Wolf Money(world market review 13-19 June 2022)

Sandra Hill, Perth, Western Australia 1951

Double Standard circa 2015

Collection of National Gallery of Australia, Canberra 

 

Market Summary 13-19 June 2022

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- Fed raised benchmark interest rate by 75 basis pts, biggest rate hike in 28 years 

- Powell says Fed could hike rates by 0.75% point again in July 

- US producer price index rose 10.8% in May YoY

- US retail sales posted 0.3% decline in May vs estimate 0.1% increase 

+ Biden deciding on China tariffs, says he will speak with Xi soon 

+ Trump era some China tariffs serve 'no strategic purpose': Yellen 

- US factory production output fell 0.1% in May, first decline since Jan   

+ US industrial production up 0.2% in May 

- US stocks sink to lowest value in a year 

- US several hundred CEOs determined most C-suite executive expect recession within 12 mths: survey

- US gasoline prices hit all-time high 

- US 30-year mortgage rates see biggest 1-week jump in 35 years, from 5.23% to 5.78% 

- Wall Street stops servicing Russian debt: Bloomberg 

+ US refiners imported the heaviest crude in early 2 years in May: custom data 

- Biden called on oil refiners to produce more, cut profit margins, in a letter to company heads 

+ Powell: US central bank digital currency (CBDC) could potentially help maintain dollar’s int’l standing 

+ Biden to visit Saudi Arabia in July, due to mee crown prince MBS 

+ US allows energy transactions with sanctioned Russian banks until Dec

- US announced new sanctions on Iranian oil, targeting Chinese, UAE firms 

- US keeps Japan on currency watch list; warns against intervention 

+ US to focus on reducing transportation emissions with more EVs on the road: Biden 

- US financial firms are pushing back on SEC’s proposal aimed at reining in SPACs, arguing it could kill the industry 

+ Warren Buffett’s last lunch auction draws record US$19m bid 

- Tesla makes up nearly 70% of partially autonomous crashes 

- Coco-Cola selling its remaining stock in pulling out of Russian market 

- Elon Musk was sued for US$258bn by a Dogecoin investor, being accused of running pyramid scheme  

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- China’s holdings of US Treasury bonds shrank in April to US$1.003 trillion to lowest level since June 2010 

- China long-term lending fall 40% in May as businesses, homebuyers stay on side-lines 

+ China’s factory output rebounded in May, industrial production rose 0.7% YoY

+ China fixed asset investment for Jan to May period rose 6.2%, retail sales fell 6.7% in May

- China based firms listed in US around 60% of 150 at risk of delisting, US law makers demand deadline to come next year 

+ Xi expresses readiness to help settle Ukrainian crisis: thehindu 

+ China, Russia signed new trade agreement on energy and food

+ China has cut its carbon emissions per unit of GDP by half from 2005 levels 

+ China CAAC to increase regular int’l passenger flights after 2 years of Covid restrictions  

+ China new home prices rising in tier-1 cities in May as pro-growth policies from both central and local govts kicked in 

+ China vowed to spur private investment to realise stable economic growth 

- China tells US will “not hesitate to start war” over Taiwan

+ China launched 3rd aircraft carrier in Shanghai, named the Fujian 

+ China to set up centralised iron ore buyer to counter Australia’s dominance 

+ Chinese CPU maker Loongson prepares for STAR Market IPO with market valuation of US$3.57bn 

+ China’s domestic box office surpasses 1bn yuan in June 1st time after 3 mths 

- HKMA bought HK12.819bn from the market in NY trading hrs to stop local currency weakening and breaking its peg to USD

+ HK’s tight border control rules untenable: Carrie Lam 

+ Taiwan’s export order likely returned to growth in May after first fall in 2 years in April 

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- Japan posted biggest single-mth trade deficit >8 years in May due to high commodity prices and declines in yen 

- BOJ should stick to easing monetary policy: PM Kishida 

- Japan’s inflation to hover around 2% for now: BoJ Kuroda  

- Yen Fall to 24-year low, world’s worst-performing major currency this year 

+ Sony, Honda join forces for EVs

+ Russia earns US98bn from fuel exports in 100 days of Ukraine war: CREA 

+ Russia’s goal is inflation at 4%: Putin 

+ Russia will not have foreign currency accounts frozen: central bank

- Putin estimates EU will incur losses of at least US$400bn related to sanctions imposed on Russia 

+ Russia started to enforce pipe to the East, already redirecting 73% of its oil exports to countries refused to join Western sanctions: Sberbank 

- Russia warned of potential gas disaster for Germany 

+ St Peterburg bourse to add dozen HK-listed stocks including Alibaba, Tencent, JDcom 

- Russian gas deliveries to France interrupted, Gazprom cuts gas delivery to Italy’s Eni by 50% 

- Russia to export agricultural products to friendly countries only 

+ Russia has nothing against Ukraine joining EU: Putin 

+ WTO members secured unprecedented package of trade outcomes at 12th Ministerial Conference

- Bitcoin and other cryptocurrencies plunged as major crypto lender halts operations 

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- ECB policymaker Knot says several 50 bps rate hikes possible if inflation worsens 

- Euro zone inflation confirmed at record high 8.1% in May in line with preliminary estimate by ECB

- EU gas prices spikes as Russia reduces flow

+ EU signed gas deal with Egypt, Israel  

+ European Commission recommended Ukraine receive candidate status for membership in EU 

- German annual inflation nears 50-year peak at 7.9% in May 

- Germany to restart coal-fired power plants and offer incentives for firms to use lees natural gas 

- BoE says inflation will hit 11% in Oct after raising interest rates to 1.25% to 13-year high, cut growth forecast for this qtr 

- UK food prices could spike at 15% this summer 

- UK disposable income to tall at fastest rate since 1950s: report 

+ Italy’s Eni joined Qatar Energy’s projects to expand production after Russia cuts supplies 

+ Ferrari to make 80% hybrid and full-electric range by 2030, to debut SUV-like model in Sept 

- Ikea to sell inventory, find new owners for its 4 factories of Russia business 

- Hungary said couldn’t give support to EU agreement on minimum corporate tax of 15% at this point

- Turkey’s annual inflation to reach 80% before easing to 60% by end 2022:  Goldman Sachs 

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+ Qantas, airbus to invest up to US$200m to develop Australian sustainable aviation fuel industry 

- India confident exiting ultra-loose monetary policy smoothly, ensuring soft landing for economy: central bank

+ Indian to begin 5G deployment in Aug 22: minister 

+ South Korea, China trade increase 10.2% in first five mths

+ Qatar Airways posted record US$1.5bn profits

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+ Indonesia plans to export 200,000 tons of rice to China, Malaysia and several other countries next mth 

+ Indonesia’s trade surplus widened to US$2.9bn in May from US$2.7bn YoY despite palm oil export ban 

+ Jokowi names new trade minister after palm oil ban controversy 

- Thailand govt asked refinery companies to channel profits into Oil Fuel Fund for 3 mths to help control fuel prices 

+ Thailand to abandon pre-registration process for foreign visitors and requirement for face mask to be worn in public 

+ Vietnam’s minimum wage to rise 6% in July after pandemic freeze

+ Vietnam’s domestic aviation market has been recovering fastest pace in the world  

+ Philippines tycoon unveiled plans to construct world’s largest solar farm 

- Laos plans to ban residents from holding foreign currencies amid spiralling inflation 

- Myanmar’s economy in chaos, outlook impossible: World Bank 

+ Malaysia’s economic growth expected to increase further in Q2 and Q3: minister 

- Malaysia firms from palm oil plantations to semiconductor makers are turning down orders due to shortage of workers 

 + Malaysia partially lifts ban on poultry exports, allows kampung, black chicken to be exported to Singapore 

+ Malaysia Airlines nearing decision on replacing 21 A339s: CEO

+ Malaysia several conglomerates in talks to secure mega projects in Indonesia worth up to RM7bn 

- Touch n Go e-wallet expands across border payment service to Singapore 

+ Sg NODX rise 12.4% in May from 6.4% in April  

+ Sg job vacancies at record high of 128,100 in Q1: MOM

+ Sg employment grew by 42,000 in Q1, which is 5900 less from previous qtr 

+ Sg new home sales soar to 6-mth high in May with 1356 units sold, resale condo price up 0.3%  

+ Sg condo resale prices rose for 22nd straight mth in May, up 1.6% MoM and 8.4% YoY 

+ SIA passengers rose by 1325% YoY in May 

+ Sinovac to invest S$2bn in development plan includes opening a research facility and int’l HQ in Singapore 

Contribution by Derek@valueinvestments chat group. Thank you.

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