Aug 12 2021 0
China showing their strength. A new wave appears in Korea. The economy seemingly recovers from the Delta variant. All of them will have great impacts on the market today. Read more below.
- July CPI of the US came in at 5.4%, slightly higher than the expectation of 5.3%, the market took this as a sign of peaking inflation.
- The USD benefited from last week's impressive US jobs data and from Fed officials' comments about earlier tightening, however it plunged after the CPI data.
- The US Senate has passed a $1 trillion infrastructure package and is now moving to the House of Representatives for approval. In addition, the Senate also approved the framework for the Democratic Party's $3.5 trillion spending plan.
- Investor sentiment is faltering in Europe, with a survey in Germany showing its third worst month in a row, as the global spread of the Covid-19 pandemic rattled markets.
Strong moves from China
China is showing efforts to deeply and deeply regulate parts of its economy to achieve its goal of stable and sustainable development in the next five years. According to a statement released by the State Council later in the day, the areas they will regulate include national security, technological innovation and antitrust activities. Law enforcement will be strengthened in areas such as food, drug crime and education, where everyone's immediate interests are at stake, the statement said. The next target is the country's insurance technology platforms. The country's banking and insurance regulator has ordered companies and local agencies to curb inappropriate pricing and marketing practices, while strengthening user privacy protections. They say those who do not comply will face "severe punishment." In another development in China, the central bank is facing calls to cut interest rates as the novel coronavirus outbreak threatens the economic recovery.
Asian stocks rising
Asian stocks looked set for modest gains after US stocks and Treasuries rallied on signs of moderate inflation, easing concerns about an impending Federal Reserve stimulus cut. state. Futures markets rallied strongly in Japan and Australia, and stabilized in Hong Kong. U.S. stock futures wavered after the S&P 500 hit a record and the tech-biased Nasdaq 100 fell as investors turned to cyclical stocks. Treasuries rallied after a strong auction of 10-year notes and a US inflation report backed the Fed's assessment that the reopening of price pressures is temporary. The dollar depreciated.
Recovery from the Delta variant
The global economy is still showing signs of optimism despite a rise in the Delta variant, with early signs from the third quarter of rapid growth and a peak in inflation following the recent jump. According to an "instant forecast" from Bloomberg Economics, global gross domestic product in the third quarter is on track to grow 1.8 percent from three months earlier. Meanwhile, New Zealand is accelerating the rollout of the vaccine as it plans to start reopening its borders in 2022. California orders all teachers and school personnel to be vaccinated or tested regularly. and the UK say fully vaccinated adults will no longer be legally required to self-isolate if they come into contact with a case of coronavirus.
The race for the deal
Bank of America is catching up to its biggest rival, JPMorgan, in investment banking in the Asia-Pacific, as a three-year business rebuild with a focus on winning contracts. big successful start. The investment bank now contributes about 15% to Bank of America's overall business in Asia, more than double what it was three years ago. In other banking-related news, a year after becoming the world's first major financial center to tame the virus, Shanghai is on high alert - and masks are on. is working again. More than 470,000 financial professionals, who have mostly returned to work and have not worn masks since the middle of last year, now face frequent temperature checks to enable contact tracing.
New giants in Korea
A new class of wealthy Korean businessmen is taking over the wealth rankings in South Korea, surpassing the families behind the country's decades-old mega-corporations known as "chaebols". Brian Kim, founder of mobile messaging app Kakao Corp., is the most prominent example with a fortune of $12.9 billion, who recently replaced Samsung conglomerate heir Jay Y. Lee as Samsung heiress Jay Y. Lee. richest man in the country. But there are still many other self-made billionaires around. The change of head is a sign that South Korea's $1.6 trillion economy is entering a new era of growth.