Mai hui MHmarkets: July 31, 2023 - Fundamental Reminder

☆09:30 CNY NBS Manufacturing PMI (JUL)

☆15:00 CNY State Council Information Office Press Conference

The press conference introduces information about measures to restore and expand consumption.

☆17:00 EUR Inflation Rate (JUL)

The market expects it to rise 5.3% year-on-year, slowing down from the previous 5.5%, the YoY growth rate slowed to -0.1%.

☆21:45 USD Chicago PMI (JUL)

☆22:30 USD Dallas Fed Business Activity Index (JUL)

Market Overview

Review of Global Market Trend

Last Friday, the U.S. dollar index European test 102 mark unsuccessful, and then gave back most of the day's gains, but the end of the day to recover some of the lost ground, and finally closed up 0.01% at 101.7. U.S. bond yields continue to be affected by the impact of the cooling of inflation sharply downward, the two-year U.S. bond yields fell below 4.9% to close at 4.881%; 10-year U.S. bond yields fell below the 4% mark to close at 3.955%.

Spot gold was boosted by lower U.S. bond yields, rose to a high of $1963.60 during the day, and ultimately closed up 0.7% at $1959.35 per ounce; spot silver stood steady above $24, and ultimately closed up 0.83% at $24.33 per ounce.

Crude oil continued to climb on Friday, and for the fifth consecutive week of gains. WTI crude oil broke the $80 mark, and eventually closed up 1.08% at $80.63 per barrel; Brent crude oil was close to $85 during the session, and eventually closed up 1.3% at $84.40 per barrel.

The three major U.S. stock indexes opened high, the Dow rose 0.5%, the Nasdaq rose 1.9%, the S&P 500 index rose 0.99%. The Nasdaq China Gold Dragon Index rose nearly 7%, popular Chinese stocks were higher, Xiaopeng Automobile, Bilbili rose more than 15%, iQIYI rose more than 13%, Azure Automobile rose more than 11%, Ideal Automobile rose more than 9%, Futura Holdings rose nearly 8%. U.S. bank bulls and bears indicator rose from 3.8 to 4.0, the highest level since the U.S. regional banking turmoil.

Major European stock indexes closed mostly higher, with Germany's DAX 30 closing up 0.39%, Britain's FTSE 100 up 0.02% and Europe's Stoxx 50 up 0.43%.

Market Focus

1. TASS: Russia's Moscow airspace is temporarily off limits.

2. Putin: Russian requirements should be fulfilled first, then Russia will return to the agreement on the export of agricultural products from Black Sea ports.

3. India launches PSLV-C56 carrier rocket with 7 satellites.

4. Russia extends rice export ban until the end of this year.

Geopolitical Situation

Conflict Situation

1. TASS: Russian airspace in Moscow is temporarily closed.

2. Moscow Mayor: Ukrainian drones hit Moscow early in the morning. Two were shot down.

3. Russian Defense Ministry: Ukraine launched an attack on facilities in Crimea with 25 drones in the early morning of the 30th. Sixteen drones were shot down by air defense systems, and nine crashed in the Black Sea waters after electronic warfare systems interfered. The Russians repelling three Ukrainian attacks in the direction of Dijman, killing about 140 Ukrainian troops, two armored vehicles, three cars and a D-30 howitzer-in one day.

4.22 people have been injured by falling missile debris in the Russian city of Taganrog in Rostov Oblast, according to local health authorities.

Institutional Perspective

01

Goldman Sachs

Goldman Sachs: Global oil demand hit a record in July and is expected to shift the global oil market from surplus to deficit on the back of OPEC+ production cuts and record oil consumption.

02

SOCIETE GENERALE

SOCIETE GENERALE: The ECB is expected to raise interest rates by 25 basis points, and while it may be too early to provide firm guidance for a further hike in September, the ECB is expected to raise rates one last time in September as upside risks to inflation remain.

03

MUFG

【MUFG：BOJ takes stealth action and waits to see what happens】

July 28 - By raising the ceiling for its fixed-rate operations to 1%, the BOJ effectively widened the target range for the 10-year government bond yield, making it easier for the central bank to steer the yield target flexibly, said MUFG senior market economist Naomi Muguruma. In this sense, the central bank acted stealthily. The BOJ will likely wait to see how these measures prove effective for the time being. The BOJ will not determine the strength of wage growth and price trends until at least next spring's labor offensive gives clues on wages.