Mohicans markets ：MHM Today News

☆ At 11:30, Australia to March 7 Australian Fed interest rate decision, followed by a speech by Australian Fed President Lowe the following day at 5:55 a.m. Institutional analysis indicates that the Australian Fed will almost certainly end with its 10th consecutive increase in the official cash rate, raising it from 3.35% to 3.60%. However, guidance comments are likely to moderate, leaving many to expect the cash rate to peak at 3.85% in April. This will drive an adjustment in the market, which currently expects the terminal rate to be well over 4.0%.

☆ At 23:00, Fed Chairman Jerome Powell delivers his semi-annual monetary policy testimony before the Senate Finance Committee. This is Powell's first speech since he spoke at the Economic Club of Washington on Feb. 7, and may also be his last public speech before the March rate meeting, so it is of great interest.

☆ The 14th National People's Congress will hold a press conference this morning, inviting Foreign Minister Qin Gang to attend and answer questions from Chinese and foreign journalists.

☆ The following day at 1:00 am, EIA will release its monthly short-term energy outlook report.

☆ The following day at 5:30 a.m., the U.S. API crude oil inventories for the week to March 3 will be released, with an expected increase of 6.203 million barrels.

Market Overview

Review of Global Market Trend

On Monday, as risk factors such as Powell's speech and Non-farm payrolls data loomed, spot gold retreated from the two-and-a-half-week high it touched earlier, hitting an intraday low of 1845.01 and finally closing down 0.28% at $1847.2 per ounce. Spot silver once fell back below $21 per ounce, then rebounded slightly and finally closed down 0.65% at $21.05 per ounce.

The U.S. dollar index oscillated lower, eventually closing down 0.249% at 104.29. The U.S. 10-year Treasury yield made a V-shaped reversal, pulling up in U.S. trading to recover intraday losses, eventually closing up 0.02% at 3.964%. In addition, a major global benchmark lending rate - the 3-month U.S. dollar Libor broke through 5% for the first time since 2007.

Crude oil fell before rising, with WTI crude standing at $80 per barrel for the first time since Feb. 13, eventually closing up 1.41% at $80.4 per barrel; Brent crude rose above $86 per barrel for the first time since Feb. 16, eventually closing up 0.89% at $86.45 per barrel.

In other international futures, U.S. natural gas futures prices plunged about 15%, which was the biggest one-day drop in more than eight months, on forecasts for cold weather and much weaker-than-expected heating demand over the next two weeks. Wheat prices fell below $7 per bushel as the Ukraine grain deal is expected to be extended.

U.S. stocks retreated in late trading, with the Dow closing slightly up about 40 points, the Nasdaq closing down 0.11% and the S&P 500 closing up 0.07%. The Nasdaq China Golden Dragon Index closed down about 1.7%. Most popular Chinese stocks closed lower, with Bilbili closing down about 4% and Xiaopeng Auto and Baidu closing down about 2%.

Major European stock indices were mixed. Germany's DAX30 index closed up 0.48% at 15,653.58 points; Britain's FTSE 100 index closed down 0.22% at 7,929.79 points; Europe's Stoxx 50 index closed up 0.44% at 4,313.78 points.         

Market Focus

1. According to the plan of CME to launch offshore RMB options in April.

2. The Federal Reserve of New York: The global supply chain pressure fell sharply in February, and is now below the historical average.

3. According to the data of the Moscow Exchange, in February, the RMB became the largest foreign currency in Russia for the first time.

4. Influenced by the expected interest rate increase of the Federal Reserve, the three-month dollar Libor has exceeded 5% for the first time since 2007.

5. The price of wheat fell below $7/bushel because the Ukrainian food agreement is expected to be extended. The weather forecast is relatively mild, with US natural gas prices plummeting by 15%.

6. European Central Bank Regulatory Commission Holtzmann: It is expected that there will be four more 50 basis points interest rate increases.

7. There will be another winter storm in the northern plains and several areas in the northeast of the United States this week.

Geopolitical Situation 

Conflict situation:

1. On March 6 local time, the air defense warning was sounded throughout Ukraine.

2. Austin, Secretary of Defense of the United States: The symbolic value of Bachmut is greater than the strategic or operational value. Even the fall of Bachmut does not mean that the situation in Russia's broader military operations will be changed.

3. Ministry of Defense of Russia: The peacekeeping force continuously monitors the situation on the ground and monitors the implementation of the ceasefire system at 30 observation stations in the Nagorno-Karabakh (Nagorny Karabakh) region 24 hours a day.

4. Russian Ministry of Defense: In the past day, Ukraine lost 225 soldiers in the direction of Donetsk.

5. The Ministry of Defense of Russia: The Russian military attacked the Ukrainian military personnel and weapons and equipment in Kupiyansk, Zinchman, Donetsk and other directions.

6. Ukrainian media: The Ukrainian Supreme Command held a meeting on the 6th. The Ukrainian military agreed to continue to defend in Bakmut and further strengthen the position in this area.

Energy situation:

1. German Economy Minister Habak: It should be possible to fill up the natural gas reserves in the summer without driving up the price surge.

2. CEO of Chevron: I don't see any intention to reuse Russian natural gas in Europe.

3. According to ship tracking data and trade information, sanctions led to the flow of Russian crude oil to the United Arab Emirates.

4. Chief Executive Officer of Gunvor Group, an oil dealer, said that the price ceiling and export ban did not interrupt Russia's oil transmission, and the products seemed to find a way to enter the market. Its oil exports have remained more or less unchanged, and the volume of product shipments may be greater than before the outbreak of the Russian Ukrainian conflict. There are 300-400 “ghost fleets” transporting Russian oil.

5. Ministry of Energy of Ukraine: The heating season is coming to an end and energy reserves are recovering.

6. US energy envoy: Russia's oil price ceiling is operating well, and Russian oil continues to flow and is sold at a discount price.

Food situation:

1. Ukrainian Academy of Agricultural Sciences: Most of Ukraine's winter food crops are in “relatively good condition” at present.

2. The price of wheat fell below $7/bushel because the Ukrainian food agreement is expected to be extended.

Institutional perspective

01

Goldman Sachs

For the first time in nearly six years, Goldman Sachs Group proposed to buy Apple shares. Earlier, Apple's (AAPL. O) share price has more than tripled, while Goldman Sachs has basically been on the sidelines. Analyst Michael Ng has just taken over the analysis of Apple's stock. He said that Apple's huge user base would help it develop its service business.“Apple's success in high-end hardware design and the resulting brand loyalty have led to the continuous growth of user base,” Ng said. According to the data, he is the third Goldman Sachs analyst responsible for tracking Apple's stock in six years. He wrote in the report that this would help the company reduce the number of users leaving the ecosystem, reduce the cost of customer acquisition, and encourage customers to repeat purchases. Rod Hall, has tracked Apple's stock for nearly five years, and previously gave it a neutral or sell rating. Apple has risen by more than 300% since Goldman Sachs last gave the same buy rating in 2017. Goldman Sachs did not immediately respond to requests for comment on rating history. Goldman Sachs gave Apple a new target price of $199, 32% higher than the recent closing price.

02

SOCIETE GENERALE

[SOCIETE GENERALE looks forward to the RBA's interest rate decision]

On March 6, SOCIETE GENERALE believed that the recent macroeconomic data of Australia showed signs, such as lower inflation, rebound in unemployment rate, relatively tepid wage growth and slower consumption, all supported the Federal Reserve of Australia to raise interest rates by 25 basis points in March. SOCIETE GENERALE also said that although the financial market had a more hawkish expectation of the Federal Reserve's policy, investors also supported the Bank's expectation that the terminal interest rate of the Federal Reserve of Australia would be 3.85%.

03

MUFG

MUFJ: Limited upside space for USD/JPY

The Bank of Japan will hold an interest rate resolution meeting on Friday and is expected to maintain the policy unchanged. Economists at MUFJ Financial Group predicted that the dollar would struggle to rise against the yen. There is still a risk of exceeding expectations on Friday, although we tend to think that the task of adjusting the yield curve control (YCC) policy will be handed over to the next president. The Japanese parliament may also confirm the nomination of the new leadership of the Bank of Japan on Friday. Of course, there are also US non-agricultural employment data on Friday. If the interest rate decision of the Bank of Japan is as expected, the trend of USD/JPY will continue to be guided by the yield of US bonds, so the US non-agricultural employment data will be the key. However, the market's speculation on YCC is unlikely to subside. In view of the imbalance in the Japanese treasury bond bond market, we believe that there is sufficient reason to end YCC at the policy meeting on June 16. In this case, we believe that the upward space of the USD/JPY is limited, especially considering the soaring US bond yield in February, the upward space will become more limited.