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Business 12 THURSDAY, AUGUST 13, 2020
DAILY STOCK INDICES AND SECURITIESMARKET NEWSWATCH
(12/08/20)
MAJOR STOCK INDICES
DJIA : 27,686.91 (-104.49)
S&P 500 : 3,333.69 (-26.78)
HSI : 25,244.02 (+353.34)
STI : 2,559.90 (+15.75)
KLSE : 1,556.64 (-8.10)
SHCOMP : 3,319.27 (-21.02)
REVIEW
US stock futures rose slightly in overnight trading and pointed to gains at the open
on Wednesday after the S&P 500 closed lower for the ‘irst time in eight days. Dow
futures were higher by 54 points. After the bell on Tuesday, President Donald Trump
said the US government will purchase 100million doses of Moderna’s experimental
coronavirus vaccine, which is currently in late-stage human trials. A return of risk
appetite following encouraging economic numbers and hopes of new coronavirus
relief package and even a vaccine boosted the 500-stock index for much of the
trading day on Tuesday. However, the S&P 500 ended the day down 0.8 per cent
— snapping a seven-day winning streak — as technology stocks dropped. The Dow
Jones Industrial Average dippedmore than 100 points but at one point traded above
28,000 for the ‘irst time since February. Earnings seasons continues onWednesday
with Cisco Systems, Lyft and SmileDirectClub all reporting after the closing bell.
Stocks in Asia lat on Wednesday as investors continue to monitor coronavirus
developments. Russia claimed to have developed the ‘irst vaccine in the world,
while the US was in a stalemate over virus aid talks. Mainland Chinese stocks
pared some losses by the close. The Shanghai composite fell 0.63 per cent while
the Shenzhen composite was down 1.26 per cent to 2,215.12. The Shenzhen
component tumbled 1.17 per cent to close at 13,308.52. Hong Kong’s Hang Seng
index rose 1.21 per cent in the afternoon. In South Korea, the Kospi erased earlier
losses, rising 0.57 per cent to close at 2,432.35. Australia’s S&P/ASX 200 lost 0.11
per cent to close at 6,132.00. Meanwhile Japan’s Nikkei 225 traded higher by 0.41
per cent to close at 22,843.96, while the Topix rose 1.23 per cent to 1,605.53.
Gold prices roseon Wednesday, after sinking six per cent in the previous session,
as equities stalled on doubts over an additional round of US ‘iscal stimulus and
rising Sino-US tensions. Spot gold was up 0.5 per cent at USD1,920.04 per ounce
by 0045 GMT due to a bounce in risk appetite and ‘irmer dollar. US gold futures
fell 0.7 per cent to USD1,930.70.
Disclaimer: All information is not intended as professional advice to users. All investment
products and services are not obligations of or guaranteed by Baiduri Capital and are
subject to investment risks.
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Published from Tuesday to Saturday
Published from Tuesday to Saturday
CCY BID OFFER TENOR SGD USD
EUR/USD
USD/JPY
GBP/USD
USD/CHF
AUD/USD
NZD/USD
USD/CAD
USD/HKD
USD/SGD
USD/MYR
USD/THB
USD/IDR
USD/PHP
USD/KRW
1.1752
106.79
1.3061
0.9157
0.7130
0.6547
1.3306
7.7502
1.3735
4.1930
31.09
14685
48.94
1184.24
1.1753
106.82
1.3065
0.9161
0.7131
0.6550
1.3310
7.7504
1.3738
4.1980
31.11
14835
48.96
1184.83
Overnight
1 week
1 mth
3 mth
6 mth
9 mth
12 mth
0.01
0.00
0.00
0.00
0.00
0.00
0.05
0.05
0.03
0.05
0.07
0.11
0.18
0.25
CRUDE AND GOLD PRICES
USD
Gold: 1947.79 1.91
Brent: 44.86 0.36
DAILY INTERBANK FOREX &MONEYMARKET COMMENTARY
(12/08/20)
FX OUTLOOK
The jump in yields was driven by both repositioning ahead of big debt issuance
this week and a sense that the global recovery is looking broader and more robust
- a mood helped somewhat by Russia hailing the approval of a COVID©19 vaccine.
“Investors have been positioning themselves to buy back dollars they had sold
against the yen,” said Mitsuo Imaizumi, chief FX strategist at Daiwa Securities,
adding that a short squeeze was seen as the United States (US) yields spiked.
FX REVIEW
The US dollar inched ahead on Wednesday, as a jump in US yields pushed it
higher against the Japanese yen, while the kiwi brie‘ly hit a one-month low
after the central bank extended its bond buying programme. Sterling held
above USD1.30, clinging on to recent gains on the back of dollar weakness,
which outweighed the impact of a record drop in Britain’s economic output.
The economy shrank by 20.4 per cent between April and June, when the
country’s coronavirus lockdown was tightest, data showed on Wednesday,
representing the largest contraction reported by any major economy so far.
All information provided is not intended as professional advice to users. This daily
commentary and opinion is subject to change without notice. For the latest information,
please call our Treasury Department on 226 8307.
Website: Email:
RIO DE JANEIRO (AFP) - Brazilian
Economy Minister Paulo Guedes
said two of his top deputies
resigned in a “stampede”, news
that could rattlemarket con‘idence
in his reform agenda for Latin
America’s biggest economy.
Guedes, the powerful free-
market guru to far-right President
Jair Bolsonaro, is battling to steer
Brazil back toward his agenda
of austerity and privatisations
- n o e a s y t a s k d u r i n g a
pandemic that has hammered
the country and forced the
government into months of
emergency spending.
Guedes has now lost eight top
aides since Bolsonaro took of‘ice
in January 2019, nearly half his
original team.
He acknowledged in a news
conference that the latest - Salim
Mattar and Paulo Uebel, his
point men on privatising state
companies and administrative
reform, respectively - resigned
in frustration at the slow pace
of both.
“It was a stampede,” Guedes
said. He vowed to get his
reform agenda back on track,
starting by ‘ighting political
pressure to lift the cap on
federal spending.
Speakingalongside theSpeaker
of the Lower House of Congress,
Rodrigo Maia, Guedes said they
agreed that it was time to rein
governmentspendingbackin,after
pandemic emergency measures
such as monthly stimulus checks
of USD110 to help workers hit hard
by stay-at-home measures.
“If the pandemic dies down
by the end of the year, as we’re
all hoping, why would we extend
(emergency spending) into next
year?” he said.
“On the contrary... our reaction
to this stampede today is that we
have to speed up reforms.”
Bolsonaro took of‘ice vowing to
privatise a raft of state companies,
but hardly any have been sold
so far.
Meanwhile, despite the debt
hawks’ efforts, Brazil’s national
debt ballooned from 75.8 per
cent of Gross Domestic Product
in December to a record 85.5
per cent of GDP in June, and is
forecast to hit nearly 100 per cent
by the end of the year.
Specu l a t i on has swi r l ed
recently that Guedes could
be sacked, though Bolsonaro
has publicly stood by him
so far.
Brazil has more infections and
deaths in the pandemic than
any country except the United
States: more than 3.1 million and
103,000, respectively.
Economists polled by the
central bank expect the economy
to contract by a painful 5.62 per
cent this year.
HONG KONG (AFP) - Chinese tech
‘irm Tencent, the parent company
of social media giant WeChat, said
yesterday its revenue jumped 28
per cent in the ‘irst half of this year
as the coronavirus pandemic kept
people glued to their screens.
But the better-than-expected
results were clouded by upcoming
restrictions on WeChat ordered in
the United States (US) by President
DonaldTrump at a time of spiralling
tensions between Washington
and Beijing.
Trump announced a ban from
mid-September on WeChat and
TikTok, which is owned by a
separate Chinese company.
The mobile apps “threaten the
national security, foreign policy,
and economy of the US”, he said
last week.
But for now Tencent - one of the
world’s largest gaming companies
- is enjoying a boost from the
pandemic, with billions of people
forced to stay indoors for weeks
on end under lockdowns.
“During this challenging time,
we utilised our platforms and
technologies to help users adapt
to the new normal via online
tools, to support enterprises in
conducting digital upgrades,
and to broadly contribute to
economic recovery,” it said in
a statement.
First-half revenuewasCNY222.9
and net pro‘it rose 21 per cent on-
year to CNY62 billion.
“InChina, user time spent onour
smartphonegames increasedyear-
on-year but decreased quarter-
on-quarter due to seasonality
and back-to-of‘ice behaviour,”
the company said, re‘lecting the
country’s move out of lockdown
as coronavirus cases dwindled.
But as the disease spread
around the world in spring and
early summer, monthly active
users increased “signi‘icantly”
both year-on-year and between
the ‘irst and second quarter,
it said.
This was “due to new game
launches and more user time
spen t du r i ng t he s t ay- a t -
home period”.
While many companies are
being hammered by the economic
fallout of the pandemic, tech
‘irms worldwide including US
market leaders Apple and Amazon
have seen strong demand for
their products.
WeChat andWeixin, the version
of the app available in mainland
China, have more than 1.2 billion
active users.
Trump’s executive order against
WeChat forces the platform to
end all operations in the US and
bans Americans doing business
with it.
Tencent profits up as
gamers stay home but
WeChat ban looms
A man rides past the Tencent headquarters in Beijing, China. PHOTO: AP
Brazil Economy Minister hit by loss of two top deputies