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Shares of CSPC Pharmaceutical Group (01093.HK) fell more than 10% in the afternoon, with the company’s first-quarter net profit down 41.8% year-on-year.On May 27, chip manufacturer UMC held its annual shareholders meeting. Chief Financial Officer Liu Qidong stated that with the expansion of its Singapore plant, costs are higher and the company faces significant challenges. Selective price increases will be implemented in the second half of this year, and in 2027, the company will conduct more comprehensive discussions with customers regarding price adjustments.The Hang Seng Index fell more than 1% in the afternoon, while the Hang Seng Tech Index fell 0.4%.On May 27th, the Reserve Bank of New Zealand (RBNZ) kept the Official Cash Rate (OCR) unchanged at 2.25%, but ANZ Bank stated that the RBNZ is "clearly very inclined to raise rates." The vote was a 3-3 tie, with RBNZ Governor Brehman casting the deciding vote. The released interest rate path chart shows that the OCR will rise faster than expected in February. ANZ Bank stated that the chart implies a very high probability of consecutive rate hikes at the RBNZs next three meetings. ANZ Banks Chief Economist for New Zealand, Sharon Zollner, said, "We still expect three rate hikes this year, in July, September, and October." She added, "We remain open to the possibility that the OCR needs to rise above 3%, but there are many variables to observe before that happens."On May 27th, CLSA issued a research report stating that NIO-SW (09866.HK) achieved non-GAAP profitability for the second consecutive quarter, with first-quarter non-GAAP profit reaching RMB 45 million, in line with market expectations. Regarding expenses, the group continued to demonstrate disciplined spending, reflecting the effectiveness of its operating expense control measures. Synergies between domestic models should increase NIOs market share in the luxury segment, with the ES8 and ES9 models diversifying its profit contribution. The bank forecasts sales of 441,000 vehicles in 2026 and a return to profitability for the full year. Based on NIOs strong performance in the luxury segment and improved expense control, CLSA raised its 2026 revenue and net profit forecasts by 18.9% and 104.1%, respectively, to RMB 133.48 billion and RMB 277 million. The bank maintained its "Outperform" rating on NIOs after-hours US-listed shares, raising its target price from $6 to $7. Meanwhile, the bank initiated coverage of NIOs H shares, giving them an "Outperform" rating and a target price of HK$55.

Copper Beats Gold This Week With Fears of A Rate Rise

Haiden Holmes

Feb 17, 2023 11:44

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Gold prices declined on Friday as stronger-than-expected U.S. inflation statistics and hawkish statements from Federal Reserve officials stoked fears of more interest rate rises, while copper prices outpaced commodity markets this week due to confidence towards China.


The U.S. producer price index inflation increased more than anticipated in January, according to statistics released on Thursday. This follows a report on the consumer price index that indicated inflation in the world's largest economy remained sticky.


James Bullard, president of the Federal Reserve Bank of St. Louis, stated that the central bank might resume raising interest rates at a more rapid pace and raised the possibility of a 50 basis point increase in March.


Meanwhile, Loretta Mester, president of the Cleveland Fed, stated that interest rates would likely rise over 5% as the Fed fights inflation, and that the central bank should have increased rates by more than 25 basis points at its February meeting.


The dollar and Treasury rates soared in response to their remarks, as investors flocked to the greenback in anticipation of higher and safer returns. This caused a substantial outflow from gold markets.


Spot gold decreased 0.2% to $1,833.67 per ounce, whilst gold futures declined 0.5% to $1,843.75 per ounce. Prices of the yellow metal were projected to fall between 1% to 1.7% this week, marking the third consecutive week of declines.


The likelihood of rising U.S. interest rates is unfavorable for non-yielding assets such as gold, as it increases their opportunity cost. Increasing interest rates also cause investors to select the dollar as a safe-haven asset due to its higher yields.


Other precious metals declined on Friday. Platinum prices dropped 0.6% to $920.30 per ounce, a three-month low, while silver futures sank 1.2% to $21.448 per ounce, a two-and-a-half month low.


Copper prices declined on Friday but were expected to end the week in the black due to optimism on China and probable supply disruptions.


Copper futures slipped 0.2% to $4.1137 a pound and were expected to rise 2.4% this week, their highest weekly performance since the beginning of January.


Copper was also poised to end a streak of three consecutive weekly losses as China, the world's top copper importer, signaled further stimulus measures to bolster economic development. Earlier this year, China loosened the majority of anti-COVID policies, which bolstered hopes for the nation's economic recovery.


A deteriorating conflict between the government of Panama and international copper miners threatens to halt the country's copper exports, so limiting supply and driving up prices.

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