Daily Update 23 July, 2021

Global Markets Update

U.S. equity markets closed higher overnight, with the Dow Jones up +0.1%, S&P 500 up +0.2% and NASDAQ closing +0.4% higher. Applications for U.S. state unemployment insurance rose unexpectedly in week ended July 17 by the most since late March, with initial jobless claims totalling 419k, up 51k from the prior week. Sales of previously owned U.S. homes rose for the first time in five months in June with contract closings increasing +1.4% MoM to an annualized 5.86 million, as housing inventory improved slightly.

Long-dated U.S. treasury yields were lower, with the 2-Yr yield at 0.200% and the 10-Yr yield at 1.267%.

European markets. European equity markets closed mostly higher overnight, with the Stoxx Europe 600 up +0.6%, after ECB kept rates unchanged at -0.5% and said it will persist with ultra-loose monetary stimulus until it has solid evidence that it can sustainably hit its new inflation goal of 2%, vowing it won’t necessarily react immediately if price growth exceeds that target for a “transitory” period. German DAX was up +0.6% and U.K. FTSE 100 closed -0.4% lower.

Asian markets. Asian equity markets closed higher overnight, with the Shanghai Composite gaining +0.3%, with sentiment in the property sector boosted after developer China Evergrande Group said it had solved legal disputes with China Guangfa Bank and that the two sides would deepen business cooperation. The Hang Seng was up +1.8%, KOSPI up +1.1% and Nikkei 225 was closed for a holiday.

WTI oil is trading at US$71.71 a barrel. Iron ore price is at US$208.85 per ton. Spot gold is trading at US$1,807 per oz.

ASX performance. The ASX 200 closed +1.06% higher yesterday, after data revealed Australia’s preliminary merchandise trade surplus was A$13.3bn in June, with iron ore posting a record export value of A$17.6bn.

Lynas Rare Earths Ltd (LYC) was up +9.0%, after being awarded A$14.8m Australian government grant to commercialize an industry-first Rare Earth carbonate refining process that has been developed by the Company’s research and development team. Iluka Resources Ltd (ILU) was up +7.2%, after reporting 2Q21 mineral sands revenue of A$391.1m, up +74% y/y.