European equities fell on Monday, with the Euro Stoxx 50 Index down 0.7%, following strong gains in the previous week, amid concerns about the future direction of interest rates and the strength of China’s recovery.  Losses were higher in the chemicals sector followed by construction and material shares while banking shares ended just above the flatline.  Meantime, US markets were closed on Monday for the Juneteenth holiday. 

Summary for 20.16.2023 

  • Asian equity markets mostly fell on Tuesday as investors worried China’s latest rate cut was not enough to boost confidence in the weakening economy and awaited a wider stimulus package by Beijing.  In a highly anticipated move, the People’s Bank of China lowered both its one-year and five-year loan prime rates by 10 basis points to 3.55% and 4.2%, respectively, to prop up growth.  Shares in Japan, South Korea, Hong Kong and mainland China declined, while Australian shares gained for the seventh straight session.  
  • European equity futures were little changed this morning while their US counterparts slipped to start a holiday-shortened week. 
  • Oil prices retreated this morning as investors weighed increasing pessimism over China’s economic prospects this year and caution over the path of US monetary policy.  Both Brent and West Texas Intermediate crude retreated on Monday after concerns over China largely offset signs of tighter supply from Saudi Arabian production cuts and dropping US oil rig numbers.  
  • China and the United States agreed on Monday to stabilise their intense rivalry, so it does not veer into conflict but failed to produce any major breakthrough during a rare visit to Beijing by US Secretary of State Antony Blinken.  
  • The Reserve Bank of Australia unexpectedly raised the cash rate by 25bps to 4.1% earlier today after delivering a rate hike by the same margin in May while keeping the door open for further tightening as inflation remained persistently high while wage growth picked up. 
  • Berkshire Hathaway on Monday said its wholly owned subsidiary National Indemnity Company has increased its stake in five Japanese trading firms to average more than 8.5%.  The companies involved are Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo.  The aggregate value of these interests surpasses that of Berkshire-held shares in any country outside of the US, the firm said. 
  • On Monday, Airbus announced the biggest plane deal in history on the opening day of the Paris Airshow, with an order for 500 narrowbody jets from Indian budget carrier IndiGo.  The multibillion-dollar value is the largest by the number of aircraft, eclipsing Air India’s provisional purchase of 470 jets earlier this year as India’s two largest carriers plan for a sharp expansion in regional travel demand.  The aircraft will be delivered between 2030 and 2035.