Wolf Money(world market review 20-26 June 2022)

 

Preecha Thaothong Thailand 1948 

Temple Interior circa 1975 

Collection of National Gallery Singapore 

Market Summary 20-26 June 2022

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+ US economy will ‘narrowly avoid’ recession in 2022 and 2023 as Fed implements rate-tightening to curb inflation: IMF

+ US all 34 banks passed 2022 stress test, remained above minimum capital requirement: Fed 

+ US central bank’s balance sheet should be “roughly” US$2.5 – US$3 trillion lower compared to current situation, down to size Fed could conduct monetary policy: Powell 

- US gas-tax holiday is certainly “worth considering” as Americans have been burdened by record-high gas prices: Yellen 

+ US inflation to fall close to target of 2% in next years: Powell 

- US existing home sales down 3.4% in May vs previous mth and 8.6% annually 

- US has not seen full effect of China lockdowns: Powell 

+ Biden to visit Saudi Arabia to ask for increase in oil production 

+ US govt is moving forward on China tariffs, Biden to consider possible decisions 

- US services sector activity at 5-mth low at 51.6 in June vs 53.4 in previous mth 

+ Powell: stablecoins should be regulated at federal level 

+ US oil inventories rise by 5.6m barrels: API 

+ US senate passed bipartisan gun safety bill, breaking nearly 3 decades of inaction 

- FDA ordered Juul to stop selling e-cigarettes in US 

- Blackstone-Led Gp provides US$5bn of debt to help fund leveraged buyout of software maker Zendesk 

- Tesla’s Texas, Berlin factories losing billions of dollars due to shortage of batteries and China lockdown: Musk 

+ Apple seeks automotive software engineers in Beijing, Shanghai and Shenzhen, indicates CarPlay push in China 

- Nike latest brand to leave Russia permanently 

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+ China is working on improving its openness to exterior and welcomes any foreign investments that would aid development: Xi

+ China’s core AI industry exceeded US$59.74bn, related enterprises exceeded 3000, smart chips, open-source frameworks technology achieve major breakthrough: minister  

+ Chinese cities rushed to issue local govt bonds under central govt guidelines, Shanghai quota expected to se 46% YoY increase 

+ China mulls extending EV tax break to help Covid-hit sector 

+ Beijing Stock Exchange welcomes 100th listed firm this week 7 mths after opening 

+ Shanghai total cash supply from June 1 to 5 increases nearly 4 times YoY: central bank

- Chinese imports of LNG from US plunged by 95% between Feb and Apr YoY as it ramped up purchases from Russia  

+ China resumed more int’l flights as Covid curbs ease 

+ Chinese property developers in 3rd and 4th tier cities encourage buyers to pay down payment with wheat and garlic 

+ Country Garden announced US$441m bond buyback, 60% of outstanding principal on an offshore due in July 

- China’s trust industry profit decline 31% to US$1.85bn in Q1, operating revenue down 28% YoY  

+ China’s costal provinces to push for sustainable fisheries development 

- China demand for electricity in many provinces set new records at 844m kilowatts amid searing heat and robust factory activity in June   

+ China completed building world’s largest 24,000-TEU container ship by CSSC in Shanghai 

- China’s nearly 80% Logistics firms report falling profits by up to 30% in first 5 mths: survey 

+ TikTok’s Chinese Twin wins right to stream FIFA world cup, it’s revenue on track to triple to US$12bn 

+ HKMA steps up purchases of its local dollar to defend currency peg as faces capital outflows 

+ HK still an IPO magnet for global firms, China startups: UBS 

+ HK audit regulator in talks with Beijing to inspect mainland firms 

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- BoJ will not hesitate to implement further monetary easing in order to maintain stability of financial system, timely recovery

+ Japan’s inflation remains at 2.5% in May at 7 years high 

+ Japan’s composite output index rose by 0.9 pts in May to 53.2 in June

- Sony steps up image sensor tech, targeting 60% market share, hold off rapid gains by Samsung and other players 

- Nikkei poll: 46% in Japan want BOJ to halt ultraloose policy 

- Russia closer to default with bond deadlines looming due to cutting off avenues to transfer cash 

+ Bank of Russia to consider further lowering key rate, ruble hit 7-year high vs USD

- Russia might completely cut gas to Europe: IEA 

+ Russia commodities traders replaced Switzerland with Dubai 

+ Russia becomes China’s top oil supplier: media 

- Canadian inflation hits 7.7% YoY in May, highest since 1983 

- G7 to ban imports of Russian Gold to tightening sanctions 

- WHO considers declaring monkeypox ‘emergency of int’l concern’ as Asia reports more imported cases 

+ BRICS to expand green energy, digital cooperation to tackle climate change 

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- Europe is now in its worst corporate-bond selloff in decades, surpassing 2008 GFC

- ECB likely to hike key interest rates by 25 basis pts in July, 50 basis points in Sept: Kazimir 

- ECB: gradual rate hikes to be appropriate after Sept 

- Eurozone’s PMI composite output index down to 51.9 in June to 16-mth low: S&P Global 

+ European 2/3 companies operating in China saw revenues grew 24% YoY in 2021 

+ EU says Russian food and fertilizer are free from sanctions 

+ EU country to launch test route for Ukraine grain

- Germany producer price inflation rose at record pace in May to 33.6% YoY following April’s 33.5% increase 

- German business climate index fell to 92.3 in June from 93 in May, below expectations: Ifo

- Germany plans to nationalise parts of Nord Stream 2 gas pipeline: report 

+ BMW, Volkswagen announced plans for new factories and expanded production in China 

- UK inflation increased by 9.1% YoY in May, highest in 40 years; “worse is yet to come”: BoE  

- UK retail sales volume declines 0.5% in May compared to previous mth 

- Spain’s La Liga terminates broadcasting deal with Chinese partner after Wuhan DDMC’s Super Sports missed US$47m payment 

+ Norway plans to increase gas deliveries to EU 

- Demark dozens of companies face closure if energy supply is reduced: industry gp 

+ Ukraine will “very likely” become EU member: Biden 

- Israel to dissolve parliament and call 5th election in 3 years 

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- Australia central bank says more rate hikes will be needed 

+ India says ready to help Sri Lanka in quick economic recovery 

- Sri Lanka in talks with IMF as govt moves to cut President’s powers, halted all non-essential govt services, beginning a 2-week shutdown to conserve fast-depleting fuel reserves 

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- indonesia’s rate should rise sooner rather than later: HSBC

+ Thailand declared whole nation a green zone, allowing full-scale resumption of business and other activities, lifts mandatory mask rule for both indoor and outdoor

+ Thailand’s reopening and push for economic recovery expected to generate double-digit growth in employment rate 

- Vietnam’s first metro line Hanoi Metro starts running at a loss 

+ Malaysia plans record RM77.3bn in subsidies and cash aid to help rising prices, largest amount in history 

- Malaysia Carsome to delay its US-Singapore dual listing amid valuation concerns 

+ Sg factory output grows 13.8% in May as semiconductors productions surges 

- Sg headline CPI rose to 5.6% YoY in May, core inflation up 3.6%, highest in >13 years, led by rising prices of food and utilities

+ Sg announced S$1.5bn support package to help lower-income households 

+ Sg commences first renewable energy electricity import up to 100 megawatts from Laos through Thailand and Malaysia  

- Sg COE premiums for larger cars stay above S$100,000 for 2nd consecutive bidding exercise 

+ Sg expect to get 1000 jobs created by chip giant GlobalFoundries with new plant on track to open in 2023 

Contribution by Derek@valueinvestments chat group. Thank you.

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