Wolf Money(world market review 22-28 July 2024)
Market Summary 22-28 Jul 2024
*USA*
+ US GDP grew at 2.8% pace in Q2, better than expected: advance estimate
+ US personal consumption expenditure price index edged up 0.1% MoM in Jun
+ US year-ahead inflation expectations fell for 2nd straight mth to 2.9% in Jul, lowest since Mar, from 3% in Jun
+ Joe Biden announced he will end his presidential re-election campaign
+ Fed seen on track for Sept rate cut after good inflation data
+ US PMI Composite Output Index, take both services and manufacturing business activity at 55 in Jul, at 27-mth high
+ US personal income rose 0.2% in Jun after advancing 0.4% in May
+ US Services Business Activity Index climbed from 55.3 in Jun to 56 in Jul
-US manufacturing PMI down 2.6 index pts to land at 49.5, lowest pt in 6 mths due to worsening business conditions within the goods-producing sector
-US new orders for manufactured durable goods down by 6.6% in Jun to reach US$264.5bn
-US goods trade deficit decreased to US$96.8bn in Jun, down 2.5% MoM: preliminary report
-US Consumer Sentiment Index fell 2.6% MoM to 66.4 and down 7.1% compared to the same mth in 2023
+ US personal spending up 0.3% MoM or US$58.6bn in Jun, matching expectations
+ US jobless claims declined by 10,000 to 235,000
-US existing home sales down 5.4% to 3.89m in Jun MoM
-US sales of new single-family houses down 0.6% in Jun to 617,000
+ US a heavyweight gp executives from US-China Business Council met with Chinese Vice-Premier n Foreign Minister in Beijing
+ California set targets for renewable energy adoption, requiring 90% all retail electricity sales from renewable sources by 2035, 100% by 2045
-OpenAI could lose as much as US$5bn this year; training costs, including paying for data could be as much as US$3bn
-Apple’s market share in China fell by 2% pts YoY landing at 6th position, share coming in at 14%: Canalys
+ Tesla expects to produce “several thousand” Optimus robots by end 2025
+ Alphabet to commit to a multi-year US$5bn investment in its self-driving vehicle unit Waymo LLC
-Wiz, cybersecurity startup rejected Alphabet’s US$23bn takeover offer, will instead pursue an IPO, its original plan
+ Boeing resumed delivery of 737 MAX aircraft to Chinese airlines
-Delta cancelled >6000 flights since the tech outage started, far more than other airline
+ GM China JV with SAIC NEV sales surged by 35.5% YoY in H1
-Berkshire Hathaway sold US$2.3bn Bank of America shares over 6 trading days
*GLOBE*
+ G20 agreed to work together to adopt a common tax for ultra-rich
-World facing weakest growth in decades: IMF
*CHINA*
+ China’s 3rd plenum signals the govt’s focus on greater fiscal flexibility, particularly in balancing revenue and expenditure between central and local administrations
+ China will formulate a law to combat cross-border corruption and improve its constitutional review system
+ China vowed to improve early warning systems to identify threats to its interests and investments overseas
+ PBoC to cut its 1-year medium-term lending facility (MLF) loan rate from 2.5% to 2.3%, also injected ¥235.1bn via its 7-day reverse repurchase program at interest rate of 1.7%
+ PBoC cutting its 1 and 5-year loan prime rate (LPR) by 10 basis pts, 1-year LPR currently at 3.35% and 5-yr rate at 3.85%
+ China’s 6 largest state-owned banks cut deposit rates for the first time since Dec, ranged from 5 to 20 bps for different terms
+ China’s central State-owned enterprises to invest >¥3 trillion for large-scale equipment upgrades over next 5 yrs
-China’s weak fundamentals of local govt financing vehicles are not being properly addressed: S&P Global Ratings
+ China increased subsidies for trading in old traditional fuel cars for new ones of US$41bn stimulus program to boost consumption
+ China connected total of 1180 GW of wind and solar power by end Jun, accounting for 38.4% of total power-generating capacity, tops coal for the first time
- China’s largest economic province Guangdong reported 3.9% growth in its GDP in H1, vs national average of 5%
+ China’s domestic tourism surged 14.3% YoY in H1
-Shanghai posted 9.4% slump in retail sale in Jun, worst monthly figure since 2-mth pandemic lockdown in spring 2022
+ China drives Asia’s venture capital market with 6 of the top quarterly deals: KPMG
+ China will buy >8000 commercial planes through 2043, accounting for 20% of global demand: Boeing
+ China unveiled action plan on green development of data centres, specifying targets to accelerate low-carbon transition
+ Chinese smartphone vendors filled out entire top-5 list for the first time in Q2, knocking Apple to no. 6
+ Foxconn to invest ¥1bn to build a new HQ in China to make EVs and batteries
*EUROPE*
-Eurozone PMI Composite Output Index expected to come in at 50.1 in Jul, reaching 5-mth low
-European Commission: 10% of €1.5bn frozen Russian assets to Ukraine, 90% to EU fund
-EU reportedly extend sanctions on Russia central bank indefinitely
-EU to issue its first antitrust charges against Meta Platforms
+ Germany’s cabinet agreed to increase tax relief for companies and households to almost €21bn per year to boost economy
-Germany’s HCOB Flash composite manufacturing PMI index fell to 48.7 in Jul, lowest in 4 mths: HIS Markit’s preliminary report
-Mercedes-Benz’s Q2 revenue at €36.7bn, down 3.9% on annual basis
-UK new Chancellor to unveil a £20bn spending deficit left by previous govt
+ UK private sector reported its strongest growth in 15 mths, manufacturing PMI at 51.8, highest in 2 yrs
-UK number of bankruptcy declarations in England and Wales reached highest level in over a year in Jun
-LVMH’s H1 revenue down 1% to €41.7bn
-Russian central hikes interest rate to 18% from 16%, citing inflationary pressures
+ Russian to ramp up energy supplies to China
*ASIA*
+ Asia surpassed Europe as largest export market for Chinese solar products in H1
+ Japan’s activity in service sector output expanded in Jul to 53.9 vs 49.4 in Jun: S&P Global preliminary report
-Nippon Steel to end 20-year JV with China’s Baoshan
+ Toyota to open new plant in Kyushu, known as Japan’s Silicon Island, to build batteries for EV
+ India’s business growth at its fastest pace in 3 mths in Jul, companies hired at fastest pace in >18 yrs
-South Korea GDP fell 0.2% in Q2 MoM; slumping consumer spending undermined export boom, sharpest contraction since 2022
+ SK Hynix, Nvidia’s supplier, to build US$6.8bn chip plant in South Korea
*ASEAN*
+ Indonesia govt received proposal to establish 7 new special economic zones (SEZ), including 1 near new capital Nusantara
+ Indonesia launched 2nd phase industrial complex in Central Java to attract investors looking to diversify supply chains away from China
+ Bali expected to begin construction of underground tunnels and tracks for LRT system in Sept
+ Malaysia committed to reducing debt-to-GDP ratio to 60% within 5 yrs from current 64%
+ Malaysia ranks among top 3 trade partners in China’s BRI, with trade surpassing US$100bn in H1
-Malaysia to review anti-dumping laws as cheap China goods hurting local businesses
+ Melaka proposed Southern Gateway Economic Corridor involving Melaka, Negeri Sembilan and Johor
+ Malaysia has applied to join BRICS: Anwar
-Sg factory output down 3.9% in Jun, dragged down by electronics, biomedical sectors
+ MAS leaves monetary policy setting unchanged, expects full-year GDP at 2-3%
+ Sg Jun’s headline inflation at 2.4% vs 3.1% in May
+ Sg office rents in central region rose 3.1% in Q2 vs 1.7% declined in Q1
+ HDB resale price growth up 2.3% in Q2 on robust demand and tight supply
+ Chiang Airport’s Q2 passenger movements hit 98.2% or 16.5m of pre-pandemic level
-Grab’s acquisition of Trans-cab fell through as both parties withdrew
Contribution by Derek@valueinvestments chat group. Thank you.
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