📰 What’s moving Markets?

Stocks:

• Asian shares, including China's, are falling due to concerns about China's economy and fears regarding long-term U.S. interest rates. CSI 300 is down 0.55% and Nikkei 225 has losses of 0.65% today as Japan reports higher than expected inflation (3.3% YoY headline CPI versus 2.5% estimates)

• China's state-owned property developers have signaled potential losses, with 18 out of 38 builders reporting preliminary losses for the first half.

• U.S. stocks face potential volatility due to $2.2 trillion of longer-dated contracts tied to U.S. stocks and indexes maturing.

• Rising yields have negatively impacted stock indices, with Nasdaq dropping by 1.2% and the S&P 500 decreasing by 0.8%. US European futures are mixed.

• Corporate highlights: Applied Materials reported bullish earnings, while companies like Evergrande face challenges.

Bonds:

• Yields on 10-year U.S. Treasuries reached 4.328%, hinting at a departure from the post-financial crisis era of low rates.

• UK 10-year gilt yields and Germany's bond yields are nearing highs not seen since before the 2008 financial crisis.

• Central banks maintain hawkish stances, fueling concerns that they might not decrease rates soon.

FX/Crypto:

• Bitcoin has fallen 8% over the last 24 hours to 20,742.96 as the risk-off market sentiment weighted on the price leading to the liquidation of long BTC positions on crypto exchanges.

• The dollar is nearing a two-month high, while the yen weakened to levels not seen since November, prompting speculation of potential intervention by Japan.

• Inflation data in Japan suggests the Bank of Japan may maintain its monetary easing stance.

Commodities:

• Brent crude oil prices remained steady.

• Gold prices saw a minor increase, currently standing at $1,893.6 per ounce.

📊 Chart of the Day

The valuation for stocks in the Nasdaq 100 has eased, with the index now trading at 4.6 times Price/Sales ratio; significantly below the 6 times peak reached during the Covid-19 market frenzy.

Nasdaq 100 Price to Sales Ratio since 2018

🤿 Deep Dive

Fresh off the press: UK Retail Sales fall by 1.2%. Source.

If you’re pressed for time, here’s the TL;DR:

• UK retail sales dropped by 1.2% in July due to heavy rainfall and rising interest rates.

• The decline was steeper than the anticipated 0.5% drop after a strong June.

• Poor weather conditions benefited online retailers as consumers shopped from home.

• Concerns arise about the UK economy potentially entering a recession if GDP falls in the upcoming quarters.

📆 Coming up this Week

Monday 14th August

• Japan GDP (YoY) consensus: 3.1%, last: 2.7%, actual 6.0% 

• China Industrial Production consensus: 4.5%, last: 4.4%, actual: 3.7%

• China Retail Sales consensus: 4.8%, last: 3.1%, actual: 2.5%

Company earnings (EPS): Suncor (beat), monday.com (beat)

Tuesday 15th August

• Canada Headline CPI (YoY) consensus: 3.0%, last: 2.8%, actual: 3.3%

• United States Retail Sales consensus: 1.50%, last: 1.49%, actual: 3.17%

• United Kingdom Unemployment Rate consensus: 4.0%, last: 4.0%, actual: 4.2%

• Japan Industrial Production consensus: 2.0%, last: -2.2%, actual: 2.4%

Company earnings (EPS): Home Depot (beat), Nu (miss), Sea (miss)

Wednesday 16th August

• Euro Zone GDP (YoY) consensus: 0.6%, last: 1.1%, actual: 0.6%

• Euro Zone Industrial Production consensus: -0.6%, last: 0.2%, actual: 0.5%

• Australia Unemployment Rate consensus: 3.5%, last: 3.5%, actual: 3.7%

• Japan Trade Balance consensus: 24.6B, last: 43.0B, actual: -78.7B

• United States Industrial Production consensus: 0.3%, last: -0.5%, actual: 1.0%

• United Kingdom Headline CPI (YoY) consensus: 6.8%, last: 7.9%, actual: 6.8%

• United Kingdom Core CPI (YoY) consensus: 7.4%, last: 6.9%, actual: 6.9%

Company earnings (EPS): Target (beat), Cisco (beat), Tencent (miss)

Thursday 17th August

• Japan National CPI (YoY) consensus: 2.5%, last: 3.3%, actual: 3.3%

• United States Jobless Claims 4-Week Avg. consensus: 229.63K, last: 231.00K, actual: 239K

• United States Philadelphia Fed Manufacturing Index consensus: -10.0, last: -13.5, actual: 12

Company earnings: Walmart (beat), Applied Materials (beat)

Friday 18th August

• Euro Zone Core CPI (YoY) consensus: 5.5%, last: 5.5%

• Euro Zone Headline CPI (YoY) consensus: 5.3%, last: 5.5%

Company earnings: John Deere, XPeng