Early premarket gappers
- Gapping up:
- LBRT +11.4%, SHLX +8.9%, FFIV +7.6%, WIRE +6.5%, NTB +5%, AIN +5%, BDN +4.9%, BABA +4.3%, RRC +4.2%, CLS +4%, CALX +3.4%, SGEN +3.3%, UHS +3.2%, KREF +2.6%, BRO +2.3%, PCH +2.3%, WHR +2%, CDNS +2%, UL +1.8%, TBI +1.6%, IRTC +1.3%, ARE +1.1%, SSD +1%
- Gapping down:
- AAN -25.9%, ALGT -18.5%, BBIG -13%, PETS -10.6%, WMT -9.1%, UBS -7%, HXL -6.3%, WAB -5.4%, TGT -5.1%, LEGN -5%, KSS -4.4%, DLTR -4%, TJX -3.9%, ROST -3.8%, M -3.7%, AMZN -3.5%, DG -3.3%, JWN -3.2%, SUI -2.6%, AGNC -2.5%, VERV -2.3%, WALD -2.3%, DKL -2.2%, NXPI -2%, NKTX -1.8%, CNC -1.7%, BURL -1.5%, TRMR -1.3%, CONN -1.2%, GM -1.1%, UPS -1%, KALU -0.8%, LOGI -0.7%
>>> Up
* Awilco LNG Raised to Buy at Arctic Securities; PT 8 kroner
>>> Down
* Basic-Fit Cut to Sell at Berenberg; PT 33 euros
* Fiskars Cut to Hold at SEB Equities; PT 20 euros
* HeidelbergCement Cut to Neutral at Exane; PT 56.50 euros
* Sinch Cut to Hold at Berenberg; PT 30 kronor
* Stora Enso Cut to Neutral at Exane; PT 17 euros
* Vicat Cut to Neutral at Exane; PT 32 euros
>>> Initiation
* CVG IM Rated New Outperform at EnVent S.p.A.; PT 5.06 euros
* Havila Kystruten Rated New Neutral at SpareBank; PT 20 kroner
* ITM Power Rated New Buy at Peel Hunt; PT 500 pence
* Teleperformance Rated New Outperform at RBC; PT 400 euros
* Veolia Reinstated Underweight at JPMorgan; PT 22.50 euros
>>> CallMargin Pressures Spark Europe Profit Cuts, Morgan Stanley Says
*
* Basic-Fit Gets Only Sell as Berenberg Says Lots ‘Could Go Wrong’
* DSV Raises Profit Outlook as Trade-Lane Congestion Boosts Prices
* ITM Power Has ‘Commanding’ Attributes, New Buy at Peel Hunt
* Morgan Stanley Warns Stock Bulls Deluded by ‘Wishful Thinking’
* Sinch Cut to Hold at Berenberg With Sentiment Now ‘Tarnished’
* Stora Enso Cut to Neutral at Exane on Cautious Pulp Outlook
* Teleperformance a New Outperform at RBC as Long-Term Winner
* Veolia Rated Underweight at JPMorgan on Energy Crisis Pressures
Stocks in Asia received a fillip Tuesday from China’s technology sector, helping to alleviate some of the caution in global markets ahead of a hotly anticipated Federal Reserve interest-rate hike. An Asian share index pushed higher, with Alibaba Group Holding Ltd. leading the advance in China tech. The e-commerce giant plans to seek a primary listing in Hong Kong, paving the way for investors in China to directly buy its shares.
S&P 500 and Nasdaq 100 futures were in the red but off the day’s lows. Sentiment had taken a knock from a late-day slide in retailer Walmart Inc. on a disappointing profit outlook. Its projection could fan worries about corporate prospects as the US flirts with a recession amid tightening monetary settings. The 10-year US Treasury yield was little changed, oscillating around 2.79%. Traders are braced for a wave of debt sales and a widely expected 75 basis points Fed rate rise on Wednesday, part of campaign to tackle inflation. A dollar gauge is near the lowest level since early July. Commodities rallied, taking oil to $98 a barrel. But Bitcointumbled to the brink of $21,000. Markets are bracing not just for the Fed and any policy signals from Chair Jerome Powell, but also corporate reports from the likes of Apple and Alphabet. Other risks include ongoing disruptions to European gas supplies from Russia as well as China’s Covid curbs and property woes. Ed Yardeni, president of Yardeni Research, argues the S&P 500’s plunge last month to a 3,666.77 low likely marked the trough of the 2022 equity rout. He cites the resilience in corporate earnings and the still-healthy outlook for consumers and businesses even as the US economy slows. US After Hours WMT -10% falls on lowered profit outlook, takes other retailers with it TGT -5.2%; FFIV +5.7%, WIRE +5.6%, TBI +4.9% higher on earnings
Nikkei -0,09% Hang Seng +1,52% CSI +0,84% Shanghai +0,76% Shenzen +0,84%
Eur$ 1,0226 CNH 6,7563 CNY 6,7527 JPY 136,54 GBP 1,2062 CHF 0,9647 RUB 58,50 TRY 17,8460 WTI$ 97,94 Gold 1,721,40 +0,80% BTC 21,112 ETH 1,425,79 -0,60%
S&P -0,27% Nasdaq -0,33% EuroStoxx -0,11% FTSE +0,12% Dax -0,04% SMI
Macro :
- Bitcoin Sinks to One-Week Low Amid Bout of Global Market Nerves
- CS Sees Opportunities in VIX as VVIX Falls to Almost 3-Year Low
- *BILL TO REGULATE STABLECOIN DELAYED UNTIL SEPTEMBER: DJ
- Morgan Stanley Warns Stock Bulls Deluded by ‘Wishful Thinking’
Keep an eye on :
- ACS SM : *ACS, ACCIONA, ABERTIS WIN EU550M TOLL ROADS LAWSUIT: EXPANSION
- AAD GY : Amadeus Fire Maintains FY Operating Ebita Forecast
- AMBUB DC : Ambu Gets US FDA Clearance of Single-Use Bronchoscope
- COIN US : Coinbase Faces SEC Investigation Over Cryptocurrency Listings
- DSY FP : Dassault Systemes Boosts FY Non-IFRS EPS Forecast
- DSY FP : Dassault Systemes Extends Pact With Hyundai Motor by Five Years
- DSV DC : DSV Boosts FY Ebit Before Significant Items Forecast
- EDEN FP : Edenred Sees FY Ebitda EU770M to EU820M, Est. EU787.2M
- ELUXB SS : Whirlpool Cuts FY Ongoing EPS Forecast (10
- ENR GY : Siemens Says Transport of Nord Stream 1 Turbine Can Start: Rtrs
- ETL FP : Eutelsat FY Revenue Matches Estimates
- ETL FP : Eutelsat, OneWeb to Combine in $3.4B All-Share Deal
- FUR NA : Fugro 2Q Adjusted Ebit EU40.7M Vs. EU31.7M Y/y
- G IM : Generali's $65 Billion Problem Is Both Political and Sentimental
- IDIA SW : Idorsia 2Q Operating Loss CHF212M, Est. Loss CHF209.8M
- KESKOB FH : Kesko 2Q Adjusted Ebit Beats Estimates
- LISN SW : Lindt & Spruengli 1H Ebit Beats Estimates, Plans 1 Billion Franc Share Buyback Program
- LOGN SW : Logitech Guidance Cut Shows 2023 Hiccup; Long Term Intact: React
- MC FP :
- MBG GY : Mercedes Rastatt Plant to Pause This Week Over Microchips: DPA
- NDX1 GY : Nordex Gets Contract for 148-MW Wind Farm in Finland
- RAND NA : Randstad 2Q Organic Revenue Beats Estimates
- RCO FP : Remy Cointreau 1Q Revenue Beats Estimates
- RIO LN : Rio Tinto’s China Demand, Dividend, Shipments in Focus: Preview
- SCATC NO : Scatec 2Q Ebitda Misses Estimates
- SIGN SW : SIG Group 1H Revenue Beats Estimates
- SOF BB : Sofina Prelim 1H Net Asset Value per Share EU302
- SOI FP : SOITEC 1Q Like-for-Like Sales +6%
- UBSG SW : UBS Group 2Q Net Income Misses Estimates
- UCG IM : Italy’s FSI, Bancomat sign MoU For Possible Partnership
- UNA NA : *UNILEVER 2Q UNDERLYING SALES +8.8%, EST. +7.39%
- VALN SW : Femsa Publishes Prospectus on Public Tender Offer for Valora
- VAR NO : Var Energi 2Q Avg Production 210,000 BOE/D
- WAC GY : Wacker Neuson Narrows FY Ebit Margin Forecast
- WMT US : Walmart Lowers Profit Outlook for 2Q and 2023
China June FX Outflows Are The 2nd Highest Since The Covid Crash
With China's economy slowing to levels not seen this century...
... and its financial system in danger of disintegration should the housing crash escalate further (which is why in a sharp reversal to months of non-action, overnight Beijing launched a multi-billion fund to support struggling developers), many have been wondering how long will local oligarchs wait before (quietly) pulling their money out of the country.
Well, according to the most accurate gauge of FX flows, June saw another month of net outflows of around US$9BN, in comparison to inflows of US$2bn in May, the biggest outflow since February and the second biggest outflow in two years going back to the Covid crash.
Cross-border RMB flows suggest net payments of RMB from onshore to offshore, which was consistent with the continued bond outflows.
Here are the main highlights:
1. In June, there were US $4BN in net inflows via onshore outright spot transactions, and US $2BN inflow via freshly entered and canceled forward transactions. Another SAFE dataset on “cross-border RMB flows” shows that domestic banks made net RMB payments of $15BN from onshore to offshore. A preferred FX flow measure therefore suggests in total $9BN outflows in June, in comparison with $2BN inflows in May.
2. Current account saw small net inflows: Goods trade surplus translated into $25BN inflows in June, vs $8BN in May. Here Goldman notes that while goods trade surplus rose to a record-high level of $98BN in June, the conversion ratio of goods trade surplus remained low at 26%, vs an average of 39% in the prior six months. Previous analyses suggested the conversion rate tends to decline when CNY weakens and interest rate spreads narrow. According to SAFE, corporates' FX hedging ratio increased to 26% in 1H 2022, 4% higher than the same period last year. Services trade deficit remained muted at $6BN. Income and transfers account showed an outflow of $16BN in June, partially on seasonality.
3. Portfolio investment showed outflows in June. Stock Connect data suggests more northbound buying of equities (relative to southbound buying) in the month, and thus on a net basis, translates into around $4BN inflows through Stock Connect in June. China Central Depository & Clearing and Shanghai Clearing House data suggest foreigners continued to reduce their holding of RMB bonds by US$13.9bn in June, vs US$16.3bn outflows in May.
4. Official FX reserves (released earlier in the month) fell to US$3,071bn in June from US$3,128bn in May. Estimating for FX valuation effects would have lowered FX reserves by $34BN in June, so after adjusting for FX valuation effects, FX reserves declined by US$23bn in June. Note that decline in bond and equity prices might have also contributed to the overall decline in reported FX reserves through asset price valuation effect, although SAFE does not release the exact decomposition of China’s FX reserves.