📈Market Performance
📘U.S. stocks rose across the board:
- The Dow Jones Industrial Average rose 0.49%, the Nasdaq rose 0.95%, the S&P 500 rose 0.77%, and the Russell 2000 rose 0.79%.
- The 2-year Treasury yield rose 6.7 basis points to 4.774%, and the 10-year Treasury yield rose 6.5 basis points to 4.286%.
- The US dollar index fell 0.19% to 105.3287, and the VIX rose 0.71% to 12.75. Brent crude oil rose 2.17% to 84.41.
📘Chinese stocks rose and fell:
- USD/CNH fell 6 basis points to 7.2704.
- The Nasdaq China Golden Dragon Index fell 0.05%, Pinduoduo fell 0.46%, Alibaba rose 1.63%, JD.com rose 1.63%, NetEase fell 0.08%, Li Auto fell 1.91%, Xpeng Motors rose 1.81%, and NIO rose 2.42%.
📘A-shares and Hong Kong stocks rose and fell:
- The Shanghai Composite Index fell 0.55%, the CSI 300 fell 0.15%, and the ChiNext Index rose 0.83%.
- The Hang Seng Index fell 0.03%, while the Hang Seng Tech Index rose 0.05%.
📘European stocks mixed:
- The UK FTSE 100 fell 0.06%, France's CAC40 rose 0.91%, and Germany's DAX rose 0.40%.
- EUR/USD rose 0.29% to 1.0734.
📘Stock markets in Japan, South Korea and emerging markets generally fell:
- Japan's stock market fell 1.83%, South Korea's Composite Index fell 0.52%, India's SENSEX30 was closed, Indonesia's Composite Index was closed, Vietnam's Ho Chi Minh Index fell 0.40%, and Mexico's MXX rose 0.33%.
📍📍Focus on
📘Powell will attend a U.S. Senate hearing on the Federal Reserve's monetary policy on July 9. U.S. Federal Reserve Chairman Powell plans to deliver his semi-annual monetary policy testimony to the Senate Banking Committee on July 9, and may deliver the same testimony to the House Financial Services Committee the next day. The hearing will cover topics such as interest rate policy and the state of the banking system.
📘Philadelphia Fed President Patrick Harker (non-24-year voting member, hawk) said that it is his basic judgment to cut interest rates once this year. Harker believes that the current economic growth is slowing but above the trend, the unemployment rate has risen slightly, and inflation has returned to the target "in the long run". If the economic situation is in line with expectations, it is appropriate to cut interest rates once this year. Harker emphasized that his views on interest rates may change based on new economic data. He said that if economic data changes, the Fed will continue to rely on data to make decisions, and he does not rule out the possibility of cutting interest rates twice or not cutting interest rates this year.
📘China's National Bureau of Statistics released economic data for May:
- China's industrial value added above designated size increased by 5.6% year-on-year in May, in line with expectations of 6% and up from 6.7% in the previous month.
- China's fixed asset investment increased by 4% year-on-year in January-May, in line with expectations of a 4.2% increase and the previous value of 4.2%. Among them, China's real estate development investment fell by 10.1% year-on-year in January-May and by 9.8% in January-April.
- China's total retail sales of consumer goods increased by 3.7% year-on-year in May, in line with expectations of 4.5% and up from 2.3% in the previous month.
- In May, the national urban surveyed unemployment rate was 5.0%, the same as the previous month.
✍️Comment: The economic data in May was lower than expected, which was verified by PMI, CPI, credit data, etc., proving that the macro-economy has repeated fluctuations and endogenous demand is not strong. Looking forward, geopolitical factors may disturb the relatively strong export expectations. The export logic is the main reason for the strong total volume since the beginning of the year. If there is any fluctuation, it may have a significant impact on market expectations. In addition, fiscal policy is still tight at present, and the overall market needs to wait for the policy to continue to be strengthened.
📘The People's Bank of China did not cut interest rates. In June, it renewed the MLF at a reduced volume and parity. The interest rate remained stable for 10 consecutive months. On June 17, the central bank conducted 4 billion yuan of open market reverse repurchase operations and 182 billion yuan of medium-term lending facility (MLF) operations, with the winning bid rates of 1.80% and 2.50% respectively, both the same as before.
✍️Comment: There is still an expectation of lowering the reserve requirement ratio and interest rates within the year. It is expected that the reserve requirement ratio will be lowered first and then the interest rates will be lowered. Currently, due to restrictions on net interest margin and RMB exchange rate, the timing of the reserve requirement ratio cut will be delayed than previously expected, and will be in the second half of the year.
📘China launches anti-dumping investigation into EU pork. The investigation, announced by China's Ministry of Commerce on Monday, will focus on pork for human consumption, such as fresh, cold and frozen whole pork, as well as pig intestines, bladders and pig stomachs. The investigation will begin on June 17. China's pork imports were worth about $6 billion in 2023, of which the EU accounted for more than half and Spain alone accounted for about a quarter. The second and third countries are the Netherlands and Denmark, which exported pork products worth $620 million and $550 million to China respectively last year.
📅Today's Key Events
- 12:30 noon: Reserve Bank of Australia announces interest rate decision
- 20:30 PM US May retail sales data (expected to rise 0.2% month-on-month, unchanged from the previous value)