SOUTH KOREA: Business Surveys Still Pessimistic, but Improving
May-27 22:35
- Whilst business surveys in South Korea remain pessimistic, further analysis points to an improving trend.
- The last time the Business Survey Manufacturing printed above 100 (above 100 = more optimists than pessimists) was August 2022
- Yet despite the threat of tariffs and trade war and the ongoing political uncertainty, May's result of 94.7 is the fourth reading in a row where things have improved and the highest print since July last year.
- The Business Survey Non Manufacturing last printed at 100 in June 2023 and whilst a reading of 88.1 remains some distance from 100, the improving trend is evident.
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CHINA: Press Conference at 10am Beijing
Apr-27 22:34
- China's National Development and Reform Commission, Ministry of Human Resources and Social Security, Ministry of Commerce and the PBOC will hold a joint press briefing today at 10am in Beijing as per a notice from the State Council Information Office.
- The topic of the press conference will be policies on stabilizing employment and ensuring that growth remains stable whilst promoting high quality development.
- Authorities on Friday vowed to keep improving the range of policies available to them to support the economy and indicated that plans developed are to be brought forward.
- China's equity futures are flat this morning in expectation and the CGB 10yr is at 1.66% where it has been stationary over recent days.
CHINA: Industrial Profits Up in the Face of Trade Tensions
Apr-27 22:32
- Over the weekend China released their industrial profits for March.
- Rising +2.6% YoY this took the gain for the first quarter to +0.80%
- For China’s economy to gain momentum industrial profits need to strengthen, a move that would breathe confidence across businesses in the face of the trade war.
- Manufacturing companies focused on the technology space saw their profits rise +3.5% on the back of a decline of over -5% in the first two months of the year.
- More than 50% of sectors reported profit growth in March.
- On Friday China’s authorities stated that they are readying ‘emergency plans’ to protect the economy from external shocks on account of the US trade war as it aims to achieve 5% economic growth this year.
- The week ahead sees Manufacturing and Non-Manufacturing PMI’s released for April with market forecasts suggesting that manufacturing PMIs may slip into contraction.
GOLD: Gold to Consolidate this Week
Apr-27 22:29
- Compared to recent weeks, gold had a very modest week last week finishing down by a mere -0.21%.
- Up over 25% year to date on trade war concerns, gold is one of the best performing assets in what is proving to be a volatile start to the year.
- Reaching a new all-time high of US$3,423.98 this month, gold has surged through most predictions at the beginning of the year.
- Gold starts the trading week this week in Asia at $3,319.72
- Key central banks globally have reported increases to their gold reserves, boosting demand for the precious commodity.
- Data out from the CFTC last Friday showed that Hedge Funds have reduced the number of their gold longs to the lowest level in one year indicating that the rally for now may be stalled.
- For now, all major moving averages are pointing upwards: a sign that the bullish momentum remains in place but with the CFTC positioning data, it is possible we could see a modest week for gold should trade war headlines not dominate.
