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Breakfast Bites - Wed Jul 19, 2023

Rise and shine everyone.


The big news today is the inflation scorecard for the UK. Both Headline and

Core Inflation came in lower than expectations. Headline inflation dropped to 7.9% vs 8.7% the prior month. Core Inflation also dropped to 6.9% vs 7.1% the previous month. UK PPI numbers were also weaker. The FTSE-100 got a boost on this news and GBP took a hit.


US Equities are mixed this morning but largely flat, alongside Crude Oil. Gold has reversed lower while Bitcoin remains higher, with the US Dollar Index. The Yield Curve inverts further to -0.96%.


Important earnings today - Goldman Sachs and ASML before the open; Tesla and Netflix after the close.

  • ASML has already reported a double beat and raised guidance noting that they expect a later recovery. The stock is selling of slightly on the news.

  • Goldman Sach reports Q2 EPS $3.08 vs FactSet $3.16; increases dividend; Revenue $10.90B vs FactSet $10.61B; Provision for credit loss $615M vs consensus $567.4M


Asia and Australia

  • Asian equities ended with a positive tilt Wednesday. Hong Kong looked set for another sharply lower day before rallying in its afternoon session, mainland markets mixed. Seoul also rallied to the flat line, Taipei stayed in the red. Gains for Australia, Singapore and India, Southeast Asia mixed. Japan surged on weaker yen.

  • BOJ Governor Ueda told a news conference at the India G20 there was still some distance to sustainably and stably achieving the 2% inflation target, signaling his resolve to maintain ultra-loose monetary policy for the time being.

  • Chinese banks adopt 'wait and see' on repricing of existing housing mortgages lower.

  • New Zealand Q2 inflation came in at 1.1% q/q, ahead of consensus 0.9% but below prior quarter's 1.2%.

  • China's high-yield dollar bonds suffer worst slide YTD as defaults mount

  • Morgan Stanley moves 200 technology developers out of mainland China on data law


Europe, Middle East, Africa

  • European equity markets higher. FTSE 100 outperforms after slower UK inflation data, which sees UK housebuilders post biggest one-day gain since 2008.

  • June Eurozone CPI in at +5.5% y/y vs preliminary +5.5% and from 6.1% in May,

    • Monthly inflation printed at +0.3% vs preliminary +0.3%.

    • Core CPI came in at +5.5% y/y vs preliminary +5.4%.

    • Overall headline reading is at lowest level since January 2022, mainly due to a decline in energy prices.


  • The market has started to unwind aggressive UK rate hike bets after UK inflation surprised on the downside. Market now sees Bank Rate peaking below 6%, which compared with 6.25% prior to the data

  • EU plans €20B fund to stock Ukraine's military for years

The Americas

  • AT&T pushes back against lead covered cable concerns, says less than 10% of network exposed. Says it doesn't plan to replace its lead cables around Lake Tahoe as of now

  • AT&T and Verizon's dividends look safe amid questions about lead-wrapped cable liabilities

  • Johnson & Johnson sues Biden administration over Medicare's new powers to cut drug prices

  • Teamsters planning to strike at Yellow after trucking company fails to make $50M employee benefits payment

Calendars

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


Earnings


Economic



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