Market Talk – May 13, 2021

Posted May 13, 2021 by Martin Armstrong |

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ASIA:

The mainland China share market finished the session lower on Thursday, May 13, 2021, amid bearish sentiment stemming from rising US inflation and concern to bring forward monetary stimulus tapering, an online business daily reported. Meanwhile, weaker than expected new loan data for April and Sino-U. S. tensions also weighed down sentiments. At the closing bell, the benchmark Shanghai Composite Index declined 0.96%, or 33.22 points, to 3,429.54. The Shenzhen Composite Index, which tracks stocks on China’s second exchange, dropped 0.81%, or 18.51 points, to 2,253.30. The blue-chip CSI300 index fell 1.02%, or 51.58 points, to 4,992.97.

Indian inflation eased to a three-month low in April as food costs rose more slowly, but lockdowns to contain the country’s raging coronavirus epidemic risk creating supply bottlenecks that could fuel price pressures in coming months. Annual retail inflation rose 4.29%, down from 5.52% in March and near the 4.20% forecast in a Reuters poll of economists. Food prices, which account for nearly half of the Ministry of Statistics’ inflation basket, rose 2.02% compared with 4.87% in the previous month.

The major Asian stock markets had a negative day today:

NIKKEI 225 decreased 699.50 points or -2.49% to 27,448.01
Shanghai decreased 33.22 points or -0.96% to 3,429.54
Hang Seng decreased 512.37 points or -1.81% to 27,718.67
ASX 200 decreased 62.20 points or -0.88% to 6,982.70
Kospi decreased 39.55 points or -1.25% to 3,122.11
SENSEX decreased 0.00 points or 0.00% to 48,690.80
Nifty50 decreased 154.25 points or -1.04% to 14,696.50

The major Asian currency markets had a mixed day today:

AUDUSD decreased 0.00049 or -0.06% to 0.77265
NZDUSD increased 0.00173 or 0.24% to 0.71829
USDJPY decreased 0.17 or -0.16% to 109.49
USDCNY decreased 0.00536 or -0.08% to 6.44806

Precious Metals:

Gold increased 9.69 USD/t oz. or 0.53% to 1,825.13
Silver increased 0.03 USD/t. oz or 0.11% to 27.060

Some economic news from last night:

Japan:

Adjusted Current Account decreased from 1.84T to 1.70T

Bank Lending (YoY) (Apr) decreased from 6.3% to 4.8%

Current Account n.s.a. (Mar) decreased from 2.917T to 2.650T

Foreign Bonds Buying decreased from 132.8B to -73.6B

Foreign Investments in Japanese Stocks decreased from 492.2B to 144.8B

South Korea:

M2 Money supply (Mar) increased from 8.90% to 9.60%

Some economic news from today:

China:

FDI (Apr) decreased from 39.90% to 38.60%

Japan:

Economy Watchers Current Index (Apr) decreased from 49.0 to 39.1

EUROPE/EMEA:

Analysts predict a stronger than expected first quarter means the UK economy could be on a steady path for recovery. After shrinking by 2.5% in January, the economy expanded by 0.7% in February and a further 2.1% in March. The stronger than expected performance in the first three months of 2021 means further chunky increases in GDP can be expected in April, May, and June as restrictions are lifted in line with the government’s roadmap. Consumer spending and business investment will increase over the coming months so that by the time the furlough scheme is wound up at the end of September, the economy might be more or less back to where it was in early 2020

The major Europe stock markets had a mixed day:

CAC 40 increased 8.98 points or 0.14% to 6,288.33
FTSE 100 decreased 41.30 points or -0.59% to 6,963.33
DAX 30 increased 49.46 points or 0.33% to 15,199.68

The major Europe currency markets had a negative day today:

EURUSD decreased 0.00012 or -0.01% to 1.20752
GBPUSD decreased 0.00193 or -0.14% to 1.40402
USDCHF decreased 0.00258 or -0.28% to 0.90631

Some economic news from Europe today:

UK:

Thomson Reuters IPSOS PCSI (May) increased from 53.1 to 55.8

Italy:

Italy Thomson Reuters IPSOS PCSI (May) increased from 37.53 to 42.12

Germany:

Germany Thomson Reuters IPSOS PCSI (May) increased from 50.02 to 54.11

France：

France Thomson Reuters IPSOS PCSI (May) increased from 42.86 to 45.44

US/AMERICAS:

New unemployment claims in the US hit a 14-month low last week, according to the Labor Department. Initial claims fell by 34,000 to 473,000 for the week ending on May 8. New York, Florida, and Michigan saw the most notable decreases in initial filings. This is a significant drop from the high in April 2020 of 6.149 million, but remains subdued. Analysts view a US labor force of 200,000 to 250,000 unemployed individuals as a healthy workforce.

Amazon announced plans to hire an additional 75,000 logistic workers throughout the US and Canada. Average pay will begin at $17 per hour, making the company a more attractive option than other labor positions. Additionally, Amazon is offering a $1,000 sign on bonus at certain locations and will provide vaccinated employees with $100.

The Centers for Disease Control and Prevention issued a statement this Thursday declaring that vaccinated individuals do not need to wear masks or adhere to social distancing rules. “Anyone who is fully vaccinated can participate in indoor and outdoor activities, large or small, without wearing a mask or physical distancing,” CDC Director Dr. Rochelle Walensky announced. Masks may still be required in certain situations, such as while traveling, and it is unclear how authorities may ensure people have been vaccinated.

US Market Closings:

Dow advanced 433.79 points or 1.29% to 34,021.45
S&P 500 advanced 49.46 points or 1.22% to 4,112.5
Nasdaq advanced 93.31 points or 0.72% to 13,124.99
Russell 2000 advanced 35.81 points or 1.68% to 2,170.95

Canada Market Closings:

TSX Composite advanced 28.04 points or 0.15% to 19,135.81
TSX 60 advanced 3.26 points or 0.28% to 1,147.21

Brazil Market Closing:

Bovespa advanced 995.88 points or 0.83% to 120,705.91

ENERGY:

The oil markets had a mixed day today:

Crude Oil decreased 2.79 USD/BBL or -4.22% to 63.2900
Brent decreased 2.67 USD/BBL or -3.85% to 66.6500
Natural gas increased 0.003 USD/MMBtu or 0.10% to 2.9720
Gasoline decreased 0.0763 USD/GAL or -3.53% to 2.0847
Heating oil decreased 0.0826 USD/GAL or -3.99% to 1.9869

Top commodity gainers: Orange Juice (1.31%), Gold (0.53%), Feeder Cattle (0.27%) and Silver (0.11%)
Top commodity losers: Oat (-7.68%), Corn (-4.95%), Crude Oil (-4.22%), and Wheat (-4.54%)

The above data was collected around 13:20 EST on Thursday.

BONDS:

Japan 0.0980%(+2bp), US 2’s 0.16%(-0.010%), US 10’s 1.6676%(-2.74bps); US 30’s 2.4026%(-0.01%), Bunds -0.119% (+0.6bp), France 0.273% (+1.4bp), Italy 1.016% (+3bp), Turkey 17.46% (+6bp), Greece 1.056% (+3bp), Portugal 0.600% (+2.1bp); Spain 0.589% (+1.79bp) and UK Gilts 0.898% (+1.1bp).