Posted Aug 25, 2021 by Martin Armstrong
India’s July crude oil imports slumped to their lowest in a year, tanker arrival data from industry sources showed, and are likely to rebound in August as refiners are expected to boost runs after the maintenance of units. Crude imports in July fell 12.5% month-on-month to 3.4 million barrels per day (bpd), but rose 12.8% year-on-year, as refiners shut units for maintenance and cut crude imports anticipating lower fuel demand during the monsoon season. Government data released on Tuesday showed India’s oil imports declined to about 15.02 million tonnes, about 3.5 million bpd.
Japan’s economy recovered strongly in the second quarter to join the turnaround seen across G7 countries as the easing of lockdown restrictions sent consumers rushing to the shops. After a 0.9% drop in the first quarter, economic output expanded 0.3% in the second quarter, or by 1.3% using the annualized calculation that is more commonly cited by Tokyo. Analysts had expected the annualized growth to be only 0.7%. The second quarter rebound was also more modest than seen in the US, where GDP growth leaped 6.5% on an annualized basis in the second quarter.
The major Asian stock markets had a mixed day today:
- NIKKEI 225 decreased 7.30 points or -0.03% to 27,724.80
- Shanghai increased 25.91 points or 0.74% to 3,540.38
- Hang Seng decreased 33.97 or -0.13% to 25,693.95
- ASX 200 increased 28.90 points or 0.39% to 7,531.90
- Kospi increased 8.51 points or 0.27% to 3,146.81
- SENSEX decreased 14.77 points or -0.03% to 55,944.21
- Nifty50 increased 10.05 points or 0.06% to 16,634.65
The major Asian currency markets had a green day today:
- AUDUSD increased 0.00148 or 0.20% to 0.72679
- NZDUSD increased 0.00278 or 0.40% to 0.69651
- USDJPY increased 0.32 or 0.29% to 110.03
- USDCNY increased 0.00024 or 0.00% to 6.47092
- Gold decreased 12.59 USD/t oz. or -0.70% to 1,790.02
- Silver decreased 0.07 USD/t. oz or -0.29% to 23.766
Some economic news from last night:
Manufacturing BSI Index (Sep) decreased from 96 to 94
Construction Work Done (QoQ) (Q2) decreased from 2.4% to 0.8%
Exports (Jul) decreased from 5.96B to 5.75B
Imports (Jul) increased from 5.71B to 6.16B
Trade Balance (YoY) (Jul) decreased from -280M to -1,100M
Trade Balance (MoM) (Jul) decreased from 245M to -402M
Some economic news from today:
Coincident Indicator (MoM) (Jul) increased from 1.9% to 2.4%
Leading Index (MoM) increased from -1.2% to 1.5%
Leading Index increased from 102.6 to 104.1
M2 Money Supply (YoY) (Jul) decreased from 11.40% to 8.90%
Motorbike Sales (YoY) (Jul) decreased from 155.10% to 28.90%
Unemployment in the UK fell in June as workers made redundant during the pandemic appeared to respond to a record rise in vacancies to re-enter the labor market and secure a job. According to official figures, the unemployment rate dropped to 4.7% in the three months to June, down 0.2 percentage points from the previous quarter. Data for July showed the number of job vacancies passed 1 million for the first time on record, the Office for National Statistics said. Wages jumped 7.4% without bonuses and 8.8% including bonuses to reinforce the message from employers that where shortages exist, workers can expect to receive signing on fees and retention bonuses.
Germany’s leading indicator joins the choir of recently released leading indicators pointing to a loss of momentum in the German economy. The Ifo index dropped for the second month in a row in August and came in at 99.4. While the current assessment component improved to the highest level since June 2019, expectations saw their sharpest drop since the start of the pandemic.
The major Europe stock markets had a mixed day:
- CAC 40 increased 12.17 points or 0.18% to 6,676.48
- FTSE 100 increased 24.34 points or 0.34% to 7,150.12
- DAX 30 decreased 45.19 points or -0.28% to 15,860.66
The major Europe currency markets had a green day today:
- EURUSD increased 0.0008 or 0.07% to 1.17615
- GBPUSD increased 0.00102 or 0.07% to 1.37337
- USDCHF increased 0.00029 or 0.03% to 0.91329
Some economic news from Europe today:
Spanish PPI (YoY) remain the same at 15.3%
ZEW Expectations (Aug) decreased from 42.8 to -7.8
German Business Expectations (Aug) decreased from 101.0 to 97.5
German Current Assessment (Aug) increased from 100.4 to 101.4
German Ifo Business Climate Index (Aug) decreased from 100.7 to 99.4
Mortgage delinquencies in the US fell by 5% in July to 4.14%, however, 1.45 million borrowers remain at least 90 days delinquent on their mortgage payments. Foreclosures drastically improved in July after falling 58% from the same time last year. The Mortgage Bankers Association (MBA) believes the Q2 delinquency rate is 5.47%. The decline in delinquencies across VA and FHA loans was the most significant decline noted since the MBA began keeping records in 1979.
House Democrats passed a large $3.5 trillion budget plan that will be partly funded by increasing taxes for wealthy Americans. The 220-212 vote will allow Democrats to write a spending package without needing the approval of a single Republican. Top earners are likely to experience a rise in income taxes from 37% to 39.6%. Those who earn over $1 million per year will see a 39.6% capital gains tax as well, which does not include the additional 3.8% surtax on investment income. According to the Tax Foundation, 40% of Americans earning over $1 million annually derive income from investments. In comparison, those who earn $50,000 only invest 5% on average, partially due to a lack of expendable income. The Treasury estimates that $584 billion in taxes went unreported in 2019, and increased reporting from third-parties to the IRS will likely occur.
According to Statistics Canada, Canadians have being paying off debt at a rapid pace since the pandemic began. Non-mortgage debt dell by $20.6 billion from March 2020 to January 2021. Credit card debt declined $16.6 billion over the same period, reversing the trend as credit card debt has experienced an average annual growth rate of 20% over the past 20 years. Lockdowns contributed to reduced spending, with average household consumption declining 14.7% during Q2 of 2020 compared to the year prior. The agency noted that citizens with the lowest credit ratings saw the largest reductions in debt.
US Market Closings:
- Dow advanced 39.24 points or 0.11% to 35,405.5
- S&P 500 advanced 9.96 points or 0.22% to 4,496.19
- Nasdaq advanced 22.06 points or 0.15% to 15,041.86
- Russell 2000 advanced 8.36 points or 0.37% to 2,239.27
Canada Market Closings:
- TSX Composite advanced 39.56 points or 0.19% to 20,587.32
- TSX 60 advanced 2.7 points or 0.22% to 1,236.3
Brazil Market Closing:
- Bovespa advanced 606.96 points or 0.5% to 120,817.71
The oil markets had a green day today:
- Crude Oil increased 0.49 USD/BBL or 0.73% to 68.0300
- Brent increased 0.79 USD/BBL or 1.11% to 71.8400
- Natural gas increased 0.043 USD/MMBtu or 1.10% to 3.9390
- Gasoline increased 0.0767 USD/GAL or 3.52% to 2.2575
- Heating oil increased 0.0336 USD/GAL or 1.63% to 2.1004
The above data was collected around 12:22 EST on Wednesday
- Top commodity gainers: Gasoline (3.52%) and Lean Hogs (1.58%), Heating Oil (1.63%) and Rubber (2.46%)
- Top commodity losers: Methanol (-2.41%), Bitumen (-2.85%), Palladium (-1.40%), and Platinum (-1.72%)
The above data was collected around 12:35 EST on Wednesday.
Japan 0.02%(+0bp), US 2’s 0.2445%(+0.02%), US 10’s 1.3272%(+3.03bps); US 30’s 1.9441%(+0.030%),Bunds -0.4250% (+5.2bp), France -0.0690% (+5.9bp), Italy 0.6629% (+9.13bp), Turkey 16.66% (-6bp), Greece 0.5990% (+3bp), Portugal 0.209% (+7.5bp); Spain 0.31% (+14.13bp) and UK Gilts 0.5960% (+5.8bp).