Global Financial and Political Developments: A Comprehensive Overview Part 1

Today's Key News

1

Morgan Stanley strategist Mike Wilson, in a Bloomberg TV interview, suggested that due to uncertainties surrounding the US presidential election, corporate earnings, and Federal Reserve policies, there is a possibility of a 10% stock market correction. He believes this is highly likely to occur between now and the election.

Analysis:

Impact on FX:Increased market uncertainty could weaken the USD.

FX Pair:EUR/USD, USD/JPY, GBP/USD

Impact on Shares:

US Stock Market:Potential negative impact on major indices.

Companies:General Market Indices

2

India's Tata Motors Ltd. and Mahindra & Mahindra Ltd. are closing in on Hyundai Motor Co.'s second-place market position in India, putting pressure on Hyundai's record $3.5 billion IPO in India.

Analysis:

Impact on FX:Increased competition could stabilize the INR.

FX Pair:USD/INR, EUR/INR, GBP/INR

Impact on Shares:

Indian Market:Potential positive impact on Tata Motors and Mahindra & Mahindra.

Companies:Tata Motors Ltd. (TTM), Mahindra & Mahindra Ltd. (M&M)

3

As Singapore intensifies its scrutiny of foreign funds, Hong Kong is implementing measures to re-attract wealthy Chinese clients. This year, Hong Kong expects to welcome about 200 high-net-worth individuals due to family office tax incentives and visa and residency programs. Last year, Hong Kong's asset management scale grew by 2.1% to HK$31 trillion, with strong performance in private banking and wealth management.

Analysis:

Impact on FX:Increased capital inflows could strengthen the HKD.

FX Pair:USD/HKD, EUR/HKD, GBP/HKD

Impact on Shares:

Hong Kong Market:Positive impact on financial sector stocks.

Companies:HSBC Holdings (0005.HK), AIA Group (1299.HK)

4

Hungarian Prime Minister Viktor Orbán's recent visits to Moscow and Beijing have surprised his Western allies, causing concern and dissatisfaction among EU and NATO partners who strive for a unified stance on Ukraine. Orbán met with Chinese President Xi Jinping on July 8 and previously with Russian President Vladimir Putin.

Analysis:

Impact on FX:Increased geopolitical tensions could strengthen the USD as a safe-haven currency.

FX Pair:EUR/USD, USD/JPY, GBP/USD

Impact on Shares:

European Market:Negative impact on market sentiment.

Companies:General Market Indices

5

Russian billionaires gained $11 billion in dividends during the economic boom of the Ukraine war. At least 12 businessmen received over 1 trillion rubles ($11.3 billion) in dividends from 2023 and the first quarter of this year, as companies adapted to sanctions and resumed or increased dividend payments.

Analysis:

Impact on FX:Increased wealth among Russian elites could stabilize the RUB.

FX Pair:USD/RUB, EUR/RUB, GBP/RUB

Impact on Shares:

Russian Market: Positive impact on dividend-paying companies.

Companies:Gazprom (GAZP.MM), Rosneft (ROSN.MM)

6

TSMC's market value briefly exceeded $1 trillion after Morgan Stanley and other brokerage firms raised their target prices. TSMC's American Depositary Receipts (ADR) rose 4.8% in New York on Monday, increasing its stock price by over 80% this year. Earlier in June, TSMC surpassed Berkshire Hathaway, becoming the world's eighth most valuable company.

Analysis:

Impact on FX:Positive corporate performance could strengthen the TWD.

FX Pair:USD/TWD, EUR/TWD, JPY/TWD

Impact on Shares:

Global Tech Market:Positive impact on semiconductor stocks.

Companies:TSMC (2330.TW), Berkshire Hathaway (BRK.A)

7

Despite efforts by Wall Street's most influential donors to persuade Joe Biden to end his re-election campaign, there is no clear path to achieving this goal. Biden insists he will continue to run and stated on MSNBC that he does not care about millionaires' opinions. Despite threats from wealthy donors to halt donations, Biden's campaign team reported a surge in grassroots donations following the debate, with June fundraising hitting a record high.

Analysis:

Impact on FX:Continued political uncertainty could weaken the USD.

FX Pair:EUR/USD, USD/JPY, GBP/USD

Impact on Shares:

US Stock Market:Potential negative impact due to increased political uncertainty.

Companies:General Market Indices