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According to the Financial Times, Alibaba has appointed Zhou Jingren to lead its artificial intelligence division.The yield on five-year Japanese government bonds rose 2.5 basis points to 1.850%.On April 10th, it was reported that AliExpress, Alibabas cross-border e-commerce platform, is preparing to hold a closed-door brand summit in Shenzhen on April 15th. The summit is strictly by invitation only to leading brands, and open registration is not accepted. 99 brands, including Xiaomi and Dreame, have been invited, and invitations have been disbursed. It is understood that half of the speakers are from overseas, and the combined overseas sales of the attending brands exceed one trillion yuan.On April 10th, reports surfaced that Amazon would begin a new round of layoffs in May, with an estimated 14,000 jobs affected, primarily in core business units including AWS, retail, and human resources. Some teams in China were even rumored to be completely eliminated. On April 10th, Amazon stated that these reports were untrue.On April 10th, Bank of America Securities issued a report stating that Innoscience (02577.HK) management indicated in the analyst briefing following the 2025 fiscal year results that downstream demand is expected to be strong in 2026 due to the increasing penetration rate of gallium nitride (GaN) in various end markets. Management projects total revenue for fiscal year 2026 to reach RMB 2 billion to 2.5 billion, representing year-on-year growth of 65% to 106%, with gross margin potentially further improving to over 15%. The bank reiterated its buy rating on Innoscience, but lowered its target price from HKD 108 to HKD 92. Bank of America stated that due to a more conservative gross margin forecast, it lowered its adjusted net profit forecasts for Innoscience for 2026 and 2027, but raised its revenue forecasts by 3% to 4% for the same period.

The XAU/USD pair attempts to regain $1,730 prior to Fed Chair Powell's address

Alina Haynes

Sep 08, 2022 16:58

截屏2022-06-07 下午5.14.07.png

 

Gold price (XAU/USD) gains bids to reestablish intraday high at $1,718 as the US dollar retreats ahead of Thursday's big events. In doing so, the yellow metal extends yesterday's recovery from the one-week low amid weaker yields and a mixed risk profile.

 

US 10-year Treasury yields extend Wednesday's fall from the highest levels since mid-June to 3.23%, which weighs on the US Dollar Index (DXY), which retreats to 109.50, extending yesterday's losses from the 20-year high.

 

The recent decline in yields may be attributable to the market's rush into bonds prior to the crucial European Central Bank (ECB) Monetary Policy Meeting and Fed Chair Jerome Powell's speech. However, rumors about Japan's probable involvement to preserve the home currency via the bond market appear to have depressed yields.

 

Due to Beijing's role as one of the world's largest gold buyers, contradictory news from China should have also contributed to the XAU/USD's comeback.

 

Three persons with knowledge of the situation were cited by Reuters when they reported encouraging news for China's property sector. Reuters said that "Zhengzhou pledged to restart all halted housing projects within 30 days by utilizing special financing, requiring developers to refund misused funds, and encouraging certain real estate businesses to file for bankruptcy."

 

Nonetheless, the risk-negative news regarding covid and Taiwan appeared to impose downward pressure on metal prices. The South China Morning Post (SCMP) previously reported, "Shenzhen lowers Hong Kong visitors' admission quota." Reuters' report that Taiwan and the United States are preparing for closer ties further dampens the mood.

 

While reflecting market sentiment, S&P 500 Futures post modest gains, whilst Asia-Pacific equities remain divided.

 

In conclusion, the ECB's 75 bps rate hike can limit a short-term decline in the XAU/USD before a new decline, if Powell sounds hawkish. As the ECB's ability to tighten monetary policy is restricted compared to the Fed's, the gold price is likely to remain in the bears' sights. Also, economic concerns originating from Europe are not ruled out, giving gold bears cause for optimism.


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