Market Talk – January 6, 2023

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ASIA:

 

Japan’s core consumer inflation hit a fresh four-decade high as companies continued to pass on rising costs to households, data showed, a sign price hikes were broadening and could keep the central bank under pressure to whittle down massive stimulus. Japan’s core consumer price index (CPI), which excludes volatile fresh food but includes energy costs, rose 3.7% in November from a year earlier, data showed on Friday, matching market forecasts and perking up from a 3.6% gain in October.

While many retailers plan further hikes for food products next year, the outlook for inflation and the timing of any further BOJ policy tweaks are muddled by the risk of global recession and uncertainty over the pace of wage hikes, analysts say.

 

 

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 increased 153.05 points or 0.59% to 25,973.85
  • Shanghai increased 2.42 points or 0.08% to 3,157.64
  • Hang Seng decreased 60.53 points or -0.29% to 20,991.64
  • ASX 200 increased 46.00 points or 0.65% to 7,109.60
  • Kospi increased 25.32 points or 1.12% to 2,289.97
  • SENSEX decreased 452.90 points or -0.75% to 59,900.37
  • Nifty50 decreased 132.70 points or -0.74% to 17,859.45

 

 

The major Asian currency markets had a mixed day today:

  • AUDUSD increased 0.01155 or 1.71% to 0.68645
  • NZDUSD increased 0.01054 or 1.69% to 0.63334
  • USDJPY decreased 1.205 or -0.90% to 132.195
  • USDCNY decreased 0.06009 or -0.87% to 6.83091

 

Precious Metals:

  • Gold increased 31.03 USD/t oz. or 1.69% to 1,864.22
  • Silver increased 0.657 USD/t. oz or 2.83% to 23.873

 

Some economic news from last night:

Japan:

Services PMI (Dec) increased from 50.3 to 51.1

 

Some economic news from today:

India:

FX Reserves, USD increased from 562.81B to 562.85B

Hong Kong:

Foreign Reserves (USD) (Dec) increased from 423.20B to 424.00B

 

 

EUROPE/EMEA:

 

Inflation in the euro zone dropped for a second consecutive month in December, but analysts do not expect it to spark a change in tone from the European Central Bank. Headline inflation, which includes food and energy costs, came in at 9.2% year on year in December, according to preliminary data Friday from the European statistics agency, Eurostat. It follows November’s headline inflation rate of 10.1%, which represented the first slight contraction in prices since June 2021. At the time, the central bank forecast an average inflation rate of 8.4% for 2022, 6.3% for 2023 and 3.4% for 2024. The ECB’s mandate is to work toward a headline inflation figure of 2%.

 

The major Europe stock markets had a green day:

  • CAC 40 increased 99.45 points or 1.47% to 6,860.95
  • FTSE 100 increased 66.04 points or 0.87% to 7,699.49
  • DAX 30 increased 173.71 points or 1.20% to 14,610.02

 

The major Europe currency markets had a mixed day today:

  • EURUSD increased 0.00992 or 0.94% to 1.06192
  • GBPUSD increased 0.01609 or 1.35% to 1.20669
  • USDCHF decreased 0.00709 or -0.76% to 0.92901

 

 

Some economic news from Europe today:

UK:

Halifax House Price Index (YoY) decreased from 4.6% to 2.0%

Halifax House Price Index (MoM) (Dec) increased from -2.4% to -1.5%

Construction PMI (Dec) decreased from 50.4 to 48.8

Germany:

German Factory Orders (MoM) (Nov) decreased from 0.6% to -5.3%

German Retail Sales (MoM) (Nov) increased from -2.8% to 1.1%

Swiss:

Retail Sales (YoY) (Nov) increased from -2.6% to -1.3%

France:

French Consumer Spending (MoM) (Nov) increased from -2.7% to 0.5%

Euro Zone:

Core CPI (YoY) increased from 5.0% to 5.2%

CPI (YoY) (Dec) decreased from 10.1% to 9.2%

CPI (MoM) decreased from -0.1% to -0.3%

Retail Sales (MoM) (Nov) increased from -1.5% to 0.8%

 

US/AMERICAS:

 

The US Bureau of Labor Statistics released their December jobs report this Friday, noting an increase of 223,000 jobs for the month. The unemployment rate remains at the pre-pandemic level of 3.5%. November’s growth was revised, shedding 7,000 jobs, for a growth rate of 256,000. Leisure and hospitality saw the largest growth (67,000), followed by health (55,000) construction (28,000), and social assistance (20,000). Wage growth rose 4.6% on an annual basis and 0.3% for the month. The Dow soared after the news as wage growth showed signs of cooling, possibly reflecting prices beginning to ease.

 

US Market Closings:

  • Dow advanced 700.53 points or 2.13% to 33,630.61
  • S&P 500 advanced 86.98 points or 2.28% to 3,895.08
  • Nasdaq advanced 264.05 points or 2.56% to 10,569.29
  • Russell 2000 advanced 39.61 points or 2.26% to 1,792.8

 

Canada Market Closings:

  • TSX Composite advanced 307.67 points or 1.58% to 19,814.51
  • TSX 60 advanced 18.7 points or 1.59% to 1,195.34

 

Brazil Market Closing:

  • Bovespa advanced 1,322.38 points or 1.23% to 108,963.7

 

 

ENERGY:

 

The oil markets had a green day today:

 

  • Crude Oil increased 0.998 USD/BBL or 1.36% to 74.668
  • Brent increased 0.846 USD/BBL or 1.08% to 79.536
  • Natural gas increased 0.0508 USD/MMBtu or 1.37% to 3.7708
  • Gasoline increased 0.0321 USD/GAL or 1.42% to 2.2992
  • Heating oil increased 0.0691 USD/GAL or 2.32% to 3.0414

 

The above data was collected around 12:18 EST on Friday

 

  • Top commodity gainers: Platinum (3.00%), Palladium (2.86%), Cotton (3.00%) and Silver (2.83%)
  • Top commodity losers: Lumber (-1.24%), Lean Hogs (-2.32%), Coffee (-1.09%) and Sugar (-1.81%)

 

The above data was collected around 12:26 EST Friday.

 

 

BONDS:

 

Japan 0.500% (+7.8bp), US 2’s 4.29% (-0.164%), US 10’s 3.5839% (-13.81bps); US 30’s 3.70% (-0.094%), Bunds 2.215% (-9.3bp), France 2.723% (-10.9bp), Italy 4.232% (-11.1bp), Turkey 8.49% (-21bp), Greece 4.352% (-9.8bp), Portugal 3.235% (-8.5bp); Spain 3.272% (-10.8bp) and UK Gilts 3.474% (-8bp).