📰 What’s moving Markets?

Stocks:

• Shares in Asia trade lower this morning while US and European futures are mixed as ECB's Joachim Nagel and Boris Vujcic express doubts about controlling inflation and halting interest rate hikes.

• Eurostoxx 50 futures price 20bps lower but FTSE 100 futures are up 40bps as UK consumer confidence rebounds by 5 points to -25 in August.

• Investors await Jerome Powell's speech for insights into the Fed's monetary policy path: S&P 500 futures are up 10bps but Nasdaq 100 futures are down 10bps.

• US stocks dropped yesterday due to warnings of potential interest rate hikes and mixed economic data. The S&P 500 fell 1.3% while the Nasdaq Composite lost 1.9%.

Bonds:

• Budget shortfalls and potential interest rate hikes drive US yields to the highest level since 2007.

• US Treasury yields rise: 2-year Treasuries up 0.07% to 5.02%, 10-year notes rise 0.05% to 4.24%.

FX:

• US dollar strengthens by 0.6% against a basket of six peer currencies, reaching June highs.

• Chinese yuan stabilizes with stronger daily mid-points to support the currency.

Commodities:

• Concerns over China's growth and the dollar's strength impact crude oil prices: Crude oil faces second weekly decline, with Brent crude up 0.4% to $83.66, and WTI rising 0.4% to $79.36.

📊 Chart of the Day

Electricity prices for US households are up 30% since the pandemic started.

US Electricity Prices since Jan-19

🤿 Deep Dive

Why are investors fleeing from Chinese assets, and what can China do to win them back? Find out in this article.

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

• Global investors are leaving China due to dissatisfaction with its economic revival efforts.

• China's slow and vague measures to boost its economy and property market have disappointed investors.

• The CSI300 index has fallen 9%, foreigners sold 78 billion yuan in the longest selling streak since 2015.

• Investors demand more government spending and fiscal stimulus to restore confidence.

• Concerns about lack of policy response, slow economic growth, and property crisis are driving investor retreat.

📆 Coming up this Week

Monday 21st August

• German PPI (YoY) consensus: -5.1%, last: 0.1%, actual: -6.0%

Company earnings (EPS): Zoom (beat)

Tuesday 22nd August

• Australia Manufacturing PMI consensus: 49.6, last: 49.6, actual: 49.4

• Japan Manufacturing PMI consensus: 49.5, last: 49.6, actual: 49.7

Company earnings (EPS): Lowe’s (beat), Baidu (beat)

Wednesday 23rd August

• France Manufacturing PMI consensus: 45.2, last: 45.1, actual: 46.4

• Germany Manufacturing PMI consensus: 38.6, last: 38.8, actual: 39.1

• Eurozone Manufacturing PMI consensus: 42.4, last: 42.7, actual: 43.7

• Canada Retail Sales (MoM) consensus: 0.0%, last: 0.2%, actual: 0.1%

• United States S&P Global US Manufacturing PMI consensus: 49.4, last: 49.0, actual: 47.0

• Euro Zone Consumer Confidence consensus: -14.0, last: -15.1, actual: -16.0

Company earnings (EPS): Nvidia (beat), Analog Devices (miss), Snowflake (beat)

Thursday 24th August

• United Kingdom GfK Consumer Confidence consensus: -29, last: -30, actual: -25

• Japan Tokyo Core CPI (YoY) consensus: 2.9%, last: 3.0%, actual: 2.8%

• Japan Tokyo CPI (YoY) consensus: 3.0%, last: 3.2%, actual: 2.9%

Company earnings (EPS): Intuit (beat)

Friday 25th August

• German GDP (YoY) consensus: -0.2%, last: -0.2%