Wolf Money(world market review 26 Sept - 2 Oct 2022)

 

Lim Kwong Ling Singapore 1932

Untitled circa 1970s

Gift of the artist and family

Collection of the National Gallery

Market Summary 26 Sept -2 Oct 2022

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- US PCE price index rose 0.3% MoM, topping estimates 

- US GDP contracted 0.6% in Q2 YoY, less than 0.9% drop announced in initial estimate last mth

- US 30-fixed home mortgage rate hit 6.7%, highest since 2007 

+ US consumer confidence grows further in Sept to 108 versus 103.6 in Aug 

- US trade deficit at US$87.3bn in Aug, down by US$2.9bn from revised figure of US$90.2bn in July 

- Biden: destruction from Hurricane Ian likely to be among worst in US history 

+ US sales of new single-family houses up 28.8% in Aug to 685,000, pending home sales fall 2%

- US Democrats and Republicans lawmakers are pushing White House to screen US investment in China 

- SEC fines Deloitte’s China affiliate US$20m for auditing violations 

- FAA says Boeing has not completed work needed for 737 MAX approval 

+ US oil inventories up by 4.15m barrels 

- US NY AG pushing for Trump’s trail to start before end 2023 

+ Intel’s self-driving unit Mobileye files for US IPO

- Amazon raises hourly wages at cost of almost US$1bn a year 

- Apple down 4% on report it won’t boost iPhone production 

+ Tesla unveiled Optimus robot prototype at company’s AI day, a mass-market robot that could also be used in factory work 

+ Tesla asking all employees to help amid expecting “very high” delivery volumes at end of 3rd qtr 

- Meta to freeze hiring, undergo restructuring 

- Twitter set to restore Trump’s account: report 

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+ China’s official manufacturing PMI rises to 50.1 in Sept, returns to expansion 

+ China’s fiscal revenue in Aug recorded first YoY growth since March, totalled US$186bn, up by 5.6% 

- China’s industrial profits down 2.1% in first 8 mths 

+ China to roll out more policies and measures for manufacturing sector, aiming to increase foreign investment 

+ Xi verbally confirms APEC summit participation, Biden unlikely to attend 

+ China completed 40-day 

trail using central bank digital currencies to settle trades with HK, Thailand and UAE

- PBoC asked major state-owned banks to pe prepared to sell dollars for local unit in offshore markets for yuan defense: soruces

- China both offshore and on shore yuan tumbled to weakest levels in over a decade 

+ Yuan-rouble trading volume expected to overtake dollar-rouble in 2022

+ PBoC launched US$27.6bn credit to support business upgrades 

+ China has US$340bn of sovereign bonds to sell by year end 

+ China certifies C919 narrowbody passenger jet, first jet to be delivered by end-2022

+ China to cut provident fund loan interest rate for first-time home buyers 

+ China to relax floor on first home mortgage rates in some cities: central bank 

- China’s Sept new home sales prices fall for 3rd straight mth: private survey 

- China few developers qualify for new bond guaranteed programme: industry sources 

+ China begins construction 4th pipeline mega power transmission project to transports natural gas from western region to east 

+ China set to open world’s largest hybrid energy plant in 2023

- Chinese refineries ‘cautious’ over lifting export to Europe despite high demand: Global Times 

+ Chinese contractors produce >90% of Apple products, including estimated 98% of iPhones 

+ Nio gets into Lithium mining with US$7.8m stake in Australia’s Greenwing 

+ HKMA intervened in foreign-exchange market to defend HK Dollar’s peg against USD 

+ Taiwan to end Covid-19 quarantine for arrivals from Oct 13

+ China Airlines finalises deal on 24 Boeing 787 Dreamliners 

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- Japan ready to take FX action again if speculation persist: finance minister 

- Japan spent record of nearly US$20bn on intervention to support the yen 

- Japan’s economy still tilted to downside: BOJ

- Japan to pay major US chipmaker subsidy of up to US322m to produce advanced memory chips at Hiroshima factory 

+ Toyota output hits record high for Aug as parts crunch eses, to shut Russian factory due to supply chain problems

- Russia’s Nord Stream pipelines to Europe suffer mysterious leaks 

- Russia to investigate Nord Stream damage as int’l terrorism, said leaks occurred in zone controlled by US intelligence  

- Putin signed treaties to annex Luhansk, Donetsk, Kherson region and Zaporizhzhia region

+ Russia grain production expected to reach record 150m tons this year: Putin 

- Gazprom rejected to pay for gas transit fees to Ukraine

+ Russia’s top business lobby called for central bank to build up reserves of Chinese yuan in bid to stabilise rouble  

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- Eurozone inflation hits record 10%, ECB expected to hike rates in Oct meeting   

- Eurozone economic growth may drop to zero: ECB 

+ Euro area unemployment unchanged at 6.6% in Aug

- EU energy prices account for 50% of price increases 

- EU proposed fresh further restriction on trade with Russia 

- EU states can’t agree on Russian oil sanctions: Bloomberg 

+ EU announced launched of Baltic pipe 

+ EU may ease imports of Russian fertilizers, cement and other products: Politico 

+ EU to invest €28bn in clean energy tech by 2027

+ Germany to introduce electricity price cap if EU does not introduce its own: WSJ 

- German exporters sentiment fell in Sept to its lowest since early stages of Covid-19 

- German consumer sentiment set to plummet further to all time low in Oct: GfK

+ Germany to reverse long-planned shutdown of its nuclear power plants 

- Germany secured just one tanker of LNG from UAE: media 

- BoE stepped in after pound fell and FTSE tumbled, following intervention by IMF, urging UK to rethink tax-cutting plan 

- UK record 8m households in struggle to manage bills: Ofcom 

- UK food prices soared by record 10.6% this mth 

+ BoE bought £1.03bn worth of UK govt bonds in a reverse auction on September 28

- UK major mortgage lenders suspended new mortgage deals after govt unveiled new economic policies: FT  

- France schools and transport services disrupted by first major strike since Macron won re-elections in April 

+ Italy right-wing wins election

- Italy gas supply has been cut off by Russia 

- Turkey central bank will continue cutting interest rates, such action will lead to lower inflation: Erdogan 

- Turkey lira drops to new record-low against dollar 

+ Ukraine formally applying for fast-track membership of NATO military alliance

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- India’s central bank raises benchmark reop rate by 50 bps, 4th straight increase to tame high inflation 

- India enforcement body confirmed seizure order against Xiaomi froze US$682m, citing illegal remittances 

+ South Korea’s factory falls worse-than-expected 1.8% in Aug 

- South Korea’s exports grew at slowest pace in nearly 2 years in Sept

- South Korea asked 2 cryptocurrency exchanges to freeze US$65m worth of Bitcoin linked to Terra founder Do Kwon

+ South Korea removed Covid-19 PCR testing for inbound travellers from Oct 1

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+ Indonesia to reduce reliance on USD, plans to allow domestic transactions of NDFs in other currencies

+ Jokowi sees Q3 GDP growth at 5.4% to 6% 

+ Indonesia sovereign wealth fund draws S$20bn co-investment from funds including GIC and Abu Dhabi Investment

+ Indonesia authorised emergency use of China’s mRNA vaccine, the first known country to approve Chinese mRNA jab

- Bank of Thailand raises key interest by 0.25% to 1% to tame 14-year high inflation, keeps 2022 growth projection at 3.3% 

+ Thailand economy on recovery path in Aug on rebounding tourism and domestic demand 

- Malaysia parliament must be dissolved soon so that elections can be held this year: UNMO secretary-general

+ Malaysia PPI for local production eased to 6.8% in Aug vs 7.6% in July 

+ Malaysia aims to add US flights after air safety rating has been upgraded to Category 1 by US FAA

+ Malaysia considering lifting chicken export ban, expects to announce this mth 

+ Malaysian govt approved quota of 541,315 foreign workers as of 26 Sept

- Sg prices of imports and exports continued to fall in Aug, down by 1.7% MoM and 3.7% MoM respectively 

+ Sg population increases 3.4% to 5.64m after 2 years of decline 

- Sg tightens property curbs to cool HDB resale market, tighten loan quantum limits, lower loan-to-value limit 

+ Sg 4th in global digital competitiveness, tops in Asia: WCC

- Sg is 17 years behind HK as wealth hub: Bloomberg Intelligent

Contribution by Derek@valueinvestments chat group. Thank you.

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