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Breakfast Bites - Fri Sep 8, 2023

Rise and shine everyone and Happy Friday.

It’s a light day for US Economic data but, we did get final German Inflation numbers that came out in line with expectations.

Japan’s QoQ GDP numbers were revised downward from 1.5% to 1.2%. There was also some discussion of intervention for the currency weakness in the Japanese Yen. The Japanese market is lower on today after this.

US Equity Futures lower this morning. US Dollar Index maintaining its strength but remains flat. Yield higher at the long end with the yield curve steepening to -0.69%. US WTI had pulled back overnight but gained traction early morning at $87.50. Gold higher while, Bitcoin is lower.

Asia and Australia

  • Asian equities ended lower Friday on disappointing Japan GDP data and as US-China technology tensions increased. Mainland China markets fell again but had pared much of their losses by the close, Hong Kong closed due to adverse weather. More losses for Australia to close a poor week

  • Offshore yuan hit 7.36 per dollar level on Friday morning, beyond psychologically important 7.35 level and close to weakest since inception of offshore market in 2010.

  • Alibaba looks to regain momentum with management shakeup

  • Itochu is to invest in battery farms to store energy from renewable sources along with privately owned, Australia based Akaysha Energy.

Europe, Middle East, Africa

  • European equity markets lower after failing to sustain early gains. Cyclicals leading weakness in Europe amid focus on growth outlook.

  • Ahead of next week's ECB policy decision, economists divided on pause or hike. Inflation reports have been mixed since June. Economies like Germany and the Netherlands already fell into a recession, with Italy at risk, and most others have either barely grown or contracted.

  • UK: A survey by KPMG and REC showed hiring is falling at the fastest pace in more than three years.

  • European gas prices jump as Chevron fails to avert stikes at LNG plant.

  • Euro heads for eight-week losing streak as economy falters

  • Citigroup cuts 2023 euro area real GDP growth forecast to 0.4%

The Americas

  • Walmart cuts starting pay for new hires - it would seem that the labor market is finally easing. Companies no longer have to go above and beyond to attract talent.

  • Goldman Sachs preparing for another round of job cuts aimed at underperforming employees.

  • Restoration Hardware reports Q2 EPS $3.93 ex-items vs FactSet $2.65. Revenue $800.5M, including $25M revenue benefit from faster than expected deliveries and a shift of ~$40M of advertising costs from Q2 to Q3, vs FactSet $790.7M

  • Commerce Department launches fresh probe into Huawei following release of new smartphone

  • Kroger will pay up to $1.2 billion to settle most nationwide opioid claims

  • General Motors on Thursday proposed a new contract for employees represented by the United Auto Workers that would offer 10% wage increases for the majority of workers. Newer employees would be eligible for up to a 56% wage increase over the four years of the deal. The contract would be the largest four-year wage increase in decades. However, UAW President Shawn Fain said the offer was “insulting.”


(news taken from Reuters, FT, Bloomberg; Calendar from Trading Economics)


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