MHMarkets：September 04, 2023 - Fundamental Reminder

☆ 21:30 ECB President Lagarde Speaks

☆ American stock market closes on this Monday

Market Overview

Review of Global Market Trend

Friday's non-farm report was in line with a “soft landing” trend, but the dollar index quickly rebounded from the day's low to close up 0.64% at 104.28 as Cleveland Fed President Loretta Mester “hawked” again, hinting at continued tightening.

Treasury yields briefly hit a three-week low after the report, but later recovered. The yield on the 10-year Treasury rose to 4.18% from 4.11%; Two-year yields rose less than 2 basis points on the day.

Spot gold briefly broke the $1,950 mark after the non-farm announcement, before falling sharply as Mestre threw cold water on it, falling nearly $20 to settle down 0.02% at $1,939.9 an ounce. Spot silver fell for three straight sessions to close down 1.05%.

Crude oil closed up four consecutive trading day, WTI crude oil closed up 2.92%, to $85.98 a barrel, record since November last year; Brent crude settled up 2.36% at $88.78 a barrel, its highest level since January.

The three major U.S. stock indexes were mixed. The Dow Jones closed up 0.33%, the s&p 500 index closed up 0.15%, nasdaq closed down 0.02%. The Nasdaq China Golden Dragon Index rose more than 3%. Intel gained 4%, cryptocurrency exchange Coinbase fell 2%, Xpeng Motors rose 5% and Beike gained 7%.

Major European stock indexes continued to diverge, with Germany's DAX30 closing down 0.67%, Britain's FTSE 100 up 0.34% and the Euro Stoxx 50 down 0.36%.

Market Focus

1. American stock market closes on this Monday.

2. Thailand is considering exempting visas for Chinese tourists.

3. The president of Nigeria has announced a global recall of its diplomatic missions.

4. The President of Ukraine has decided to dismiss Reznikov as Defence Minister.

5. Iran's foreign minister says the parties to the nuclear deal have received the latest plan for negotiations.

6. Warner Brothers: the movie Barbiereached $1.38 billion at the box office worldwide, to become the highest-grossing film in 2023.   

Geopolitical Situation

Conflict Situation

1. Ukraine's air force says it shot down 22 drones in the Odessa region.

2. Russian Defense Ministry: In the early morning of September 3, Russian drones launched a concentrated strike, destroying the Ukrainian army's fuel depot in Odessa prefecture.

3. Russia's Defense Ministry says it shot down a Ukrainian drone in Russia's Kursk region.

4. General Tanavsky, commander of Ukraine's operational and strategic forces on the southern Front, said Ukrainian forces were expected to make faster progress by breaking through the first Russian line of defense near Zaporizhzhia and pressing the weaker second line.

5. Russia's deputy ambassador Yang said, polly direct confrontation between Russia and NATO huge risk.

6. Russia's defense ministry Wednesday situation, said Russian troops before him, and dividends, donetsk direction on Ukrainian military personnel and vehicles, howitzers, and other military equipment.

7. The General Staff of the Ukrainian armed forces released a war report on Wednesday, saying that in the past 24 hours, the Ukrainian army and the Russian army have engaged in 25 battles on the front line. Many parts of Ukraine have been hit by Russian shells and missiles. Ukraine's air force, missiles and artillery to Russian personnel and equipment, high, objectives etc. Russian artillery strike.

Institutional Perspective

01

Goldman Sachs

Candice Tse, global head of strategic advisory solutions at Goldman Sachs: As the overall economy moves toward a soft landing, the job market continues to show signs of moderation, reinforcing market expectations that the Fed will keep interest rates steady at its September meeting. With continuous strong U.S. economic data and the federal reserve to provide more specific guidance for future policy path, investors may find for excess returns in equity and fixed income opportunities.

02

SOCIETE GENERALE

SOCIETE GENERALE：Inflation remains high, and the ECB may raise interest rates faster than expected

Sep 1 - The ECB is likely to focus on its price stability mandate at its meeting on Sept. 14, meaning a higher rate hike could be more likely than markets currently expect, Societe Generale rates strategists said in a note. “Given data dependency and uncertainty, it may be difficult for markets to fully anticipate a rate hike,” they said, noting that the outcome of the meeting remains uncertain. “However, the ECB should be pragmatic and focus on its price stability mandate, which remains at risk due to elevated measures of underlying inflation, falling real interest rates and inflation risks skewed to the upside.”

03

MUFG

【MUFG：The dollar may weaken on shutdown fears】

The dollar could weaken at the end of September if speculation that the U.S. government could shut down again in October is confirmed, MUFJ research director Derek Halpenny said in a note. The lack of precise details on government funding in the US has raised concerns about a potential government shutdown as the new fiscal year approaches on October 1. He said: “seek spending cuts the republicans are likely to have more influence, which may make the government into the lockout period in October.” The longest shutdown of 2018 had a negative impact on the dollar