Market Talk – May 25, 2021

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ASIA:

Cryptocurrency miners, including HashCow and BTC.TOP, have halted all or part of their China operations after Beijing intensified a crackdown on bitcoin mining and trading, hammering digital currencies amid heightened global regulatory scrutiny. Cryptocurrency exchange Huobi on Monday suspended both crypto-mining and some trading services to new clients from mainland China, adding it will instead focus on overseas businesses. A State Council committee led by Vice Premier Liu He announced the crackdown late on Friday as part of efforts to fend off financial risks. It was the first time China’s cabinet has targeted virtual currency mining, a sizable business in the world’s second-biggest economy that some estimates say accounts for as much as 70% of the global crypto supply. The crackdown is also part of China’s stepped-up drive to curb speculative crypto trading.

Automakers Renault, its alliance partner Nissan Motor Co and Hyundai Motor Co face temporary factory closures in India due to growing unrest among workers concerned about rising COVID-19 infections. Workers at Renault-Nissan’s car plant in the southern state of Tamil Nadu will go on strike on Wednesday because their COVID-related safety demands have not been met, a union representing the workers told the company in a letter on Monday. Hyundai said it would suspend operations at its plant, also in Tamil Nadu, for five days starting Tuesday, after several workers staged a brief, sit-in protest on Monday amid rising cases in the state.

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 increased 189.37 points or 0.67% to 28,553.98
  • Shanghai increased 84.06 points or 2.40% to 3,581.34
  • Hang Seng increased 498.60 points or 1.75% to 28,910.86
  • ASX 200 increased 69.30 points or 0.98% to 7,115.20
  • Kospi increased 27.02 points or 0.86% to 3,171.32
  • SENSEX decreased 14.37 points or -0.03% to 50,637.53
  • Nifty50 increased 10.75 points or 0.07% to 15,208.45

The major Asian currency markets had a mixed day today:

  • AUDUSD decreased 0.0013 or -0.17% to 0.77390
  • NZDUSD decreased 0.00001 or 0.00% to 0.72149
  • USDJPY increased 0.13 or 0.12% to 108.96
  • USDCNY decreased 0.00428 or -0.07% to 6.40846

Precious Metals:

  • Gold increased 11.38 USD/t oz. or 0.60% to 1,892.45
  • Silver increased 0.08 USD/t. oz or 0.28% to 27.878

Some economic news from last night:

South Korea:

Consumer Confidence (May) increased from 102.2 to 105.2

Singapore:

GDP (QoQ) (Q1) increased from 2.0% to 13.1%

GDP (YoY) (Q1) increased from 0.2% to 1.3%

 

Some economic news from today:

Japan:

BoJ Core CPI (YoY) decreased from 0.0% to -0.1%

Singapore:

Industrial Production (MoM) (Apr) increased from -1.7% to 1.0%

Industrial Production (YoY) (Apr) decreased from 7.6% to 2.1%

Indonesia:

Deposit Facility Rate (May) remain the same at 2.75%

Lending Facility Rate (May) remain the same at 4.25%

Loans (YoY) (Apr) increased from -3.80% to -2.28%

 

EUROPE/EMEA:

Britain is launching a 14-week consultation on a future trade deal with India, seeking the views of the public and business before trade minister Liz Truss hopes to begin talks later this year. A trade accord with India is seen as a key target for post-Brexit Britain. Since completing its exit from the European Union at the end of last year, Britain is keen to secure trade deals and is particularly pursuing ties with nations in the Indo-Pacific region, home to some of the fastest growing economies.

Fitness classes have recorded a sharp rise in sales as British consumers return to the gym after lockdown despite demand for online sessions that experts say will persist after the coronavirus pandemic. ClassPass, a company that provides access to fitness classes across the UK, said in the past week it had recorded a 600% week-on-week increase in the number of new members as lockdown measures were relaxed.

France’s European affairs minister warned Britain not to play games with special post-Brexit trading rules for Northern Ireland, as fears rise of a summer of violence in the province. Clément Beaune urged London to be “responsible” over the so-called “protocol” for Northern Ireland, which kept it in the EU single market and customs union despite the UK’s departure from the bloc.

The major Europe stock markets had a mixed day:

  • CAC 40 decreased 18.22 points or -0.28% to 6,390.27
  • FTSE 100 decreased 21.80 points or -0.31% to 7,029.79
  • DAX 30 increased 27.58 points or 0.18% to 15,465.09

 

The major Europe currency markets had a mixed day today:

  • EURUSD increased 0.00226 or 0.19% to 1.22368
  • GBPUSD decreased 0.00257 or -0.18% to 1.41311
  • USDCHF decreased 0.00025 or -0.03% to 0.89662

Some economic news from Europe today:

Norway:

Consumer Confidence (Q2) increased from -3.20 to 2.50

UK:

Public Sector Net Borrowing (Apr) increased from 25.53B to 30.96B

Public Sector Net Cash Requirement (Apr) increased from 15.581B to 33.564B

CBI Distributive Trades Survey (May) decreased from 20 to 18

Germany:

German GDP (YoY) (Q1) decreased from -3.3% to -3.4%

German GDP (QoQ) (Q1) decreased from 0.3% to -1.8%

German Business Expectations (May) increased from 99.2 to 102.9

German Current Assessment (May) increased from 94.2 to 95.7

German Ifo Business Climate Index (May) increased from 96.6 to 99.2

Spain:

Spanish PPI (YoY) increased from 6.4% to 12.8%

US/AMERICAS:

Home prices soared to its highest level in 15 years this March, according to the S&P CoreLogic Case-Shiller National Home Price Index. US home increased 13.2% in value YoY this March, beating February’s YoY gain of 12%. The 10-City Composite spiked 12.8%, while the 20-City Composite rose 13.3%. Seattle (18.3%), Phoenix (20%), and San Diego (19.1%) saw the most significant price increases. While demand remains high, housing availability remains sparse with only 1.16 million homes available this April, representing a 20% decline YoY.

President Biden will meet with Russian President Putin on June 16 in Geneva. Biden began his presidency on poor grounds with Putin after calling him a “killer” and then denying Putin’s request for a debate. The US sanctioned numerous Russian officials for allegedly poisoning Putin’s top critic, Alexi Navalny. Furthermore, Russia has been involved in numerous cyber attacks against the US, such as the Colonial Pipeline hack that disrupted America’s fuel supply chain. The leaders will discuss the full range of pressing issues, as we seek to restore predictability and stability to the U.S.-Russia relationship,” the White House stated this Tuesday.

Florida Chief Financial Officer Jimmy Patronis noted that nearly 900 people are migrating from northern states to Florida daily. Patronis said the exodus is due to people wanting to escape “tax hell.” Senator Rick Scott previously stated that it has been easier than ever to recruit companies to Florida. “But the easiest were, gosh, Cuomo is a great he… was my best recruiter because he kept raising taxes. And I mean… he’s just been unbelievable for Florida. But Illinois, all across the Midwest, people come to Florida because they like lower taxes. But Illinois, New York, New Jersey, Connecticut, California — those are places people are moving from,” Scott stated. However, concerns are rising that people flocking from the north will also bring their voting habits. “I think a lot of these Democratic governors just want to control your life. I mean, look, everybody can get a vaccine now. I mean, it’s so why aren’t schools open, why aren’t our businesses open? Why can’t we go back to church?” Senator Scott questioned. “The Democrats, they just want to control your life… They want to give you everything for free and then tell you how to lead your life. I mean, we all want to lead our own lives. I don’t need the government tell me what to do.”

US Market Closings:

  • Dow declined 81.52 points or -0.24% to 34,312.46
  • S&P 500 declined 8.92 points or -0.21% to 4,188.13
  • Nasdaq declined 4 points or -0.03% to 13,657.17
  • Russell 2000 declined 21.59 points or -0.97% to 2,205.75

Canada Market Closings:

  • TSX Composite advanced 36.82 points or 0.19% to 19,564.12
  • TSX 60 advanced 2.98 points or 0.25% to 1,172.46

 

Brazil Market Closing:

  • Bovespa declined 1,043.91 points or -0.84% to 122,987.71

ENERGY:

 

The oil markets had a mixed day today:

 

  • Crude Oil decreased 0.08 USD/BBL or -0.12% to 65.9700
  • Brent decreased 0.01 USD/BBL or -0.01% to 68.4500
  • Natural gas increased 0.02 USD/MMBtu or 0.66% to 2.9050
  • Gasoline decreased 0.00 USD/GAL or -0.08% to 2.1161
  • Heating oil decreased 0.01 USD/GAL or -0.37% to 2.0344

 

  • Top commodity gainers: Palm Oil (2.49%), Coal (1.24%), Bitumen (2.11%) and Palladium (1.23%)
  • Top commodity losers: Corn (-5.10%), Wheat (-1.70%), Lumber (-2.88%), and Orange Juice (-1.92%)

 

The above data was collected around 11:50 EST on Tuesday.

 

BONDS:

 

Japan 0.0750%(-0bp), US 2’s 0.15%(-0.002%), US 10’s 1.5808%(-3bps); US 30’s 2.27%(-0.026%), Bunds -0.1650% (-3bp), France 0.199% (-4bp), Italy 0.9612% (-6bp), Turkey 17.52% (+5bp), Greece 0.9040% (-7bp), Portugal 0.498% (-5bp); Spain 0.50% (-4bp) and UK Gilts 0.789% (-2bp).

 

  • German 12-Month Bubill Auction increased from -0.639% to -0.638%
  • French 12-Month BTF Auction decreased from -0.626% to -0.632%
  • French 3-Month BTF Auction decreased from -0.626% to -0.629%
  • French 6-Month BTF Auction decreased from -0.630% to -0.635%
  • US 2-Year Note Auction decreased from 0.175% to 0.152%