iFund- Daily Market Commentary

2019-06-20 01:24
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19/6/2019

The Fed will keep interest rates unchanged, but the word “patience” is abandoned in the policy statement, implying the Fed may have the first rate cut within the last decade. The Fed’s dovish statement pushed the US stocks to rise for three consecutive times, approaching historical highs, and the US bond yields plummeted. US Trade Representative Wright Heze will meet with Chinese Vice Premier Liu He before the China-US summit.

      • The Dow Jones Industrial Average closed at 26,504.00 points, up 38.46 points or 0.15%. The Standard & Poor’s 500 Index closed at 2,926.46 points, up 8.71 points or 0.30%. The Nasdaq index closed at 7,987.32 points, up 33.44 points or 0.42%.
      • The Fed will keep interest rates unchanged, but the word “patience” is abandoned in the policy statement, and lowered the forecast for inflation this year. It implies that the Fed is preparing to cut interest rates for the first time within the last decade.
      • US Trade Representative Wright Heze said that he will negotiate with Chinese Vice Premier Liu He to prepare for the summit meeting between the two countries’ leaders in this month. Wright Heze said it is still uncertain that whether formal trade negotiations will resume.

     

      • The UK’s FTSE 100 index closed at 7,403.54 points, down 39.50 points or 0.53%. The Frankfurt DAX index closed at 12,308.53 points, down 23.22 points or 0.19%. The French CAC40 index closed at 5,518.45 points, up 8.72 points or 0.16%.
      • According to a Bloomberg survey, the Bank of England is expected to keep interest rates unchanged on Thursday. Although the bank warned that it will have to raise interest rates in the future, political turmoil, Brexit uncertainty, weak economic data, provides a reason for the central bank to stand still.
      • Rehn, a central bank official who is considered to be the popular candidate for the next ECB president, warned that continued trade tensions have evolved into a global currency war, and the central bank is ready to take action and adjust all its tools, including interest rate cuts and restarting quantitative easing policy.
      • Japan’s Nikkei 225 index closed at 21,333.87 points, up 361.16 points or 1.72%. The yen closed at 108.400 against the US dollar, down 0.101%.
      • Japan’s Ministry of Finance announced that, without seasonal adjustment, Japan recorded a trade deficit of 9671 billion yen in May, increased by 67.5% year-on-year, less than the market expectations  of 1.2 trillion yen trade deficit.
      • The Shanghai Composite Index closed at 2,917.80 points, up 27.65 points or 0.96%. The Shanghai and Shenzhen 300 Index closed at 3,715.94 points, up 48.32 points or 1.32%. The RMB closed at 6.094 against 1 US dollar, up 0.324%.
      • It is reported that at least five of the US companies’ CEO, including Dow, UPS, Pfizer and Honeywell, will meet with Chinese Premier Li Keqiang this week.
      • According to a World Bank report, China’s “One Belt, One Road” infrastructure plan can promote economic development and reduce poverty in dozens of developing countries. However, it also points out that the project has major risks because of the lack of transparency of the plan.









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