Market Talk – September 21, 2020

ASIA:

ByteDance and Oracle Corp issued conflicting statements on Monday over the terms of an agreement they reached with the White House over the weekend to allow TikTok to continue to operate in the United States. ByteDance said on Monday that it would own 80% of TikTok Global, a newly created US company that will own most of the app’s operations worldwide. ByteDance added that TikTok Global will become its subsidiary. Oracle and Walmart Inc, which have agreed to take stakes in TikTok Global of 12.5% and 7.5% respectively, had said on Saturday that majority ownership of TikTok would be in American hands. On Monday, Oracle said ByteDance’s ownership of TikTok would be distributed to ByteDance’s investors, and that the Beijing-based firm would have no stake in TikTok Global.

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 closed
  • Shanghai decreased 21.15 points or -0.63% to 3,316.94
  • Hang Seng decreased 504.72 points or -2.06% to 23,950.69
  • ASX 200 decreased 41.90 points or -0.71% to 5,822.60
  • Kospi decreased 23.01 points or -0.95% to 2,389.39
  • SENSEX decreased 811.68 points or -2.09% to 38,034.14
  • Nifty50 decreased 254.4 points or -2.21% to 11,250.55

 

The major Asian currency markets had a mixed day today:

  • AUDUSD decreased 0.00703 or -0.96% to 0.72216
  • NZDUSD decreased 0.0093 or -1.38% to 0.66672
  • USDJPY increased 0.13 or 0.13% to 104.69
  • USDCNY increased 0.01481 or 0.22% to 6.79339

Precious Metals:

  • Gold decreased 36.99 USD/t oz. or -1.90% to 1,912.70
  • Silver decreased 2.01 USD/t. oz or -7.49% to 24.759

Some economic news from last night:

China:

PBoC Loan Prime Rate remain the same at 3.85%

New Zealand:

Credit Card Spending (YoY) decreased from -5.0% to -11.9%

Some economic news from today:

Hong Kong:

CPI (YoY) (Aug) increased from -2.30% to -0.40%

EUROPE/EMEA:

Germany’s largest support organization in the field of international academic cooperation, the German Academic Exchange Service, widely known as DAAD, has asked from the German Ministry of Foreign Affairs to resume visa application procedures for students from third countries. The request has been directed to the Ministry after thousands of students have ‘protested’ through social medial the closure of German Embassies and visa centers, claiming they risk losing their place at German universities for not succeeding to get their visa on time.

The major Europe stock markets had a negative day today:

  • CAC 40 decreased 186.14 points or -3.74% to 4,792.04
  • FTSE 100 decreased 202.76 points or -3.38% to 5,804.29
  • DAX 30 decreased 573.81 points or -4.37% to 12,542.44

The major Europe currency markets had a mixed day today:

  • EURUSD decreased 0.00724 or -0.61% to 1.17687
  • GBPUSD decreased 0.01032 or -0.80% to 1.28145
  • USDCHF increased 0.00336 or 0.37% to 0.91465

Some economic news from Europe today:

Spain:

Spanish Trade Balance decreased from 1.48B to -0.31B

US/AMERICAS:

A number of major financial institutions, including JPMorgan Chase, HSBC, and Deutsche Bank, were allegedly involved in a multi-trillion dollar money laundering scheme. An international compliance agency flagged over $2 trillion worth of transactions between 1999-2017. Over 2,100 counts of “suspicious activity” were reported to the Department of Treasury’s Financial Crimes Enforcement Network and a further investigation will ensue.

Dallas Federal Reserve President Robert Kaplan told reporters at Reuters that he foresees US employment returning to pre-pandemic levels by late 2022 or 2023. For the current year, Kaplan believes unemployment could fall to 7.25%. Although he is in agreement with the Fed’s recent decision to maintain low rates, he noted that it poses  the threat of “risk- taking and maybe create imbalances and instabilities” and questioned how “accommodating” the central bank should be.

Justice Ruth Bader Ginsburg passed away on Friday from pancreatic cancer at the age of 87. President Trump announced on Monday morning that he plans to appoint a new Supreme Court justice by Friday or Saturday, but others in his administration are saying a new appointment could happen as soon as Wednesday. Democrats are attempting to protest the president’s elected right to appoint a new judge by saying the decision should be made after election day.

New businesses are emerging due to the coronavirus, starting with the company Civvl that is recruiting freelance workers to help landlords evict tenants. Dubbed the “fasting growing money making gig due to covid-19,” the company is looking for workers to serve papers and post notices on behalf of unpaid landlords. In a letter to Business Insider, the company denied profiting off of the hardships caused by coronavirus shutdown. “We are accumulating a growing database of independent contractors looking to carry out this foreseeable future of upcoming events,” a representative stated. Recent data shows that around 29% of Americans could not pay their rent or mortgage in full at the beginning of the month.

US Market Closings:

  • Dow declined 509.72 points or -1.84% to 27,147.7
  • S&P 500 declined 38.41 points or -1.15% to 3,281.06
  • Nasdaq declined 14.48 points or -0.13% to 10,778.8
  • Russell 2000 declined 51.53 points or -3.35% to 1,485.25

Canada Market Closings:

  • TSX Composite declined 217.2 points or -1.34% to 15,981.77
  • TSX 60 declined 10.5 points or -1.08% to 957.71

Brazil Market Closing:

  • Bovespa declined 1,298.99 points or -1.32% to 96,990.72

ENERGY:

The oil markets had a negative day today:

  • Crude Oil decreased 1.5 USD/BBL or -3.65% to 39.6100
  • Brent decreased 1.4 USD/BBL or -3.24% to 41.7500
  • Natural gas decreased 0.179 USD/MMBtu or -8.71% to 1.8770
  • Gasoline decreased 0.051 USD/GAL or -4.13% to 1.1840
  • Heating oil decreased 0.0449 USD/GAL or -3.88% to 1.1117

 

  • Top commodity gainers: L Rubber (0.25%), Coffee (0.13%), Coal (1.10%), and Feeder Cattle (0.16%)
  • Top commodity losers: Silver (-7.49%), Natural Gas (-8.71%), Gasoline (-4.13%), and Platinum (-4.93%)

The above data was collected around 17:05 EST on Monday.

BONDS:

Japan 0.00%(-1bp), US 2’s 0.14% (-0bps), US 10’s 0.66%(-3bps); US 30’s 1.42%(-4bps), Bunds -0.49% (-1bp), France -0.23% (+1bp), Italy 0.92% (-4bp), Turkey 13.44% (+23bp), Greece 1.06% (-0bp), Portugal 0.25% (-4bp); Spain 0.23% (-5bp) and UK Gilts 0.16% (-2bp).