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☆ JPMorgan's trading desk lays out 6 scenarios for tomorrow's inflation report, and how the stock market will react to each of them
▼ + stars: | 2024-05-14 | by ( Matthew Fox | ) www.businessinsider.com time to read: +5 min

The Wednesday release of the April CPI report has the potential to shake up the stock market. A cool inflation report would bode well for interest rate cuts from the Fed and vice versa if it's hotter than expected. JPMorgan laid out six scenarios for April CPI and how the stock market could react to each. The coming inflation report is set to market-shaking because it will help investors determine when the Federal Reserve might move forward with interest rate cuts. At the start of the year, the market was pricing in as many as seven interest rate cuts, but that has dwindled to just two rate cuts before year-end.

Persons: bode, —, Defensives outperforming, JPMorgan's Andrew Tyler, Tyler, Immaculate Disinflation Organizations: Fed, JPMorgan, Service, Federal Reserve, China PPI Locations: China

Nov 9 (Reuters) - A look at the day ahead in Asian markets from Jamie McGeever, financial markets columnist. Producer and consumer price inflation figures will be released, the highlights of a regional calendar that also includes Japanese bank lending, trade and current account figures, Indonesian retail sales, and Philippines GDP. Global yields are moving too - the 10-year Japanese Government Bond yield is back below 0.85%, having come within two basis points of 1% last week. The decline in U.S. bond yields is removing some of the dollar's shine, which in turn is allowing Asian currencies to fight back. Yen traders on Thursday are also eyeing Japanese bank lending figures for October and September's trade and current account report.

Persons: Jamie McGeever, Pan Gongsheng, Ping, Fed's Powell, Josie Kao Organizations: Treasury, People's Bank of China, Financial, Ping An Insurance Group, Reuters, Nissan, Honda, Sony, Group, China PPI, CPI, Thomson Locations: Asia, Philippines, Beijing, China's, Japan, Philippine, China

People walk past the headquarters of the People's Bank of China (PBOC), the central bank, in Beijing, China September 28, 2018. Going by Wall Street's decline on Thursday, sparked by a spike in long-dated U.S. bond yields following a weak 30-year auction, the mood will be one of caution, at best. Annual producer price inflation has been negative for a year, although consumer inflation only briefly dipped below zero in July. On Thursday the yield curve flattened the most in a single day since March, a 'bull' flattening led by heavy buying of long-dated bonds. Here are key developments that could provide more direction to markets on Friday:- China PPI and CPI inflation (September)- China trade (September)- Singapore policy decision and GDP (Q3)By Jamie McGeever; Editing by Josie KaoOur Standards: The Thomson Reuters Trust Principles.

Persons: Jason Lee, Jamie McGeever, Stocks, Josie Kao Organizations: People's Bank of China, REUTERS, PPI, CPI, September's PPI, Reuters, Treasury, China PPI, Thomson Locations: Beijing, China, U.S, Singapore, South Korea, India

☆ China PPI: Factory gate prices fall at fastest pace in 7 years
▼ + stars: | 2023-07-10 | by ( ) edition.cnn.com time to read: +2 min

China’s factory-gate prices fell at the fastest pace in over seven-and-a-half years in June, while consumer inflation was at its slowest since 2021, adding to the case for policymakers to use more stimulus to revive sluggish demand. That was the slowest pace since February 2021 and missed the 0.2% rise expected in the Reuters poll. Beijing has set a target for average consumer inflation in 2023 of about 3%. Prices rose 2% year-on-year in 2022. Core CPI, excluding the volatile prices of food and energy, rose 0.4% year-on-year, slowing from 0.6% in the previous month.

Persons: China’s, ”, “ Organizations: National Bureau of Statistics, Capital Economics, CPI Locations: China, Beijing

Any optimism could be punctured, however, by inflation data from China. April's CPI report showed inflation virtually evaporated, highlighting Beijing's challenge to stimulate enough economic activity and growth to kill the threat of deflation. The weak jobless claims figures torpedoed the dollar more broadly, sank Treasury yields, and cooled Fed rate hike expectations. Remarkably, the main measure of U.S. stock market volatility is at a pre-pandemic low, and implied global FX volatility is its lowest in over a year too. Here are three key developments that could provide more direction to markets on Friday:- China CPI inflation (May)- China PPI inflation (May)- South Korea current account (April)By Jamie McGeever; editing by Deepa BabingtonOur Standards: The Thomson Reuters Trust Principles.

Persons: Jamie McGeever, Deepa Babington Organizations: Nasdaq, Treasury, Wall, China PPI, Thomson, Reuters Locations: Asia, China, Japan, South Korea

There was more movement in currency markets, where the dollar rose across the board and the yen sank. Producer price inflation is expected to have fallen further in March, according to analysts' estimates of a year-on-year decline of 2.5%, which would be the fastest pace of deflation since June 2020. The annual rate of consumer price inflation is expected to remain unchanged at 1.0%, the slowest in a year, and the monthly rate is expected to rise to 0% from -0.5% in February. If these forecasts are broadly accurate, price pressures in China would appear to be extremely benign, giving the central bank room to loosen policy and stimulate the economy. In South Korea, the central bank looks to have ended its tightening cycle and will likely keep its main interest rate on hold at a 15-year high of 3.50% on Tuesday.

Chinese producer and consumer price inflation reports for November grab the limelight in Asia on Friday, with investors hoping to round off a bruising week on a positive note. Meanwhile, analysts expect the annual rate of consumer price inflation to slow to 1.6% from 2.1% in October, which would be the slowest rate of increase since March. China, the world's biggest energy consumer, is a major trade partner of oil-producing Gulf states and bilateral ties have expanded and strengthened in recent years. China's inflation figures follow a downside surprise in euro zone consumer price inflation, and economists expect upcoming U.S. producer and consumer price inflation numbers to have eased in November too. Three key developments that could provide more direction to markets on Friday:- China CPI (November)- China PPI (November)- South Korea current account (November)Reporting by Jamie McGeever in Orlando, Fla.; Editing by Josie KaoOur Standards: The Thomson Reuters Trust Principles.

"The latest round of China reopening hopes have helped drive us higher here again," he told clients. Any change to that scenario may be a positive impulse for cyclical stocks, it said, but it adds to the inflation headache for central banks. "The somewhat negative implication of stronger China growth is that it would likely add to global inflationary pressure. "We suspect Chinese re-opening (will) imply upside risks to commodity prices and global rates." But even with a G20 summit due next week, global cooperation has been in short supply in fractious 2022.

Nov 8 (Reuters) - A look at the day ahead in Asian markets from Jamie McGeever. There's a meltdown in the Wild West of crypto, equity markets lose their recently-found Mojo, volatility spikes higher and investors flock to U.S. Treasuries for safety and security. But leaving to one side the intraday chop and churn, particularly in crypto, investors may even feel a sense of comfort with what is a recognizable play-book. One example is the S&P 500 'SKEW' options index of implied volatility, which is at its lowest level since 2009. Investors are paying the least in 13 years to protect themselves against - an outsized fall on Wall Street versus an outsized rise.

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