Monday, 20 July 2015

A few macro and related stories today...

A few macro and related stories today...

Greece - A quieter weekend (finally!) for all Greece watchers...but need to watch the cautious reopening of the banks (including an increase in allowed withdrawals to Euro420/day), and an increase in value added tax on restaurant food and public transport from Monday, are aimed at restoring trust inside and outside Greece after an aid-for-reforms deal last week averted bankruptcy (more detail here)

Don’t forget there is another vote this week…and continued election chat for later this year as noted in today's Financial Times:

China – a general rebound continues with weekend reports that house prices fell in fewer than half the 70 cities monitored in June for the first time in over a year and earlier in the session ChiNext heading for bull market having rebounded 21% from July 7th low and the Shanghai Composite regained the 4,000 index point level

I liked this graphic on Chinese property prices and the outperformance of the first tier...

(h/t @TomOrlik)

Meanwhile – and about time – a tightening of standards from the Chinese authorities:

Australia – “Commodities crash could turn Australia into a new Greece” (link here). A little bit over the top in my view but shows how negative sentiment has become to the space.

Gold - I talked about some potential disappointment / mis-truths with the Chinese reserve data that came out late last week (see the MUST READ story on Stories we should be thinking about - link here).  Nevertheless today's price action was very cautious with the shiny metal sub US$1100 in early Asian trading (but recovered a little now to be down 1%+)

A few other thoughts included this observation related to potential dumping/margin sales in the local Chinese market...

According to ANZ, the sudden collapse in gold prices earlier in Asia was due to 5 tonnes of bullion being dumped on the Chinese market. As the Bank states, "half an hour after the market opened we saw 5 tonnes of gold sold through the Shanghai gold exchange, which is way above normal levels."

I also note that the shiny commodity is at a very interesting technical level...

(h/t @DavidInglesTV)

Cyber attacks – look who is not worried: China/Russia!

US interest rates – 9 odd years without a hike is really quite a long time…not a normal cycle at all. 

(h/t @jsblokland)

Growth of German trade surplus – a clear imbalance for Europe

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