June 12, 2023 - Fundamental Reminder
☆ There are no data or events to focus on today.
Market Overview
Review of Global Market Trend
Last Friday, the market is waiting for the arrival of the Federal Reserve interest rate resolution, the dollar index rebounded slightly, closing up 0.23% at 103.3. Previously due to the cooling signal of the job market and the decline in U.S. bond yields, on Friday also appeared a slight recovery. Two-year U.S. bond yields once back up about 10 basis points to close near 4.6%; 10-year U.S. bond yields rose less, which was from 3.72% to 3.74% during the day.
Spot gold failed to hold previous gains, under pressure to the downside on Friday, once lost the $1960 mark during the day, closing down 0.24% at $1960.74 per ounce; spot silver rose for 2 consecutive days, once up to $24.52 per ounce during the day, closing back most of the gains, but it still closed up 0.06% at $24.28 per ounce.
Crude oil extended the previous session's decline, the U.S. and cloth oil once fell nearly 2% during the day; although then recovered some of the lost ground, but WTI crude oil still closed down 0.86% at $70.29 per barrel, Brent crude oil closed down 0.73% at $74.96 per barrel. Last week, WTI crude oil fell by more than 2%, Brent crude oil fell by 1.61%, closing down for 2 consecutive weeks after 2 consecutive weeks of gains together with WTI crude oil; WTI crude oil has completely erased the previous 2 weeks of gains.
The three major U.S. stock indexes closed slightly higher, with the Dow closing up 0.13%, the S&P 500 closing up 0.17% and the Nasdaq closing up 0.16%. Tesla closed up 4.06%, which was the 11th consecutive trading day of gains. On the news, General Motors said it will adopt the Tesla interface, promoting Tesla into the North American charging standard. The charging pile sector was down in general, with Chargepoint down more than 13%, EVgo down 12.36% and Blink Charging down more than 10%. The Nasdaq China Golden Dragon Index closed slightly higher by 0.26%.
European stocks fell across the board, Germany's DAX30 index closed down 0.25%; Britain's FTSE 100 index closed down 0.50%; France's CAC40 index closed down 0.12%; Europe's Stoxx 50 index closed down 0.18%; Spain's IBEX35 index closed down 0.31%; Italy's FTSE MIB index closed down 0.39%.
Market Focus
1. Trump said he would not withdraw from the election even if convicted and would not be convicted of any of the federal charges brought against him in the classified documents case.
2. Saudi energy minister: will cooperate with China to build more crude oil chemical plants, China will participate in more Chinese oil business.
3. British media: the United States may unload oil from the Iranian tanker seized previously in April.
4. Party split, two more British Conservative Party members of the House of Commons announced their resignation after former Prime Minister Johnson announced his MP post on the 9th. Six other Conservative MPs are now reportedly ready to resign.
5. Iran's Supreme Leader Khamenei: Nothing wrong with a nuclear deal with the West on the basis of not destroying the nuclear infrastructure.
Geopolitical Situation
Conflict Situation
1. Russian Defense Ministry: Russia shot down a Ukrainian SU-25 fighter jet in the Kherson region.
2. Russian Defense Ministry: Ukraine tried to attack Russia's Black Sea fleet, but failed.
3. Russian Defense Ministry: Ukrainian armed forces have been carrying out failed offensive attempts in the past 24 hours in the direction of Southern Donetsk, Zaporizhzhia and Donetsk. In one day, the Ukrainian armed forces lost more than 50 Ukrainian soldiers, 11 tanks, including three Leopard tanks, 17 infantry fighting vehicles, 16 armored fighting vehicles, four vehicles, a British-made Storm air defense missile system fighting vehicle, and a US-made M777 artillery system in these directions.
4. Russian media: Russian air defense systems have shot down an aerial missile in the Zaporizhzhia region.
5. Foreign media: Ukraine says its forces have recaptured three towns in the southeast from Russian forces. Ukrainian forces continued offensive operations and advanced 250 meters in the Bakhmut region and about 300 to 1,500 meters on two fronts in the southern part of the Donetsk region, the deputy defense minister said.
6. The Russian Defense Ministry said Russian forces repelling multiple Ukrainian attacks in the Zaporizhzhai and Donetsk regions, hitting Ukrainian command posts in the Zaporizhzhai region and weapons and ammunition depots in the Donetsk region.
Situation of the Kakhovka Dam
1. The Russian Foreign Ministry spokesman accused the Ukrainian army of planning to attack the Kahovka hydropower station for a long time.
2. Ukraine's hydropower company said the water level in the Kakhovka reservoir dropped by seven meters.
3. Nearly 7,000 people have been evacuated in Kherson region due to the dam failure of the Kahovka hydropower station.
4. Flood levels have fallen below 7 metres in the area of the city of New Kakhovka and below 1.5 metres in the area of the city of Alyoshka.
5. Ukrainian media: The salinity of the Black Sea has dropped sharply following the accident at the Kakhovka hydroelectric dam.
Institutional Perspective
01
Goldman Sachs
【Goldman Sachs has lowered its expectations for December US crude oil and Brent crude oil prices three times in the past six months.】
On June 12, Goldman Sachs, one of the most bullish investment banks on the oil price outlook, once again lowered its oil price forecast for the United States and Bangladesh amid increasing global supply and weakening demand. The bank cut its December Brent price forecast to $86 a barrel, down from its previous forecast of $95 a barrel, and cut its WTI forecast to $81 a barrel from $89. This is the third time in the past six months that Goldman has cut its forecast, having previously stuck to its $100-a-barrel forecast. On Friday, August Brent crude settled at $74.79 a barrel. "They've never been so wrong for so long," said Jeff Currie, head of commodities research at Goldman Sachs. Goldman Sachs cited increased supply from countries facing sanctions, namely Russia, Iran and Venezuela, as key drivers of the lower price outlook.
02
SOCIETE GENERALE
【Societe General: 10-year US-Germany bond spreads expected to narrow】
On June 2, Socgen interest rate strategists wrote in a note that there is room for the yield spread between 10-year US Treasuries and German Bunds to narrow, in line with the usual trend around the last Fed rate hike. "Core inflation is not yet in free fall, while the ECB's stance is less restrictive than the Fed's," they said. "This is good for narrowing spreads between Treasurys vs. The spread between yields on 10-year U.S. Treasurys and 10-year German bunds currently stands at 135 basis points, according to Tradeweb, with the 10-year Treasury yielding around 3.62% and the 10-year German Bund yielding around 2.27%.
03
MUFG
This loose monetary policy stance sets the BOJ apart from its US and European counterparts, according to MUFG strategists. "We think this divergence will highlight the stability of the Japanese equity investment environment."
