News / Analysis
Finance Update – Markets Oblivious to FlamesJune 8, 2020
Americas – Trump Extols Excellent NFP
In total oblivion to the mass protests and political impotence surrounding them, US markets just keep on spiralling higher, the DOW closing at 27338 after adding 3.15% during the session.
The week ended on a high note as the NFP came in at a positive 2.5 million new jobs added.
Leaving President Trump to say it had been a great week for the murdered victims.
Unemployment in Canada measured a slightly better-than-expected 13.7% in May, higher by 7/10 than the month before but not as bad as the 15% expected.
Asia – China Suffers Corona Trade
Japan’s Q1 GDP declined by another 0.6% – a tick worse than expected.
Asian indexes are beginning the week in the green, New Zealand’s Dow Jones staring with a 2.96% increase as the country is pronounced “clean of COVID”.
The Hang Seng trails with a 0.05% increase amidst the continuing Chinese clamp-down.
Sunday’s data shows China is now reaping the world’s lockdown in May, as exports contract and imports fall to a 4-year low – declining by 16.7% instead of 9.7%.
The nation’s trade surplus expanded to a record $62.93 bn. Imports of US soybeans remain well below expectations based on the Phase-1 trade deal – at a 16-year low, in fact.
Europe – HSBC Threatens UK
Meanwhile, half-way around the world, HSBC chairman Mark Tucker warned US officials that a UK ban on Huawei 5G technology could lead to Chinese reprisals against the bank.
HSBC, which began its life as a receptacle for opium war profits in the 19th Century, recently decided to express support for China’s security laws in Hong Kong.
Despite that, European indexes were upbeat as the week ended, Spain’s IBEX leading with a 4% rise with Switzerland’s SMI pulling up the rear at 1.14%.
Germany, after providing a €130 billion to its own economy, is now seeking ways to overrule its own constitutional court, which last month forbade the Bundesbank from joining an ECB bond purchasing program.
It will now seek explanations from the European Parliament rather than the European Central Bank. This morning’s data shows a doubled contraction in industrial production for April MoM to -17.9 – 2.5 points worse than expected.
Commodities – Oil soars on OPEC+
Oil received a double shot of energy as the week ended, with OPEC+ members rededicating themselves to production quotas until the end of July. Baker Hughes count receding once more, this time by 16 rigs to 202, despite prices now high enough to make a return to shale production feasible.
With China reportedly upping imports to an all-time record 11.3mBpD, the commodity is now attacking the $40 mark.
|06:00 AM GMT||Germany||Industrial Production|
|08:30 AM GMT||EU||Investor Confidence|
|12:15 PM GMT||Canada||Housing Starts `|
|11:01 PM GMT||UK||Like for Like Retail Sales|
|01:30 AM GMT (+1)||Australia||Business Confidence|
|05:45 AM GMT (+1)||Switzerland||Unemployment|