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Breakfast Bites - Mon Jul 17, 2023

Rise and shine everyone.

Happy Monday!

It’s a quiet day for US Economic Data with only the Empire State Manufacturing data being released at 8:30am ET. The Fed has gone into their quiet period before the next FOMC meeting on Jul 25-26 so we get a bit of a break from Fed speakers.

Earnings are quiet today as well with a few regional banks reporting. Check out our free earnings preview for the week, if you haven’t already.

US Equity Futures are muted this morning after marginally lower close on Friday. Crude Oil spiked this morning with WTI hitting $76 after Saudi Arabia announced extending their voluntary cuts until Dec 2024. The move has since been faded. Gold is marginally higher while the US Dolllar and Bitcoin are lower. The Yield Curve has inverted further again to -0.94%.

Asia and Australia

  • Asian equities ended mostly lower Monday in a cautious day's trading. Losses in mainland China and South Korea, modest gains for Taipei, India and most of Southeast Asia; Australia and Singapore flat. Japan closed for a holiday, Hong Kong closed on a typhoon warning.

  • China’s GDP data comes in mixed but, not altogether encouraging. Q2 GDP expanded 6.3% y/y, below consensus 7.3% and follows 4.5% in the previous quarter. However, sequential growth came in at 0.8% q/q, firmer than consensus 0.5%, following 2.2% in Q1.

  • China’s PBOC injected CNY103B in new MLF funding while keeping the rate unchanged at 2.65%, both matching expectations.

  • China property investment fell 7.9% y/y in Jan-Jun, versus Bloomberg forecast of 7.5% drop

  • Singapore's non-oil exports (NODX) fell 15.5% y/y, ninth consecutive contraction

Europe, Middle East, Africa

  • European equity markets lower. France's CAC underperforms amid weakness in luxury goods sector. Basic Resources and Tech also among the worst performing sectors.

  • Poll of economists show ECB to bring rates to 4% peak in September

  • Property website Rightmove said the price of UK property coming to the market fell for the second month in July, with prices down 0.2% m/m

  • Russia announced Monday it had ended participation in the UN-brokered grain deal, which had allowed Ukraine to export grain through the Black Sea after Moscow blamed Kyiv for an attack on the Crimean Bridge. Pact will end with immediate effect.

The Americas

  • Net Interest Margin pressure seen in State Street's Q2 results may be better bellwether for industry than money center names

  • Yellen says 'premature' to scrap Trump tariffs, but US should look for ways to further de-escalate tensions with China

  • Musk says Twitter's ad revenue down 50%, company still cash flow negative

  • BlackRock expects surge in bond fund investments (funded by money-market fund outflows) after Fed stops raising rates

  • Investors using 50% rally in ARK Innovation ETF this year to get out

  • Repayment of student loan debt could feel like pay cut of ~4-5%, have outsized impact on apparel and T&E spending

  • Americans increasingly tapping HELOCs to take advantage of equity ramp from higher prices


(news taken from Reuters, FT, Bloomberg; Calendar from Benzinga Pro)


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