[Market Morning] Biden Ends His Trip to the Middle East Without Finalizing the Increase in Oil Production; US Retail Sales Continue to Boom, and Fed Officials Put Out Another 100 Basis Points of Interest Rate Hike Expectations

Last Friday, spot gold fluctuated widely, fluctuated violently during the session, and even fell below the US$1,700 mark several times, and finally successfully recovered the mark, closing down 0.16% at US$1,706.78 per ounce; spot silver once dropped before the European market. It reached $18.17, then rebounded all the way, and finally closed up 1.66% at $18.69 per ounce.

Comment: Spot gold fell by more than 2% last week, and the price of gold fell for the fifth consecutive week. It refreshed the intraday low since the week of August 13, 2021 to $1697.53. The year-on-year increase in U.S. inflation hit a 40-year high of 9.1%. Expectations of a faster rate hike by the Federal Reserve boosted the dollar significantly, weighing on the overall trend of gold prices last week.

Suggestion: go short at 1708.90 of spot gold, target point at 1700.00

The US dollar index fluctuated downward, held the 108 mark in a thrilling manner, and finally closed down 0.598% at 108.01; the 10-year US bond yield fluctuated within a narrow range and finally closed at 2.928%.

Comment: Last week, the U.S. dollar index rose for the third consecutive week, breaking through the two integer levels of 108 and 109 successively, refreshing the high since mid-September 2002 to 109.303. Because the overall U.S. inflation exceeded 9, it provided a new opportunity for the Federal Reserve to raise interest rates sharply. basis. At a time when the risk of a global economic recession has intensified, the safe-haven function of the U.S. dollar has also been demonstrated.

Suggestion: short position of EUR/USD 1.00910, target point 1.00000.

In terms of crude oil, the two oil prices fluctuated upwards. WTI crude oil tried to break through US$99, but was unsuccessful, and finally closed up 0.88% at US$97.41 per barrel; Brent crude oil closed up 1.35% at US$102.44 per barrel.

Comment: Oil prices continued to fluctuate down last week. The June CPI data released by the United States unexpectedly exceeded expectations by a large margin, which made the market's expectations for the Fed to raise interest rates sharply, which is not conducive to oil prices. In addition, last week, US President Biden opened a trip to the Middle East, hoping to urge Middle Eastern countries to increase production, which also put heavy pressure on oil prices.

Suggestion: go short at 93.620 of US crude oil, and the target point is 90.000.

In terms of US stocks, the three major stock indexes closed up, the Dow rose more than 655 points, the Nasdaq rose 1.79%, the US retail sales data in June was better than expected, traders reduced their bets on the Fed raising interest rates, and many bank stocks rose sharply. Citi rose more than 13%, State Street rose 8%, and Bank of America rose 6.8%.

Comment: On Friday, the three major U.S. stock indexes recorded their largest daily gains in three weeks, and they still fell all week; the financial sector rose 3.5%, leading the gains on Friday, and Citigroup, which had better-than-expected results in the second quarter, rose more than 13%; Google fell more than 6% throughout the week %, the sector led the decline in U.S. stocks.

Suggestion: go short at 12023.150 of the Nasdaq index, target point at 11690.610

US President Biden: Expect Saudi Arabia to take further steps on energy

U.S. President Joe Biden has said some important deals have been reached with Saudi Arabia and expects that we will see further steps on the energy front in the coming weeks. The Saudi foreign minister responded that oil production was not discussed at the Saudi summit in Jeddah, and that OPEC+ will continue to assess the oil market to ensure sufficient supply, and if we see oil shortages, there will be more production, and he also said, The 13 million barrels per day the crown prince mentioned in his meeting with Biden was Saudi Arabia's oil production capacity.

U.S. retail sales rose 1% m/m in June, beating market expectations

US retail sales in June recorded a monthly rate of 1%, expected 0.8%, the previous value of -0.30%. The data eased fears of a recession, raising the odds that the Federal Reserve will hike rates aggressively this month. Fed's Daly said retail sales data showed people were still spending.

The U.S. University of Michigan consumer confidence index in July recorded a preliminary value of 51.1, slightly higher than market expectations

The U.S. University of Michigan consumer confidence index in July recorded a preliminary reading of 51.1, compared with an expected 49.9 and the previous value of 50. Consumer confidence is relatively stable and remains near record lows, said Joanne Hsu, director of consumer surveys at the University of Michigan. The current assessment of personal finances continues to deteriorate, reaching the lowest level since 2011.