The Stock Trader Thoughts - Both the Sides

On Saturday, news came out of France, where the United States and Britain “precisely attacked” Syria. A new round of geopolitical development may affect the data release in the coming week, including the minutes of the Reserve Bank of Australia, the Fed speakers, the announcement of the Bank of Canada interest rate, and the Chinese economic calendar including GDP, industrial production, retail sales, and fixed assets data. table. The market's difficulties are often not pricing risks, but they do not know when the risks need to be priced, because geopolitical concerns cause headaches for traders and investors, rather than our more comfortable economic calendar.

The Standard & Poor's/Australia Stock Exchange closed higher on Monday and there will be uncertainty on Monday: S&P Australia's stock market index closed at 5829.10, closing at 0.7% per week. Concerns over Syria's U.S. military strikes have proved to be an active driver of global equity markets, but its catalyst appears to be short-lived: The United States, Britain, and France had airstrikes on Damascus in Syria as early as Saturday morning. Now, as the geopolitical tensions in the United States and Russia intensify, the volatility of global financial markets seems likely to re-emerge and drag the Standard & Poor's/Australia Stock Exchange at the start of this week.

The AUD/USD week was strong. Local data showed that the Australian dollar exchange rate rose 1.15%, which is the first weekly increase since March 5. Most of the gains were due to high risk sentiment, with the S&P/Australia and Wall Street indexes higher last week. However, after the United States, Britain and France launched a military strike against Syria this week, the Australian dollar may be dragged down as investors shift to a more cautious attitude. Local data should also be a cause for concern. The minutes of the Reserve Bank of Australia will be announced on Tuesday and the March employment report released on Thursday. It is expected that an additional 20,000 jobs will be needed and the unemployment rate will drop from 5.6% to 5.5%, which may become a buoy for the Australian dollar in a turbulent environment from abroad.

Wall Street was mixed as large banks were higher than analysts' estimates of earnings, but share prices fell after JP Morgan CEO Jamie Dimon said the bank saw fierce competition and the loan portfolio did not grow. It is worth noting that the University of Michigan Miss Survey has caused the Citigroup economic surprise index to fall to its lowest level since October. However, growth is still higher than the trend.

To a large extent, thanks to the sharp decline in the fear of trade wars, all the major stock indexes in the world moved higher this week, minus Brazil's IBOVESPA.

Goldman Sachs this week said that the situation with the bulk of commodities has rarely become strong, which is consistent with the crude oil trading volume jumped to the highest level since 2014. Crude oil is at the center of the market's gains due to geopolitical risks.

OPEC's data shows that the output between members is the lowest in the year. At the same time, Venezuela's production has recently fallen to its lowest level since 1949. The intersection of these events made crude oil prices the highest level since July, and each CFTC hedge fund increased its net long position, setting a record high. good time!

Not to be outdone, since 1987, Aluminum has become the boss of Russia's Maucasian company Russian joint venture company, Rusal Aluminum, which was listed on the latest US sanctions list and effectively removed the world's largest non-Chinese aluminum supplier from the market. .

The flattening of the U.S. yield curve may be partly attributable to disappointing bank earnings. This week, the difference between the US 5-year and 30-year Treasury yields and the 2-year and 10-year Treasury yields was stable before the final economic recession began in late 2007. Although the early-stage yield and LIBOR are exciting and help profit margins, the long-term outlook is frustrating, although their balance sheets may be less healthy. At the same time, JP Morgan's preliminary report shows that they are doing their best

Mobile Apple, Saudi Aramco appears to be the world's leading company, net income in the first half of 2017 after involving financial data assessment by Bloomberg. Ami's profit in the first half of 2017 was US$3.38 billion, which was higher than Apple's US$28.9 billion and Samsung's US$1.4 billion. Currently, as Brent crude oil prices are higher than US$70/barrel, valuations are likely to continue to increase, which will help the Saudi Ministry of Finance to fund the ambitious social agenda of Crown Prince Mohammed Ben Salleman.

As Aramco's IPO is approaching, it is clear that Saudi Arabia encourages the expansion of the output restrictions of the Organization of Petroleum Exporting Countries. The effectiveness of this measure is very significant. Its motive is to push oil prices higher, so valuations not only help investors.

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