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According to the Wall Street Journal, sources say Mexico is pushing for lower auto tariffs in the USMCA negotiations.Japans corporate goods price index rose 7.2% year-on-year in July, below the expected 7.4% and the previous reading of 7.10%.Japans corporate goods price index rose 0.1% month-on-month in July, below the expected 0.60% and the previous reading of 0.40%.Futures News, August 13th - According to foreign media reports, Chicago Board of Trade (CBOT) soft red winter wheat futures closed sharply higher on Wednesday, with the benchmark contract rising 3.6%, mainly reflecting the ongoing conflict between Russia and Ukraine, which has disrupted grain exports from the region. Ukrainian President Zelensky stated that this "unique operation" targets the last major stronghold of the Russian Black Sea Fleet. The ongoing conflict between the two countries continues to restrict agricultural exports from the region and has also caused some commodity prices to fluctuate wildly during the conflict.On August 13th, a research report from CICC stated that the seasonally adjusted CPI in the US rose 0.1% month-on-month and 3.4% year-on-year in July, while core inflation rose 0.2% month-on-month and 2.5% year-on-year, both in line with market expectations. Energy prices continued to decline, but international oil prices have rebounded since August, increasing uncertainty about future energy prices. Regarding core inflation, commodities were relatively strong while services were relatively weak, especially with the continued rise in prices of information technology products such as computers and software, reflecting that the supply-demand mismatch caused by the expansion of AI capital expenditure is gradually being transmitted to the consumer side. We believe that US inflation may have entered a new phase, with its driving force gradually shifting from supply shocks such as tariffs and oil prices to demand expansion driven by AI investment, and the duration of inflation may be correspondingly prolonged. For the Federal Reserve, this data alleviates the pressure for short-term interest rate hikes, but demand-pull inflation requires more attention from policymakers than supply-push inflation.

S&P 500 Retreats From Session Highs Amid Rising Geopolitical Tensions

Cory Russell

Nov 16, 2022 17:27


With rising geopolitical tensions, traders profit

Several missiles that landed in Poland and killed at least two individuals caused the S&P 500 to retreat from session highs. A committee on national security and defense matters was invited to an urgent meeting by Poland. Poland hasn't yet stated what it intended to talk about. It is clear that Poland will assess whether these missiles originated from Russia, which today carried out significant strikes against the energy infrastructure of Ukraine.


Poland is a NATO member, therefore the possible escalation of geopolitical tensions is taken into account by the markets. It is not unexpected that traders swarmed to purchase safe-haven assets. The US Dollar Index recovered some of its losses and moved closer to the 107 level. As the demand for safe haven assets increased, gold also found support and reclaimed the $1775 mark.


The price of WTI oil increased toward the $88 mark as Hungary convened its security council to discuss Ukraine's decision to halt oil transit from Russia via the "Druzhba" pipeline. These developments might give oil stocks a lot of support in the coming days.


Putting geopolitics aside, the market has been upbeat today as a result of Walmart's presentation of solid third-quarter results, revised expectations, and $20 billion repurchase program.


Whether the current geopolitical developments will have an impact on the U.S. stock market is the main concern. Following the recent rally, some traders might want to lock in profits in the near future.


In the long run, the suspension of Russian oil exports to Hungary could be a major issue and boost the oil market as the G7 nations get ready to cap the price of Russian oil. Higher oil prices increase inflation, which might make the Fed more hawkish and damage stocks.

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