Daily Update 6 August, 2021

Global Markets Update

U.S. equity markets closed higher overnight, with both the Dow Jones and NASDAQ up +0.8% and S&P 500 gaining +0.6%, after data revealed applications for U.S. state unemployment benefits fell in the week ended July 31 with initial jobless claims declining 14k to 385k, sign that Americans are slowly, and in fits and starts, returning to work as the economy recovers. The U.S. trade deficit widened to a record in June with the gap in trade of goods and services growing +6.7% to $75.7bn, as imports increased +2.1% to $283.4bn driven in part by inbound shipments of higher-priced petroleum products and exports rose +0.6% to $207.7bn.

Long-dated U.S. treasury yields were higher, with the 2-Yr yield at 0.20% and the 10-Yr yield at 1.220%.

European markets. European equity markets closed mostly higher overnight, with the Stoxx Europe 600 up +0.4% and German DAX up +0.3%. The U.K. FTSE 100 closed flat, after the BOE left its benchmark interest rate unchanged at 0.1% and signalled that its concerns over inflation are strong enough to warrant the withdrawal of some support to the U.K. economy over the next three years, announcing it now expect annual price growth to peak higher than expected around 4% and confirming it will start to unwind 875bn pound quantitative easing program when the interest rate reaches 0.5%.

Asian markets. Asian equity markets closed mostly lower overnight, with the delta variant continuing to be a concern as Tokyo reported record daily new coronavirus cases, China imposed new travel restrictions and deaths mounted in Southeast Asia. The Shanghai Composite was down -0.3%, Hang Seng down -0.8%, KOSPI down -0.1% and Nikkei 225 gained +0.5%.

WTI oil is trading at US$69.19 a barrel. Iron ore price is at US$179.25 per ton. Spot gold is trading at US$1,805 per oz.

ASX performance. The ASX 200 closed +0.11% higher yesterday. Australia’s exports advanced +4% MoM in June with overseas shipments to China increasing to their highest ever, and imports grew +1% MoM, leading to the country’s trade surplus widen to a new record.

Resolute Mining Ltd (RSG) gained +4.5%, after agreeing to sell Bibiani mine for $90m to Ghanaian start-up Asante Gold Corp.