China trade sinks further in July

US shares finished higher on Monday, rebounding from their worst weekly decline since March as investors prepared for more quarterly earnings and monthly inflation updates later in the week.  The Dow Jones soared 1.2%, the S&P 500 added 0.9%, and the Nasdaq gained 0.6%.  Financials and Communication Services were among the best-performing sectors, while energy shares pulled back as crude oil futures fell nearly 1%.  Meantime, European equity markets held mostly steady on Monday with the Euro Stoxx 50 Index advancing by 0.1%, to 4,337 points. 

Summary for 08.08.2023 

• Most Asian equities moved little on Tuesday as markets hunkered down ahead of more cues from key inflation data and a slew of major earnings this week, while Chinese shares were hit by a fresh wave of selling in the property sector.  Softer-than-expected Chinese trade data also dampened sentiment towards the region, as both Chinese imports and exports sank at their fastest pace since the 2020 Covid-19 pandemic. 
• European and US shares are seen set for a muted start as traders await key US inflation data due later this week. 
• Oil prices were little changed this morning after China reported a sharp monthly drop in imports in July, which reinforced demand fears, though that was offset by supply concerns from Saudi Arabian and Russian output cuts. 

• China’s trade tumbled in July, as both exports and imports posted double-digit declines due to deteriorating foreign and domestic demand.  Sales slumped by 14.5% year over year, while purchases plunged 12.4%, each coming worse than market estimates. 
• Moody’s Investors Service lowered the credit ratings for 10 small and midsize US banks and said it may downgrade major lenders including US Bancorp, Bank of New York Mellon, State Street, and Truist Financial as part of a sweeping look at mounting pressures on the industry.  Higher funding costs, potential regulatory capital weaknesses, and rising risks tied to commercial real estate loans amid weakening demand for office space are among the strains prompting the review. 
• Bayer this morning reported a net loss of €1.89 billion for the second quarter, weighed down by €2.3 billion in impairment charges.   
• Tesla CFO Zachary Kirkhorn stepped down after 13 years at the company, a surprise shakeup that raises new questions about succession in the top ranks of Eon Musk’s company.  Kirkhorn, one of just four executive officers and a prominent voice for the company with shareholders, resigned from his duties on 4^th August. 
• Berkshire Hathaway shares rose more than 3% to record highs on Monday after Warren Buffett’s conglomerate reported strong quarterly results. 

• Tyson Foods shares dropped 4.4% yesterday after the biggest US meatpacker reported disappointing quarterly results.  In a statement early Monday, the company said current market dynamics remain challenging and it would close four chicken plants.