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Market Talk – September 15, 2020

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China’s industrial output accelerated the most in eight months in August, while retail sales grew for the first time this year, suggesting the economic recovery is gathering pace as demand starts to improve more broadly from the coronavirus crisis. Industrial output growth quickened to 5.6% in August from a year earlier, the fastest in eight months, data from the National Statistics Bureau showed on Tuesday. Retail sales also beat analysts’ forecast with a 0.5% rise on-year, snapping a seven-month downturn and bettering expectations for zero growth. Auto sales rose 11.8% in August year-on-year while sales of telecoms products jumped 25.1%, the data showed.

India’s government sought parliamentary approval to inject USD 2.72 billion in state-run banks in the current fiscal year, to help lenders mitigate the expected surge in bad loans due to the pandemic. The pandemic’s impact is likely to push up the ratio of gross non-performing assets in the Indian banking system to at least 12.5% by March 2021, from 8.5% in March 2020, according to a report by the Reserve Bank of India.

India’s annual retail inflation eased slightly in August as food inflation cooled, but remained above the upper end of the central bank’s medium-term target for the fifth straight month, government data showed on Monday. Retail inflation in August of 6.69% was lower than the 6.85% forecast in a Reuters poll of analysts and the 6.73% registered in July.

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 decreased 104.41 points or -0.44% to 23,454.89
  • Shanghai increased 16.87 points or 0.51% to 3,295.68
  • Hang Seng increased 92.48 points or 0.38% to 24,732.76
  • ASX 200 decreased 4.70 points or -0.08% to 5,894.80
  • Kospi increased 15.67 points or 0.65% to 2,443.58
  • SENSEX increased 287.72 points or 0.74% to 39,044.35
  • Nifty50 increased 81.75 points or 0.71% to 11,521.80

The major Asian currency markets had a mixed day today:

  • AUDUSD increased 0.00156 or 0.21% to 0.73008
  • NZDUSD increased 0.00124 or 0.19% to 0.67120
  • USDJPY decreased 0.29 or -0.27% to 105.45
  • USDCNY decreased 0.03039 or -0.45% to 6.77949


Precious Metals:

  • Gold decreased 1.72 USD/t oz. or -0.09% to 1,954.65
  • Silver decreased 0.02 USD/t. oz or -0.06% to 27.140


Some economic news from last night:


Fixed Asset Investment (YoY) (Aug) increased from -1.6% to -0.3%

Industrial Production (YoY) (Aug) increased from 4.8% to 5.6%

Chinese Industrial Production YTD (YoY) (Aug) increased from -0.4% to 0.4%

Retail Sales (YoY) (Aug) increased from -1.1% to 0.5%

Chinese Retail Sales YTD (YoY) (Aug) increased from -10.44% to -9.21%

Chinese Unemployment Rate decreased from 5.7% to 5.6%

South Korea:

Export Price Index (YoY) (Aug) decreased from -5.3% to -6.8%

Import Price Index (YoY) (Aug) decreased from -8.9% to -10.5%

Exports (YoY) (Aug) decreased from -9.9% to -10.1%

Imports (YoY) (Aug) increased from -16.3% to -15.8%

Trade Balance (Aug) decreased from 4.12B to 3.84B


House Price Index (QoQ) (Q2) decreased from 1.6% to -1.8%

New Zealand:

Westpac Consumer Sentiment (Q3) decreased from 97.2 to 95.1


Some economic news from today:


Exports (USD) (Aug) decreased from 23.64B to 22.70B

Imports (USD) (Aug) increased from 28.47B to 29.47B

Trade Balance (Aug) decreased from -4.83B to -6.77b


Export Growth (YoY) (Aug) increased from -9.90% to -8.36%

Import Growth (YoY) (Aug) increased from -32.55% to -24.19%

Trade Balance (Aug) decreased from 3.26B to 2.33B

New Zealand:

GlobalDairyTrade Price Index increased from -1.0% to 3.6%



UK may face a bigger economic disaster and would be more costly than dealing with the coronavirus, if failing to reach a trade deal with the European Union, Goldman Sachs economists have warned. Some analysts have suggested that these costs would blend in with the hit to the UK economy from the global pandemic, making it difficult to determine what will be the real source of economic pain in the years to come. However, Goldman Sachs economists disagree. The UK government has over the last week challenged previous commitments with the European Union, increasing the odds that both sides will not manage to put a trade agreement together before the end of the year. This “no-deal” outcome would result in higher costs for exporters on both sides.

Almost 600 UK-based Emirates employees risk losing their jobs after the airline warned its employees of the need to “consider reducing the size of the UK workforce.” The United Arab Emirates flag carrier stated that quarantine, border controls and other travel restrictions had left passenger demand “extremely subdued,” the Telegraph reported.

Tour de France organizer ASO has confirmed that no riders or staff tested positive for COVID-19 coronavirus on the second rest day, meaning all the riders and teams can now continue in the race with the goal of reaching Paris next Sunday. ASO said 785 tests were carried out on the second rest day in the Alps and all “returned negative results.”

The major Europe stock markets had a green day:

  • CAC 40 increased 16.05 points or 0.32% to 5,067.93
  • FTSE 100 increased 79.29 points or 1.32% to 6,105.54
  • DAX 30 increased 24.01 points or 0.18% to 13,217.67


The major Europe currency markets had a mixed day today:

  • EURUSD decreased 0.0022 or -0.19% to 1.18454
  • GBPUSD increased 0.00401 or 0.31% to 1.28888
  • USDCHF decreased 0.00014 or -0.02% to 0.90824


Some economic news from Europe today:


Average Earnings ex Bonus (Jul) increased from -0.2% to 0.2%

Average Earnings Index +Bonus (Jul) increased from -1.2% to -1.0%

Claimant Count Change (Aug) increased from 69.9K to 73.7K

Employment Change 3M/3M (MoM) (Jul) increased from -220K to -12K

Unemployment Rate (Jul) increased from 3.9% to 4.1%



Trade Balance (Aug) decreased from -1.8B to -2.9B

Norges Bank regional network Survey increased from 0.08 to 0.19


PPI (YoY) (Aug) decreased from -3.3% to -3.5%

PPI (MoM) (Aug) decreased from 0.1% to -0.4%


French CPI (MoM) (Aug) decreased from 0.4% to -0.1%

French CPI (YoY) decreased from 0.8% to 0.2%

French HICP (MoM) (Aug) remain the same at -0.1%

French HICP (YoY) (Aug) decreased from 0.9% to 0.2%


Italian CPI (MoM) (Aug) increased from -0.2% to 0.3%

Italian CPI (YoY) (Aug) decreased from -0.4% to -0.5%

Italian CPI Ex Tobacco (MoM) (Aug) decreased from -0.4% to -0.7%

Italian HICP (MoM) (Aug) remain the same at -1.3%

Italian HICP (YoY) (Aug) remain the same at -0.5%


German ZEW Current Conditions (Sep) increased from -81.3 to -66.2

German ZEW Economic Sentiment (Sep) increased from 71.5 to 77.4

Euro Zone:

Wages in euro zone (YoY) (Q2) increased from 3.90% to 5.20%

Labor Cost Index (YoY) (Q2) increased from 3.70% to 4.20%

ZEW Economic Sentiment (Sep) increased from 64.0 to 73.9

Reserve Assets Total (Aug) decreased from 923.07B to 915.08B


The Federal Reserve began its two-day meeting this Tuesday as the world skeptically awaits to hear their current outlook on monetary policy. The current inflation target of 2% is suspected to change based on Chairman Powell’s comments last month: “Following periods when inflation has been running below 2%, appropriate monetary policy will likely aim to achieve inflation moderately above 2% for some time.” Rates are expected to hold steady at their current historic low of near 0%. According to a CNBC poll, analysts are expecting rates to remain the same until 2023. The central bank will make an official announcement tomorrow afternoon as the marketplace speculates their decision.

Walmart launched an online delivery membership program to compete with Amazon Prime called Walmart Plus. The service will cost $98 annually, similar to Amazon Prime’s $119 annual fee, and will also offer unlimited free delivery services.

House Speaker Nancy Pelosi announced that she plans to hold session until a final coronavirus relief bill is reached. Pelosi rejected the Republican’s self-described “skinny” coronavirus relief plan, calling the $300 billion bill “emaciated.” Republican Senate Majority Leader Mitch McConnell accused Pelosi of having an unrealistic “wish list” for the next relief plan.

The US has abandoned tariffs on Canadian aluminum. US Trade Representative Lighthizer said that the US will review trade patterns with Canada in 2021, and would consider reimplanting the tariffs if there was a “surge” in aluminum imports. Deputy Prime Minister Chrystia Freeland called the decision “good news” for both the US and Canada, as Canada was prepared to hit back with retaliatory measures on $3.6 billion worth of US goods.

US Market Closings:

  • Dow advanced 2.27 points or 0.01% to 27,995.6
  • S&P 500 advanced 17.66 points or 0.52% to 3,401.2
  • Nasdaq advanced 133.67 points or 1.21% to 11,190.32
  • Russell 2000 advanced 1.18 points or 0.08% to 1,538.15

Canada Market Closings:

  • TSX Composite advanced 71.13 points or 0.43% to 16,431.27
  • TSX 60 advanced 3.5 points or 0.36% to 983.64

Brazil Market Closing:

  • Bovespa advanced 23.39 points or 0.02% to 100,297.91


The oil markets had a green day today:

  • Crude Oil increased 1.12 USD/BBL or 3.01% to 38.3800
  • Brent increased 1 USD/BBL or 2.52% to 40.6100
  • Natural gas increased 0.059 USD/MMBtu or 2.57% to 2.3590
  • Gasoline increased 0.0257 USD/GAL or 2.32% to 1.1325
  • Heating oil increased 0.0108 USD/GAL or 0.99% to 1.0992

The above data was collected around 16:50 EST on Tuesday.

  • Top commodity gainers: Oat (3.86%), Palladium (4.10%), Cocoa (5.25%), and Copper (3.66%)
  • Top commodity losers: Soybeans (-1.71%), Wheat (-1.91%), Lumber (-6.55%), and Rubber (-1.74%)

The above data was collected around 16:59 EST on Tuesday.


Japan 0.01%(-0bp), US 2’s 0.14% (+0bps), US 10’s 0.68%(+0bps); US 30’s 1.43%(+2bps), Bunds -0.47% (+0bp), France -0.20% (+0bp), Italy 0.99% (-2bp), Turkey 12.82% (-13bp), Greece 1.06% (-1bp), Portugal 0.27% (-2bp); Spain 0.25% (+3bp) and UK Gilts 0.21% (+2bp).