MHMarkets:MHM Today News
☆ At 18:00, the EU will release its economic forecast report, and investors can pay attention to the EU's view on the future economy of the euro area.
☆ At 21:00, Federal Reserve Governor Bob Bowman will deliver a speech at the banking conference, and can pay attention to his expectations on the pace of interest rate increase of the Federal Reserve in the future. Earlier, Philadelphia Fed Chairman Huck said that a small increase in interest rates is a good strategy, and the Federal Reserve may cut interest rates in 2024.
MHMarkets
Market Overview
Review of Global Market Trend
Last Friday, because the possible candidate for the new governor of the Bank of Japan exceeded the market expectation, the spot gold rose to the high of 1872.07 US dollars, but gave up some gains before the US market, and finally closed up 0.18% to 1864.67 US dollars/ounce. Spot silver fluctuated back and forth at the US $22 level and ended up 0.08% at US $21.99/ounce.
The US dollar index was also affected by the news that the new governor of the Bank of Japan may be the Kazuo Ueda. At one time, the US dollar index fell below the 103 mark. However, due to Kazuo Ueda's pigeon in the subsequent interview, the US dollar index recovered all losses, and finally rose 0.36% to 103.59; The yield of 10-year US Treasuries rose sharply to 3.74%. The USD/JPY had a breathtaking V-shaped trend in the intraday, and once fell below the 130 level, and then recovered most of the lost land and rose above the 131 level.
In terms of crude oil, due to Russia's response to production reduction and OPEC+'s "no bottom line", both oil markets rose by more than 3%. WTI crude oil once rose to above $80, and finally closed up 2.73% at $79.74/barrel; Brent crude oil rose 2.67% to $86.43 per barrel.
The three major US stock indexes ended mixed, with the Dow Index up 0.5%, the Nasdaq Index down 0.61% and the S&P 500 Index up 0.22%. Most of the most popular technology stocks fell, while the most popular Chinese stocks fell, and the Nasdaq China Golden Dragon Index fell 3.66%.
European stocks fell across the board, with Germany's DAX30 index falling 1.39% to 15307.98; The FTSE 100 index fell 0.36% to 7882.45; The European Stoxx 50 Index closed 1.23% lower at 4197.94.
Market Focus
1. More than 33,000 people in Turkey and Syria were killed in the earthquake.
2. Former Cyprus Foreign Minister Hristozoulides is elected president.
3. At least 20 countries are waiting in line for a bailout package in front of the IMF as interest rates rise and the economy slows.
4. European parliamentarians: the U.S. is sabotaging the Nord Stream pipeline in order to block Russia's economic cooperation with Germany.
5. British politicians held a secret cross-party summit on the failure of Brexit.
6. Russia drafts bill to cap oil export discounts at $25-34.
Geopolitical Situation
Conflict Situation：
1. The Ukrainian side: Russian troops have begun a "major offensive" and are being forcefully repulsed by Ukrainian forces. The heaviest fighting is taking place in the cities of Vuldar and Malinka.
2. The Commander-in-Chief of the U.S. Armed Forces: in some areas of the front line succeeded in recapturing previously lost positions and captured a stronghold.
3. Retired lieutenant colonel of the "Lugansk People's Republic" Andrey Marochko said that Russian troops are successfully crossing the Ukrainian defense line near Crimina.
4. According to TASS: Ukrainian troops fired 10 rockets at Donetsk with multiple rocket launcher systems.
5. Russian Defense Ministry: Russian troops have destroyed 3,088 Ukrainian drones since the beginning of the special military operation.
Energy Situation：
1. U.S. oil producers' M&A deals pick up as cash is plentiful.
2. European parliamentarians: the U.S. is sabotaging the Nord Stream pipeline in order to block Russia's economic cooperation with Germany.
3. Russia drafted a bill to cap oil export discounts at $25-34.
Assistance Situation：
1. The Ukrainian army will receive Panther tank operation training in Germany next week.
2. Lithuania said that it had delivered the first batch of L-70 anti-aircraft guns to the Ukrainian military.
3. President of Poland: It is difficult to make a decision to provide F-16 fighters to Ukraine.
MHMarkets
Institutional Perspective
01
Goldman Sachs
It is long overdue for layoffs.
According to the Financial Times, Goldman Sachs CEO Solomon said that he should take action to reduce staff as soon as possible according to his intuition. Solomon said at a private meeting with about 400 Goldman Sachs partners in Miami that although there were adverse signs in the second quarter of last year, he was too slow in reducing staff. "If we take action earlier, the final layoffs may not be so fierce". Solomon also emphasized the potential strength of Goldman Sachs trading and investment banking in his speech to partners.
02
SOCIETE GENERALE
The EURUSD is bullish for a long time.
After the market interpreted the European Central Bank's interest rate decision in February as a dove, the rise of the EURUSD stopped abruptly. Economists from Faxing Bank pointed out that in the long run, the euro still points upward against the dollar. Technically, the possibility of further profit taking cannot be ruled out. The European Central Bank may try to correct the dove interpretation of the market's interest rate decision and statement in February, which may attract euro buying, but confidence may remain low until the U.S. CPI is released next week. Due to the improvement of its own terms of trade, the boost of China's economic growth, the narrowing of the policy interest margin of the Federal Reserve/European Central Bank and the attractive valuation, the long-term trend of EURUSD is still inclined to rise. The main downside risks are the new offensive launched by Russia against Ukraine, the further deterioration of relations between Russia and the West and the interruption of energy supply in Europe.
03
MUFG
The dollar has recovered most of its losses since the beginning of the year.
Mitsubishi UFJ Financial Group said in a report that the U.S. dollar continued to strengthen and reached its highest level against a basket of currencies in nearly four weeks after the release of the better-than-expected U.S. employment data last Friday, as the U.S. economy looked more resilient and there might be more interest rate hikes. Market participants have begun to price the possibility that the Federal Reserve will raise interest rates at least twice by 25 basis points before suspending the rate increase cycle. The U.S. interest rate market has lowered its expectation of starting to cut interest rates later this year, so the U.S. dollar has recovered most of the decline since the beginning of the year.
