top of page
Writer's pictureAda Tam Ying Ying

Market Update 31st May - 6th June 2022

Updated: Jun 6, 2022

The cost behind underestimating Inflation...


Last week, the OPEC had agreed to ramp up the crude oil production in the coming 2 months as the ban on Russian oil persisted. That had enlightened the global energy market and pushed the Thursday's stock markets to rally. But that seemed a little short-lived as the worry of heading for another recession continued to linger... especially the news of Tesla CEO Elon Musk sending email to all the employees about 10% head count reduction on Friday, rekindled the unemployment concerns whether recession could become unavoidable. In actual fact, any decline in economic activities can trigger companies to cut costs ahead of any possible dropping demands.


Oil prices dropped more than 2% following a report that Saudi Arabia is prepared to raise crude production if Russia's output significantly falls under European Union sanctions.

Source : www.cnbc.com


Another noteworthy point was the remarks from the US Treasury Secretary Janet Yellen on her misjudgement on inflation last year, giving signal about the inflations may continue to stay high in the near future and this will inevitably weaken the spending power of consumers.


🌀 Focus Point: Investors need to take note of the commodities are the most positively correlated with inflation. During COVID in the last 2 years, quantitative easing measures needed to be in placed to rescue the economies from collapsing, the increase supply of money had almost pushed the cost of money to zero to keep all businesses going. And today, reversing this off-balance market situation back to a healthy level, the forex markets will be for sure one of the first few to feel the commotions. In fact, some of you may start to feel the tension right now whenever the US stock markets are retreating, and the U.S. dollar is gaining strength against other currencies elsewhere. Today, these strenuous relationship is almost instantaneous with the surging commodities price whenever the situations get intensify at the Russia-Ukraine war or the EU-Russia sanctions.



Treasury Secretary Janet Yellen says she was wrong about inflation. "I was wrong about the path inflation would take," Yellen said in an interview that aired Tuesday on CNN. Bloomberg's Annmarie Hordern reports on "Bloomberg The Open."

Source : www.youtube.com


"Well, look, I think I was wrong then about the path that inflation would take," Yellen said Tuesday. "As I mentioned, there have been unanticipated and large shocks to the economy that have boosted energy and food prices, and supply bottlenecks that have affected our economy badly that I didn't at the time didn't fully understand. But we recognize that now."



China issues policy package to stabilize economy

"On May 31, 2022, China's State Council released a set of 33 measures in a document titled Policy Measure Package to Stabilize the Economy (“the policy package”), covering a wide range of mechanisms aimed at supporting businesses impacted by the COVID-19 pandemic."


For investors who are active in HK market, should know by now that 20,000 points level is the unbreakable level because crossing this critical breaking point confirmed the entering of recession. With the China government giving its utmost support to Hong Kong, it had issued a comprehensive stimulus package last week to give its best effort in pulling the economies out of the woods, investors can watch closely whenever HSI falling back to 20,000 support level again for buying opportunities.


On May 31, 2022, China’s State Council released a set of 33 measures in a document titled Policy Measure Package to Stabilize the Economy (“the policy package”), covering a wide range of mechanisms aimed at supporting businesses impacted by the COVID-19 pandemic. The policy measures were first introduced during a routine State Council meeting on May 23.

Source : www.china-briefing.com



Focus Point : Blockchain, NFTs and the Metaverse


Besides Tesla CEO Elon Musk who admitted in owning a crypto portfolio and continued in showing his supports... there are many other famous crypto investors that still hold on to their digital money. It may not be absolutely related, but today investors should be vigilant enough to pick up information like checking on the crypto holding of individual companies if any, and its CEO to decide whether the company performance is insulated from the fluctuation of bitcoins.


JP Morgan has reiterated its view that US$38,000 is a fair price for bitcoin, 20% higher than the digital asset’s value at press time. The investment bank’s strategist last provided the fair value estimate in February.

Source : www.theedgesingapore.com


 

Other Focus (Results and Highlights of Corporate Actions):

  • ESR-LOGOS REIT prices $150 mil worth of subordinated perpetual securities with 5.50% p.a. coupon

  • OCBC prices $500 mil worth of perpetual capital securities with 3.90% coupon

  • Fed's Bullard sees 3.5% rates setting up cuts in 2023 or 2024

  • ComfortDelGro's Australian subsidiary wins bid to operate bus services in Darwin

  • Sunseap partners Huawei to generate solar energy efficiently for Singapore

  • Elon Musk wants to cut 10% of Tesla jobs, has 'super bad feeling' about economy

  • Facebook parent Meta COO Sheryl Sandberg is stepping down

  • Amazon announces 20-for-1 stock split

  • The Hour Glass to acquire freehold property in Brisbane for $81.4 mil

  • EC World REIT's refinancing raises concerns despite analysts' upbeat report

  • YTL Power acquires Hyflux's Tuaspring power station for S$270m in cash

  • Singtel partners Lendlease to transform Comcentre HQ into $3 bil next-gen landmark development

  • MAS-licensed Green Link Digital Bank has begun its banking business in Singapore

  • (6th Jun) China Construction Bank Singapore issues $350 million infrastructure bond

  • (6th Jun) Lawrence Wong promoted to DPM, to be acting PM in PM Lee's absence

  • (6th Jun) CLP Signs MoU with ESR For Developing Sustainable Data Centre Projects

  • (6th Jun) Temasek launches investment subsidiary GenZero, focused on decarbonisation

  • (6th Jun) Ant Group soft launches its digital wholesale bank in Singapore

  • (6th Jun) Credence Partners sells entire stake in Kim Heng to Hildrics Capital at 10.5 cents each

  • 6th June: Amazon stock to trade on a 20-for-1 split-adjusted price



Coming Market Focus (Extract):

Sunday, June 5, 2022

CNY

Caixin Services PMI, May

Monday, June 6, 2022

Holidays

New Zealand, South Korea, Switzerland, Norway

Tuesday, June 7, 2022

AUD

RBA Interest Rate Decision, Jun

SGD

Foreign Reserves USD mom May

USD

Exports, Imports, Trade Balance Apr

USD

API Weekly Crude Oil Stock

JPY

GDP qoq yoy q1

Wednesday, June 8, 2022

USD

Crude Oil Inventories

CNY

Exports, Imports, Trade Balance May

EUR

GDP qoq yoy Q1

Thursday, June 9, 2022

EUR

ECB Interest Rate Decision Jun, ECB Monetary Policy Statement

CNY

CPI mom May, CPI yoy May, PPI yoy May

USD

Initial Jobless Claims

Friday, June 10, 2022

USD

CPI, Core CPI mon yoy May

USD

Federal Budget Balance May

Investment Tips 💡 this month (June 2022🦉:)


STI continued to hover at 3200 critical level. Meanwhile I'm still holding a bearish view on the overall markets, and prefer to take short-term profit if happen to buy at low. However, I don't expect much of any sudden big drop in any major indexes but rather, the oil and gas prices may surge to another new high (probably more missile launches in North Korea, or Russia-Ukraine war may become worsen) and conflicts of interests amongst countries, especially over food or any form of natural resources, will likely get intensify and drag down the pace of the global economic recovery.


Number of new Bonds had been pushing out for launch in the market with higher coupon rate since the mid of May, and therefore we need to be watchful with our debt financing as the interests on bank loans is expected to increase soon in this quarter.



Tesla, which has electric vehicle factories in the United States, China and Berlin, employs around 99,290 staff worldwide, so culling 10 per cent of jobs could equate to losses approaching 10,000 ...

Source : www.straitstimes.com



 

CASH PLUS Promotion:

Low-commission trading account is available... and check out for Promotion Details

(Waived for US and HK Foreign Custody fee until 31 December 2022.)




 

Important Disclaimer

A. Reminders: 1. Phillip Securities Pte Ltd ("PSPL") will generally provide you "execution only" services - see Guide and Cautionary Notes for Trading Accounts on www.poems.com.sg. You are therefore personally responsible to make your own decisions on the suitability of every securities transaction you do through PSPL. One exception is if you specifically apply and pay for advice from PSPL. The other is referred to in reminder 2. 2. Execution-Related Advice ("ERA") on listed Excluded Investment Products may be given to you, but only subject to strict conditions. These include (a) you accepting personal responsibility to ensure any such advice is suitable before you act on it, and (b) you ensuring that you both receive and understand the rationale for every ERA given to you. 3. Materials (including market and analyst reports) are provided to you as information on an execution only basis for you to make your own suitability decisions. Materials which are not ERA are provided strictly as you asked. These reminders apply to the contents of this e-mail as well as any and all accompanying materials sent under its cover. B. General Disclaimer: The information/materials provided (whether as attachments to this e-mail or in its body), where they are not ERA on listed Excluded Investment Products in compliance with the second reminder above, are provided for general information/circulation only and not intended and therefore should not be taken as any offer or solicitation to do any investment or trade. No assessment has been made by PSPL as to the suitability for you of any materials in or under this e-mail. As always, the decision to trade and/or invest remains solely with you. Information/materials in or under this e-mail are provided as is without warranty of any kind, either express or implied. Such information/materials provided have been procured from sources which are believed to be reliable and accurate (but whose reliability and accuracy cannot be and are not warranted); and may have been acted on by PSPL or members of the PhillipCapital group of entities before being made available to you. All investments are subject to investment risks. Ideally you should and you may wish to seek advice from an independent financial adviser before making a commitment to purchase or invest in the investment product(s) mentioned either in this e-mail or its attachment(s). If you choose not to do so, you are then choosing to make your own decision on whether any of the said investment product(s) are suitable for you. Neither PSPL nor any fellow member of the PhillipCapital group of entities shall, in any event, be liable to you for any direct/indirect or any other damages of any kind arising from or in connection with your reliance on any information in and/or materials attached to this email. C. General Confidentiality Note: This e-mail and its attachment(s) are intended only for the use of the recipient(s) named above. If you have received this message in error, please notify the sender immediately and delete all copies of it.


Confidentiality Note

This e-mail and its attachment(s) are intended only for the use of the recipient(s) named above. If you have received this message in error, please notify the sender immediately and delete all copies of it.

15 views0 comments

Kommentare


bottom of page