Don't You Scare ？

Don't You Scare ？

08/15/2018，Wed，Sunny， Air Perfect

Summary：Market recovered from Turkey shcok and spoiled by Italy issue again. Another easing is on the horizon.

Euro Session:

Duration dipped lower across the curve with very thin volume while Asia equities mixed, Nikkei 2.22%, Heng Seng and CSI300 in red.

 

Almost at the moment EU session stepped in, USDTRY slumped which looked like profit taking. The sentiment obviously improved anyway. Both EUR and GBP were boosted by the stronger GE Q2 GDP. German economy expanded by 0.5% in 2Q, accelerating from 0.4% in Q1, coupled with a small upward revision to Q1 growth

 

EU equities gapped higher and cores were under pressure while periphery were boosted. Lira went on surging as local retail accounts were reported to sell dollars. Even GBP shook off recent weakness before jobs data. And finally speculators got their lucky day as UK employment beat the expectation which boosted GBP to fresh day high. But soon after that , the weakness of euro currencies soared out until a bunch of data came mixed at 5 o'clock.

 

Around the midnight, Italy Salvini told reporters that Italy may have to question whether the external constraints on spending for maintaining Italian infrastructure. Obviously he was bargaining before the final edition of fiscal budget, while this kind of rhetoric disturbed the market again , EUR and GBP slumped 60 and 50 pips respectively.

Economy data:

2:00, GE Q2 GDP preliminary 0.5% qoq vs 0.4%, prior 0.3% revised up to 0.4%; 2.3% yoy vs 2.5%, prior 1.6% revised down to 1.4%.

GE July final CPI 0.3% mom vs 0.3% , preliminary 0.3%; 2% yoy vs 2%, preliminary 2%.

2:45, France July final HICP -0.1% mom vs -0.1% mom, preliminary -0.1%mom; 2.6% yoy vs 2.6% yoy, preliminary 2.6%.

4:30, UK Apr-Jun unemployment 4.0% vs 4.2%.

5:00, GE Jun ZEW expectation -13.7 vs -21; current conditions index 72.6 vs 72.1.

EC Q2 preliminary GDP 0.4% qoq vs 0.3%, prior 0.3%; 2.2% yoy vs 2.1%, prior 2.1%

EC Jun IP -0.7% mom vs -0.4%, prior 1.3% revised up to 1.4%; 2.5% yoy 2.4% , prior 2.4% revised up to 2.6%.

US Session:

The appreciation of lira definitely supported the risk sentiment. But when US session came in, it turned out to be a choppy time. That said, there were not obvious signals of a thawing in tensions between the US and Turkey during the 15 hours after Asia closed. US Embassy in Turkey released a statement saying it had met with Pastor Brunson and called on authorities in Turkey to resolve his and other cases of Americans detained in Turkey promptly and in a transparent manner. Later, a US State Department spokeswoman said that conversations are continuing on Pastor Brunson.

 

When we talk about the strength or weakness of USD, the DXY could always be the focus. Under the background of trade tension, we'd better pay more attention to trade weighted index as showed in the chart below. Usually it takes 8 months for the import price to reflect the one-way appreciation or depreciation of the home currency. If the similar things happened in US, Although the import price has already hit multi-year high, the single upside pressure due to the weakness of USD before April 16 this year could last in the coming 2-3 months.

 

Economy data:

6:00, US July small business optimism 107.9 vs 106.8, prior 107.2

8:30, US import price index 0.0% mom vs 0.0%, prior -0.4% revised up to -0.1%. 4.8% yoy vs 4.5% , prior 4.3% revised up to 4.7%.

 

Key Data And Events Ahead:

 

EC trade balance

UK CPI

US Empire manufacturing , NF productivity, retail ,IP, capacity utilization

Comments:

The market did try hard to recover from Turkey shock. Right now, risk markets stabilize as emerging markets calm and spillover concerns subside. As described above, the Italy budget never leave us far away. Unlike the Turkey turmoil, the market still react to Italy headlines in a decent way. If EU could comprise with Italy to some extent, I do think the cost must be the delay to ECB calendar based QE exit plan. And have you even noticed our treasure declared the speedup of local government bonds yesterday afternoon? That's definitely the bearing drum of massive incentive policy carrying out. So it won't be too surprised to see 10 yr UST well under 3%. Right now the fund flow into US equity is still good, into FI marginally weaker, which is not too bad. But when the song ends, we can't completely exclude the possibility of another word of " I favor weak dollar".

ps: It's said the picture below is magic. Make a wish and it will come true! YANG CHAOYUE !

个人微信zhangke8639，欢迎同业交换名片。公众号更新速度快一点儿....排版也好一点点儿....

近期重要时间点：

8月17日，公众200bn清单提交书面请求截止日

8月20-23日，200bn听证会

8月25日，Jackson Hole 研讨会

8月26日，意大利财长Tria访华

9月3日，第二批A股纳入MSCI

9月5日，200bn听证会后申诉材料提交截止日

9月13日，ECB议息

9月26日，FOMC

9月，日本LDP选举,半岛峰会在平壤

9月27日，意大利提交财政预算案

10月25日,ECB议息

10月31日，BOJ议息

11月6日，美国中期选举开始

11月8日，FOMC

11月11日，美国阅兵

12月13日，ECB议息

12月20日，FOMC

12月22日，改革开放40周年

2019年3月29日，脱欧谈判截止

Appendix：his t overnight

0814 0816 “Trump’s foreign policy is actually boosting America’s standing” https://t.co/oC7Xs38uRo

0814 0946 Scott Walker of Wisconsin is a tremendous Governor who has done incredible things for that Great State. He has my complete & total Endorsement! He brought the amazing Foxconn to Wisconsin with its 15,000 Jobs-and so much more. Vote for Scott on Tuesday in the Republican Primary!

0814 0946 https://t.co/Gm9KE8cHpS

0814 0956 .@MarkBurnettTV called to say that there are NO TAPES of the Apprentice where I used such a terrible and disgusting word as attributed by Wacky and Deranged Omarosa. I don’t have that word in my vocabulary, and never have. She made it up. Look at her MANY recent quotes saying....

....such wonderful and powerful things about me - a true Champion of Civil Rights - until she got fired. Omarosa had Zero credibility with the Media (they didn’t want interviews) when she worked in the White House. Now that she says bad about me, they will talk to her. Fake News!

0814 1906 Tom Fitton of Judicial Watch: “The Strzok firing is as much about the Mueller operation as anything else. There would be no Mueller Special Councel to investigate so called collusion but for the machinations of Strzok & his colleagues at the top levels of the FBI. We know this...

....guy was corrupt and had anti-Trump animus. Strzok and others at the FBI should be criminally investigated for the way the conducted this investigation. Instead, Mueller is pretending nothing went wrong. He used Strzok, he used the Clinton DNC Dossier...the whole thing....

....should be shut down. The Strzok firing shows that the fundamental underpinnings of the investigation were corrupt. It should be shut down by the courts or by honest prosecutors.” Thank you Judicial Watch, I couldn’t have said it better myself!

0814 1926 Lou Dobbs: “This cannot go forward...this Special Councel with all of his conflicts, with his 17 Angry Democrats, without any evidence of collusion by the Trump Campaign and Russia. The Dems are the ones who should be investigated.” Thank you Lou, so true!

0814 1931 When you give a crazed, crying lowlife a break, and give her a job at the White House, I guess it just didn’t work out. Good work by General Kelly for quickly firing that dog!

0814 1949 Another terrorist attack in London...These animals are crazy and must be dealt with through toughness and strength!

0814 1956 Bruce Ohr of the “Justice” Department (can you believe he is still there) is accused of helping disgraced Christopher Steele “find dirt on Trump.” Ohr’s wife, Nelly, was in on the act big time - worked for Fusion GPS on Fake Dossier. @foxandfriends

0814 2011 “They were all in on it, clear Hillary Clinton and FRAME Donald Trump for things he didn’t do.” Gregg Jarrett on @foxandfriends If we had a real Attorney General, this Witch Hunt would never have been started! Looking at the wrong people.

0814 2102 Fired FBI Agent Peter Strzok is a fraud, as is the rigged investigation he started. There was no Collusion or Obstruction with Russia, and everybody, including the Democrats, know it. The only Collusion and Obstruction was by Crooked Hillary, the Democrats and the DNC!

0814 2111 Strzok started the illegal Rigged Witch Hunt - why isn’t this so-called “probe” ended immediately? Why aren’t these angry and conflicted Democrats instead looking at Crooked Hillary?

0814 2116 Lou Dobbs: “This cannot go forward...this Special Counsel with all of his conflicts, with his 17 Angry Democrats, without any evidence of collusion by the Trump Campaign and Russia. The Dems are the ones who should be investigated.” Thank you Lou, so true!

0815 0223 “Hope and Change in an Alabama Coal Mine” https://t.co/IwLEO9ff9X

Disclaimer：This material was prepared in private name and out of party time hobby,definately based upon facts and robust analysis with delicate consideration of highly professionality.But with no means to conduct any trade , and before using the contents of this note in any internal or external communication, please ensure you are comfortable and fully aware this could not be sufficient enough as any action base.

Up till now, Subscribers have amounted to 3944 ！

$(NTES)$,$(MOMO)$,$(JNJ)$,

 $(JD)$, $(IQ)$,$(EDU)$