s monthly Consumer Price Index (CPI) indicator for July 2023 recorded a 4.9% increase year-on-year, a slowdown from the 5.4% gain observed in June. This figure fell below the market consensus of a 5.2% rise. Notably, this marked the lowest inflation rate since February 2022, primarily attributed to reduced growth in housing and food prices. The Australian stock market closed higher in response to this news.

• Brick-and-mortar consumption in China continues to decline. According to Nikkei, Chinese retailers are significantly accelerating store closures. GOME, for instance, announced the closure of 90% of its locations, while Yonghui Superstores reduced its stores by 20-40% compared to 2019.

• China’s largest banks are gearing up to lower interest rates on existing mortgages amounting to CNY 38.6 trillion ($5.3 trillion) as well as deposits.

• In a bid to avert default, Chinese property developer Country Garden is seeking a 40-day grace period.

• ICBC, the world’s largest bank by asset size as of the end of 2022, is experiencing a near-record low valuation as its margins plummet.

• BOJ board member Tamura expressed that the realization of the inflation target is on the horizon. This signals a possibility of adjusting policy in early 2024.

Europe, Middle East, Africa:

• European equity markets initially gained ground but ultimately ended lower. Banks, Basic Resources, and Insurance sectors led the losses, while Utilities, Consumer Products/Services, and Technology lagged.

• Spanish inflation increased for the second consecutive month, reaching 2.6% year-on-year, in line with forecasts and compared to the previous figure of 2.3%.

• The European Commission’s Eurozone economic sentiment indicator softened in August to 93.3, falling short of the consensus estimate of 93.7 and the prior reading of 94.5. This marks the fifth consecutive decrease in sentiment.

• BoE mortgage approval data highlighted weak trends in the UK housing market, as net approvals decreased from 54,600 in June to 49,400 in July.

The Americas:

• July’s JOLTS job openings of 8.827 million fell well below the consensus of 9.478 million and were the lowest since March 2021. The revised June figure was 9.165 million (previously 9.582 million). The report also indicated 1.51 job openings for every unemployed worker, reaching the lowest level since September 2021. It’s my perspective that this number needs to drop between 7 million and 8 million to significantly impact the labor market.

• The Conference Board Consumer Confidence numbers for August revealed a significant drop to 106.1 from the revised 114 in July (previously 117). The assessment of the present situation declined in August, reflecting diminished optimism regarding employment conditions.

• Walmart has requested its 16,000 US pharmacists to accept reduced wages and fewer working hours in an attempt to cut costs.

• Apple has confirmed September 12 as the expected launch date for the iPhone 15 models.

• OpenAI is on track to generate over $1 billion in revenue within the next 12 months.

• HP Inc. revised its full-year cash flow and profit outlook, acknowledging that the rebound in the personal computer market will take longer than initially anticipated.

The Week Ahead:

• Monday:

  • China PBOC Interest Rate Decision

• Tuesday:

  • US Existing Home Sales Change (MoM)(Jul)

• Wednesday:

  • S&P Global/CIPS Composite PMI (Aug) PREL (UK)

  • Retail Sales (MoM)(Jun) (Canada)

  • S&P Global Manufacturing PMI (Aug) PREL(US)

  • Consumer Confidence (Aug) PREL (EU)

• Thursday:

  • ECB Monetary Policy Meeting Accounts (EU)

  • Durable Goods Orders (Jul)

• Friday:

  • GFK Consumer Confidence (Aug) (UK)

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.