Fixed Income Market Overview
U.S. Treasury yields fell slightly on Wednesday as investors reacted to the latest inflation data, which aligned with expectations, suggesting the Federal Reserve may cut interest rates in September. The 10-year Treasury yield decreased by 3.2 basis points to 3.822%, while the 2-year yield slipped to 3.939%. The July consumer price index (CPI) showed a 0.2% monthly rise, with a 12-month inflation rate of 2.9%, slightly below forecasts. Core CPI also met expectations. The data has strengthened the likelihood of a September rate cut, with markets split on the size of the reduction.
US junk debt investors cautious of leveraged loans as economy slows.
Chinese tech giant Tencent’s quarterly profit jumps 82% as key gaming unit accelerates.
Intel sells stake in UK chip designer Arm amid companywide restructuring and cost.
Oil steady after Biden says Iran could refrain from Israel attack if cease-fire clinched.
Mars strikes $36bn deal to buy Pringles maker Kellanova.
Major Indicies
| Symbol | Price | Change | %Change |
|---|---|---|---|
| DJIA | 40,008.39 | 242.75 | 0.61%↑ |
| NASDAQ | 19,022.68 | 16.25 | 0.08%↑ |
| S&P 500 | 5,455.21 | 20.78 | 0.38%↑ |
| FTSE 100 | 8,281.05 | 45.82 | 0.55%↑ |
| SX5E | 4,727.60 | 32.68 | 0.69%↑ |
| NIKKEI | 36,442.43 | 209.92 | 0.57%↑ |
| HSI | 17,113.36 | -60.70 | -0.35% |
| VIX | 16.19 | -1.93 | -10.65%↓ |
Bonds
| Name | Yeild | CHG |
|---|---|---|
| US 10-YR | 3.83% | -0.007 |
| US 30-YR | 4.12% | -0.033 |
| US 5-YR | 3.67% | 0.008 |
| JPN 10-YR | 0.82% | -0.025 |
| UK 10-YR | 3.61% | -0.063 |
Futures & Commodities
| Name | Last | Change | %Change |
|---|---|---|---|
| WTI CRUDE | 76.98 | -1.37 | -1.74%↓ |
| NAT GAS | 2.21 | 0.07 | 3.30%↑ |
| GOLD | 2,447.85 | -17.31 | -0.70%↓ |
| SILVER | 27.56 | -0.28 | -1.01%↓ |
| COPPER | 4.04 | -0.01 | -0.28%↓ |
Equity Market Overview
AstraZeneca
AstraZeneca’s £450 million investment in a vaccine manufacturing site in Merseyside is at risk after the Treasury proposed cutting state aid from £65 million to £40 million, raising concerns that the project could be relocated to France. Announced in March, the investment aims to expand the Speke facility for sustainable vaccine development. While AstraZeneca’s CEO Pascal Soriot has expressed readiness to proceed, the reduced funding threatens the project’s future. The existing site currently produces the FluMist nasal flu vaccine, and the new investment was expected to enhance AstraZeneca’s vaccine capabilities post-Covid-19.
UBS
UBS reported a $1.1 billion net profit for the second quarter, surpassing expectations, driven by a 38% revenue boost in its investment banking division and progress in integrating Credit Suisse. The bank’s revenues rose 25% year-on-year to $11.9 billion, slightly above forecasts. CEO Sergio Ermotti emphasized UBS’s strong positioning to achieve financial targets as it moves forward with the integration. While the wealth management division saw steady asset inflows of $27 billion, the bank experienced a decline in loans due to reduced risk appetite and differing pricing levels with Credit Suisse. UBS also achieved $900 million in cost savings but remains in a dispute with Swiss authorities over increased capital requirements following its merger with Credit Suisse in May.
