Observations + News + Charts
• DXY is unchanged. WTI is -75bps. US Nat gas is -35bps. Bitcoin is unchanged at $25.7k.
• US futures are lower w/ESU3 -11.25, HIWU3 is -59.00, and NQU3 -59.50.
Chinese property stocks surged on talk of new stimulus. The mainland properties index gained around 4% Wednesday, however, the general investor malaise around Chinese/HK stocks continues. HSTECH came close to another downside test of the 200-day average but managed to recover from its worst levels. There is a general feeling on behalf of investors to sell Chinese rallies driven by government headlines. As one news story pointed out, investors are clearly deleveraging and will continue to do so until macro data turns higher, thus supporting growth of earnings and higher share prices. The new Huawei Mate 60 phone continues to support Huawei suppliers and Chinese chipmakers. Meanwhile, US said to be seeking more details on how Huawei developed its advanced processor.
European markets also lower this morning after mildly hawkish ECB comments and weaker-than-expected German data. Consumer products sector is the worst performer as luxury goods again today. Yields across the EGB curve a touch higher after comments from ECB. European renewable-energy stocks fall as much as 1.7% today, with the index tracking the sector hitting a three-year low.
US economic data will take the lead this afternoon with services and composite PMI and ISM services metrics to come before Fed Beige Book later tonight. UST yields and USD are steady around yesterday’s closing levels. Softbank’s Arm unit plans to raise up to $4.87B in its upcoming IPO, that’s lower than the street anticipated.