☆ 21:30 U.S. unemployment rate in December, non-agricultural employment population after quarterly adjustment in December.
☆ 23:00 US ISM non manufacturing PMI in December and monthly rate of factory orders in November.
☆ At 00:15 the next day, Governor Cook of the Federal Reserve discussed the inflation outlook.
☆ Total number of oil wells drilled in the week from the United States at 02:00 the next day to January 6.
Market Overview
Review of Global Market Trend
On Thursday night, Beijing time, the ADP employment data, which is known as “small non farm”, recorded an increase of 235000 people, which was much higher than the expected increase of 150000 people and the previous value of 127000 people. This shows that although the Federal Reserve has repeatedly raised interest rates aggressively, the U.S. labor market is still overheating, which strengthens the market's expectation that the Federal Reserve still has room to keep raising interest rates. After the data was released, the dollar index rose by more than 0.5% and stood at 105. However, after Brad, the hawk of the Federal Reserve and the chairman of the St. Louis Federal Reserve, claimed that the interest rate was close to a level that was sufficiently restrictive to the economy, the increase narrowed, and it closed 0.89% higher at 105.14.
The yield of US Treasuries stopped falling for two consecutive times. The yield of 10-year US Treasuries once rose nearly 9 basis points, from 3.69% to around 3.72% within the day; The yield of two-year US bonds, which are more sensitive to interest rates, rose by more than 10 basis points within the day, and the yield of 10-year US bonds was far away from the two-week low hit on Wednesday. As of the closing of the US stock market, the yield of the two-year US debt had traded around 4.45%.
Due to the rise of both US dollar and US bond yields, spot gold stopped hitting a new high for at least half a year for four days in a row, and began to weaken before the ADP employment data was released. After the data was released, it fell more than 7 dollars in a short term, and then expanded its decline, falling below 1830 dollars at one time and giving back its gains in the previous two trading days, closing 1.18% lower at 1832.7 dollars/ounce; Spot silver fell for three consecutive trading days in the New Year, closing 2.21% lower at $23.24/oz.
After hitting the biggest two-day decline in the beginning of the year in 30 years, crude oil finally got rid of the more than three week low on Thursday. Because the latest US EIA data showed that the growth of commercial crude oil inventory excluding strategic reserves in the US was lower than expected as of December 30, and the decline of refined oil inventory and gasoline inventory was lower than expected. After the EIA data was released, the price of WTI crude oil rose more than $1 in the short term, and then increased. WTI crude oil once approached $75, and by the end of the day, the growth narrowed to 0.98%, to $73.9 per barrel; Brent crude oil closed 1.05% higher at US $78.84 per barrel.
Investors began to pay attention to the risk of tight natural gas supply after European natural gas fell sharply due to warm winter weather suppressing demand for several days. European natural gas ended its three-day decline and rose by more than 10%, while British natural gas even rose by nearly 20%.
US stocks closed. A series of US economic data released on Thursday evening strengthened the feasibility of the Federal Reserve to continue to tighten its policy. The Dow closed 1.02% lower, the NASDAQ and the S&P 500 index closed 1.47% and 1.17% lower, respectively. China's general stock has gained strength for three consecutive days. The NasdaqChina Golden Dragon Index closed 1.61% higher, Futu Holdings rose 11.3%, Sungrow Science rose more than 200%, and Shell rose 7.7%.
European stocks were mixed, with Germany's DAX30 index closing 0.36% lower, Britain's FTSE 100 index closing 0.63% higher, France's CAC40 index closing 0.22% lower, Europe's Stoxx 50 index closing 0.37% lower, Spain's IBEX35 index closing 0.54% higher, and Italy's FTSE MIB index closing 0.14% lower.
Hot spots in the market
1. Speech by Federal Reserve officials – Brad: The interest rate is still slightly lower than the enough restrictive level; The idea of revising the inflation target is very bad. Inflation may decelerate more slowly than expected by the market; Reduction of year-end assessment. George: It is appropriate to keep the interest rate above 5% for a long time in 2024. Bostick: Inflation is surprisingly high, which is the biggest headwind of the American economy.
2. The Federal Fund Interest Rate Swap is currently priced at a terminal interest rate of 5.03% in June, which is about 6BP higher than yesterday.
3. The valuation of OpenAI, the founder of the AI chat robot ChatGPT, doubled to $29 billion over 2021.
4. McCarthy, who made concessions, has not yet been elected Speaker of the House of Representatives of the United States, and the voting record of the House of Representatives on this matter has been erased back to 1859.
5. The US trade book in November recorded the smallest deficit since September of the previous year; The number of people applying for unemployment benefits at the beginning of the week was lower than the expected 204000; The service industry PMI recorded a higher than expected 44.7 in December.
6. Under the release of a series of economic data conducive to the continued tightening of the Federal Reserve's policy and the hawkish speeches of officials, the major stock indexes of the US stock market closed down more than 1%, and the Chinese stock market rose for three consecutive days; The oil price rebounded, the US dollar strengthened and the gold price fell back, all of which were in the range of 1%.
7. Türkiye's stock index triggered a secondary circuit breaker on Thursday, down 7%.
8. In 2022, the average annual temperature in Britain will exceed 10 ℃ for the first time.
9. Putin instructed the Russian Ministry of Defense to cease fire for 36 hours at the contact line throughout the territory of Ukraine during the Orthodox Church Christmas period. Heurged the Ukraine side to simultaneously announce a ceasefire. Zelensky rejected the proposal, saying that it was just a “cover” for the Russian side to strengthen its front positions.
Geopolitical Situation
1. Putin instructed the Russian Ministry of Defense to cease fire for 36 hours on the contact line throughout the territory of Ukraine during the Orthodox Christmas period. Heurged the Ukraine side to simultaneously announce a ceasefire. Zelensky rejected the proposal, saying it was unnecessary, but the Russian side strengthened the “cover” of the front positions.
2. The two countries of Germany will deliver armored vehicles to Ukraine, which is a major firepower upgrade that Zerensky urgently seeks. Among them, the United States will include about 50 Bradley combat vehicles in the weapons aid program for Ukraine, which will be announced on Friday; Germany will provide Ukraine with weasel tank destroyers and Patriot missile systems.
3. Information Office of the Russian Ministry of Defense: The Russian air defense system shot down 21 Ukrainian UAVs, 5 “Hippocampus” rockets and 4 “Ham” missiles in the past 24 hours.
4. According to the Associated Press, the United States will provide Ukraine with nearly $3 billion in military assistance.
5. The US Ministry of Defense confirmed that it is expected to announce a new round of security assistance to Ukraine on Friday.
6. Government of Ukraine: According to preliminary estimates, Ukraine's GDP will decline by 30.4% in 2022, lower than expected.
7. Kremlin: Putin confirmed to the President of Türkiye that if Ukraine meets the preconditions related to territory, Russia is willing to conduct dialogue on the Ukrainian issue.
8. Russian Ministry of Finance: Compared with 2021, the average price of Ural oil in 2022 will increase by 10.3% to US $76.09 per barrel.
9. Ministry of Defense of Belarus: Russia and Belarus will conduct air force exercises.
Agency News
1. Goldman Sachs：As central banks maintain hawkish positions, keep interest rates at a high level, and investors flee high priced technology stocks, value stocks may shine again this year.
2. SOCIETE GENERALE：As the tightening policy of the European Central Bank becomes the focus, the euro may rise in early 2023.
Societe Generale said that the euro may rise at the beginning of 2023, because of active risk appetite, falling energy prices and the possible easing of the conflict between Russia and Ukraine, which will make the market pay more attention to the tightening of the European Central Bank's policy. Olivier Korber, foreign exchange strategist of Societe Generale, said that the forecast of the Federal Reserve showed that compared with the European Central Bank's forecast of inflation in the euro area, the rate of inflation in the United States decreased much faster. Therefore, the European Central Bank is expected to raise interest rates significantly, and its interest rate raising cycle may last longer than that of the Federal Reserve. Korber said, “Even though the seasonal factors in January showed that the euro started slowly against the dollar/USD, it is expected that the trend will accelerate as it moves towards spring.”
3. MUFG：The 10-year fixed mortgage interest rate will be raised from 3.52% to 3.7%.
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