Market Commentary: Thursday 9th May

Asian bonds fell overnight, mirroring the selling of Treasuries in the earlier US session. 10y benchmark yields in Australia, New Zealand and Japan all increased. USDJPY has been steadily gaining since the (still unconfirmed) government intervention a couple of weeks ago and currently trades at 155.59. Investors are essentially saying that the interest rate differential does not support the Yen at that lower level. Masato Kanda, Japan's top currency official has said the country would be ready to take appropriate action when necessary, but investors clearly do not feel that there will be significant hiking in Japan.

Chinese stocks had a good session overnight - CSI 300 increased to a 29-week high of 3668.00. Over the past 4 weeks, the CSI 300 Index gained 4.64%. This seems to be on positive sentiment and hopes are growing that a Chinese recovery is gathering momentum after both exports and imports beat expectations in April. Other analysts remain cautious touting tactical recovery from oversold positions as a key reason for this 'bounce' in Chinese equities.

In the US the picture is a little less rosy, ARM reported lacklustre revenue projections yesterday. These disappointing figures made investors nervous that tech companies are slowing down spending on AI software, ARM dropped around 10% in afterhours trading. Intel shares also fell after their license to sell chips to Huawei was revoked. Airbnb shares also fell following signs of slowing growth.

In commodities, the Biden administration has officially raised the cap on the price that they are willing to pay to refill the country's emergency oil reserves - to $79.99 a barrel (previous was informally $79). Oil reserves in the states are currently near a 40-year low. Front month crude closed at 79.39 yesterday.

On the data front today we have the Bank of England interest rate decision where rates will likely be held at 5.25, at midday. We also have US initial jobless claims at 1:30.

**For professional investors only** Any opinions, news, research, analyses, prices, or other information contained in this blog is provided as general market commentary and does not constitute (and should not be construed as containing) investment advice or an investment recommendation, or an offer of, or solicitation for, a transaction in any financial instrument. Some of this information may have been provided by third-party sources and, although believed to be reliable, it has not been independently verified and its accuracy or completeness cannot be guaranteed. No representation or warranty, expressed or implied, is made or given by or on behalf of iSAM Securities or its directors or any other person as to the accuracy, completeness or fairness of the information or opinions contained in this blog, and no responsibility or liability is accepted for any such information. As a result, any person acting on any information does so entirely at their own risk. iSAM Securities will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.