Market Talk - Tuesday, June 1

ASIA:

China has announced that it will allow couples to have up to three children after census data showed a steep decline in birth rates. The cost of raising children in cities has deterred many Chinese couples. The latest move was approved by President Xi Jinping at a meeting of top Communist Party officials.

Chinese businesses are letting go of more workers than they are hiring, even though the economy is seeing some recovery from the pandemic, official data showed on Monday. That is based on a survey from the National Bureau of Statistics, which polls businesses on how their operations have changed from the prior month, and compiles the responses into two Purchasing Managers’ Indexes — one for manufacturing and one for services. For both manufacturing and services, the employment index remained below 50 in May, the statistics bureau said. That indicates businesses were laying off more workers than they were hiring.

India’s annual economic growth rate picked up in January-March compared with the previous three months, but economists are increasingly pessimistic about this quarter after a huge second wave of COVID-19 infections hit the country last month. Gross domestic product grew 1.6% in January-March compared with the same period a year earlier, mainly driven by state spending and manufacturing sector growth, data from the statistics ministry showed on Monday. Economists said the country faces a slowdown in consumer demand as household incomes and jobs have declined, with limited scope for the government to offer growth stimulus due to its rising debt.

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 decreased 45.74 points or -0.16% to 28,814.34
  • Shanghai increased 9.24 points or 0.26% to 3,624.71
  • Hang Seng increased 316.20 points or 1.08% to 29,468.00
  • ASX 200 decreased 19.00 points or -0.27% to 7,142.60
  • Kospi increased 17.95 points or 0.56% to 3,221.87
  • SENSEX decreased 2.56 points or -0.03% to 51,934.88
  • Nifty50 decreased 7.95 points or -0.05% to 15,574.85

The major Asian currency markets had a mixed day today:

  • AUDUSD increased 0.00084 or 0.11% to 0.77543
  • NZDUSD decreased 0.00249 or -0.34% to 0.72535
  • USDJPY decreased 0.05 or -0.05% to 109.44
  • USDCNY increased 0.01496 or 0.23% to 6.38458

Precious Metals:

  • Gold decreased 3.56 USD/t oz. or -0.19% to 1,902.80
  • Silver decreased 0.049 USD/t. oz or -0.17% to 28.003

Some economic news from last night:

China:

Caixin Manufacturing PMI (May) increased from 51.9 to 52.0

Japan:

Capital Spending (YoY) (Q1) decreased from -4.8% to -7.8%

Manufacturing PMI (May) increased from 52.5 to 53.0

South Korea:

Exports (YoY) (May) increased from 41.1% to 45.6%

Imports (YoY) (May) increased from 33.9% to 37.9%

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