India is printing fiat explicitly to buy Gold and Silver now
Today:
Commentary: The Yen and the Markets
Premium: Goldman Trader Comments on yesterday’s activity
Equity Recap:
Stocks sold off around the globe, led by losses in chipmakers, as STMicro cut its annual revenue outlook again, and BE Semi issued weak third-quarter guidance.
Premium Markets:
Goldman Trader Weighs in on JPY moves and Tech Selloff
Asia risk dominated by JPY strength/unwinds (NKY -3.2%) as “The Bank of Japan is likely to debate whether to raise interest rates when it meets next week and unveil a plan to roughly halve bond purchases in coming years, sources said, signaling its resolve to steadily unwind its massive monetary stimulus.”
Big sell off across global markets yday with really the tech/ai complex under significant pressure. Think underestimated the scrutiny around GOOG and the question about the lack of incremental returns around their ai investment (this could be a theme for hyperscalers).
Yen Carry Trade Unwind
JPY has extended its upside vs. the USD to a 4th consecutive session with the Yen benefiting from risk-aversion, efforts by officials to guide the currency lower, an unwind of carry trades and mounting expectations of a hawkish BoJ at next week's meeting.
Precious metals are lower across the board despite the softer Dollar and risk aversion amid a broader downturn in metals in what is seemingly an unwind of winning trades. Spot gold slipped from a USD 2,401.31/oz high, through the psychological figure and to a current USD 2,365.91/oz low.
Base metals also trade on the backfoot amid the broader risk aversion and ongoing pessimism regarding Chinese demand.
Conclusion. Goldman is looking at what price China buying will come back. Therefore while their target may be the same for 2025 they are not bullish right now. Thus.. Why are they putting this report out? For the report to be written at all implies clients were asking.
Goldman did a similar thing on Oil a couple years back, and oil rocketed a week later. Though this is not the oil analyst.
More at bottom
Market News:
"The National Basketball Association said it has signed landmark media-rights deals worth $77 billion with Disney’s ESPN, Amazon and Comcast’s NBCUniversal, Source: WSJ
"IBM’s revenue and adjusted earnings per share were higher than expected. Source: CNBC
"Washington’s most powerful business interests have had five decades to learn what makes Joe Biden tick... Kamala Harris’ quick rise to potential Democratic nominee has them wondering what to expect — and worrying about whether her presidency would bring Biden 2.0,Source: Politico
"Airlines are bracing for the end of the “revenge travel” boom, cutting ticket prices to fill surplus seat capacity as a two-year post-pandemic surge gives way to a more uncertain outlook. Source: FT
"Ford Motor came in short of Wall Street’s second-quarter earnings expectations while beating on revenue, due to warranty costs that have plagued the automaker for several years now.Source: CNBC
"CrowdStrike, the cybersecurity company that upended computer systems across the world last week, said it had identified a quality-control flaw that led to outages for millions of Microsoft Windows users and how it got onto its systems. Source: WSJ
Politics/Geopolitics:
US senior official said Gaza ceasefire negotiations appear to be in their closing stages and negotiators have worked out a pretty detailed text of the arrangements for how a Gaza hostage deal would work
Ukrainian Navy spokesman said Russia has pulled all its vessels out of the Sea of Azov, according to Reuters.
Russian Foreign Ministry says experts from Russia and the US have met to discuss Ukraine although the ministry does not see such contacts as practical because the US side is biased, according to RIA
Some headlines via NewSquawk or DataTrek
Data on Deck: GDP and PCE
MONDAY, JULY 22 None scheduled
TUESDAY, JULY 23 PMI July 55.0 55.3
WEDNESDAY, JULY 24 10:00 am New home sales
THURSDAY, JULY 25 8:30 am GDP Q2 1.9% 1.4%
FRIDAY, JULY 26 8:30 am PCE index June 0.1% 0.0% 1
