SMM: at a hearing of the US House of Representatives Financial Services Committee on Tuesday night, Federal Reserve Chairman Colin Powell reaffirmed the Fed's commitment to help the economy through the novel coronavirus epidemic crisis and outlined the work the Fed has done so far.
"We remain committed to using our tools to do what we can, no matter how long it takes to ensure that the recovery is as strong as possible and to limit the lasting damage to the economy." Powell said in his testimony.
While Powell said easing would continue if necessary, he added that the economic situation had improved.
In testimony to Congress, US Treasury Secretary Mnuchin said that he would continue to work with Congress on the fourth phase of the relief package, saying that a targeted package was still needed.
In addition, Chicago Federal Reserve Chairman Evans said that if the US Congress fails to pass the fiscal stimulus package, the US economy will be at risk of recession.
International gold prices fell slightly on Tuesday. As of the close of the day, COMEX gold December contract closed at US $1907.6 per ounce, down 0.16% X Comex silver futures contract closed at US $24.523 per ounce, an increase of 0.56%.
The three major indexes of U. S. stocks closed higher on Tuesday, recovering from the previous day's sell-off. By the close of the day, the Dow was up 0.52% at 27288.18, the Nasdaq was up 1.71% at 10963.64, and the S & P 500 was up 1.05% at 3315.57.
A-share: the upward trend remains unchanged, and the short-term high probability continues to oscillate to the bottom.
On Tuesday, despite the hot subscription of the first batch of 4 Kechuang 50ETF, A shares struggled to recover after a slight low opening amid a general slump in the overnight outer disk market. Although there was a brief rise in the afternoon, it then fell back quickly. As of the close, the Shanghai Composite Index fell 1.29% to close at 3274.30 points, the Shenzhen Composite Index fell 0.96% to close at 13023.43 points, and the gem Index fell 0.53% to 2555.54 points. Northbound funds sold a net of 2.002 billion yuan.
In terms of stock index futures, the three main contracts closed down across the board. IF2010, the main contract of CSI 300 stock index futures, fell 60.0 points, or 1.28%, to 4617.8 points; IH2010, the main contract of Shanghai 50 stock index futures, fell 49.6 points, or 1.50%, to 3256.0 points; and IC2010, the main contract of CSI 500 stock index futures, fell 77.8 points, or 1.22%, to 6292.2 points.
However, it is generally believed that in addition to the shortage of liquidity in the United States, there are also reasons for the decline of A-shares, which is different from that in the first half of the year.
According to Erroxi, a macro strategy researcher in Haitong Futures, the core contradiction of the market in the past two months is the marginal weakening of the driving force of economic recovery and the marginal weakening of stimulus policies, which caused the destruction of the collective trend of risky assets in the first half of the year.
In addition, there has also been a marginal tightening of the domestic monetary and financial environment recently. for example, deposits in non-bank financial institutions fell sharply in August, in sharp contrast to July. Galaxy Futures Macro researchers believe that this has also affected the performance of A shares to a certain extent.
In fact, in Iroxi's view, there are many leading factors affecting the A-share market at present. For example, the current valuation level of the A-share market is relatively high compared with that at the beginning of the year; domestic liquidity is restricted by monetary policy and shows a tightening trend; and the role of external constraints cannot be ignored. the enlarged trade surplus has brought about a relatively obvious appreciation of the RMB, but due to the impact of Sino-US trade frictions, domestic industrial products and agricultural products are distorted, which is not good for the stock market.
"nevertheless, in the recent more complex environment, the domestic market trend is still relatively strong. We believe that the stage of pushing the market higher characterized by the loose monetary and financial environment will fade out, but the institutional opportunities brought about by the reform will still bring a structural market to the market. " Galaxy futures macro researcher said.
It is suggested that we should focus on two aspects of reform: first, the opportunities for financial supply-side reform under the gradual opening of financial services and capital markets to the outside world. Compared with large overseas investment banks, China's securities companies have the problems of small scale, single business and low profitability. Without financial supply-side reform, it is difficult to cope with the international competition after the opening of the capital market. Therefore, through the financial supply-side reform, It is urgent to expand and strengthen domestic securities firms. The second is the structural opportunity under the double cycle, which is put forward relative to the previous' big in and out', so the key to the double cycle is to solve the problems of resource security and market. There will be no less structural opportunities for industries and themes such as food security, energy security, resource security and expanding domestic demand. " Galaxy futures macro researcher said.
At present, domestic economic indicators continue to improve, superimposed RMB is expected to maintain the trend of appreciation, Green Dahua Futures Financial Futures Chief researcher Zhao Xiaoxia believes that these factors have a certain support for A shares.
Erroxi said that in the short and medium term, considering that the international trading environment has not fully recovered, the A-share market is subject to multiple negative factors and is likely to maintain an oscillating pattern. However, the recent market adjustment is more the adjustment of the internal structure of the market, after the overall valuation is adjusted to a reasonable level, the index will have more upward space.
As for derivatives, the macro researcher of Galaxy Futures said that since there are structural opportunities in the market, the use of financial derivatives tools such as stock index futures and options to formulate corresponding investment strategies can theoretically better grasp structural opportunities and reduce systemic risks.
Precious Metals: inflation will be the focus of attention in the future
As for the sharp decline in precious metal prices on Monday night, according to Wan Yijing, a precious metals researcher in Galaxy Futures, it was mainly affected by the rebound of the epidemic in Europe. It is understood that apart from the United Kingdom, the epidemic situation in other European countries has further intensified, and there is the possibility of a second outbreak. This has led governments to consider re-closing cities, worsening market sentiment, raising concerns about future European economic repair, and ECB President Christine Lagarde said the strength of the recovery is still very uncertain. European stock markets tumbled on Monday and the euro fell sharply against the dollar, hitting dollar-denominated precious metals prices.
Wan Yijing said concerns about the European economy would also raise concerns about future demand, with inflation expectations falling before countries adopted further easing and stimulus policies, which also had an impact on precious metals prices.
It is understood that after the sharp rise and fall from late July to early August, gold and silver have been trading for more than a month. And at present, the prices of most bulk industrial products are high and have begun to fall one after another, and the overall market atmosphere is empty. Therefore, in the view of Xue Na, a precious metals analyst at South China Futures, a sharp decline in gold and silver in the short term is a high probability event.
Given that most industrial product prices have fluctuated or fallen, and stock markets are also worried about renewed outbreaks in the US and Europe, Xue Na said that the overall investment sentiment in the market has been pessimistic recently, which is bad for gold and silver prices.
In case Jing's view, the expectation of rising inflation is not short-term, the general view of the market is that after the medium-and long-term economic repair, inflation is more likely to rise. However, given that much of the economic repair has been spurred by government policies, the chances of precious metals coming under pressure will continue to increase in the short term in the absence of further action in the event of easing below market expectations.
Under such circumstances, Xue Na suggested that we need to pay attention to US fiscal and monetary policy in the future, and that if a new round of rescue plan is launched, or if the Federal Reserve increases its easing measures, the expectation of economic recovery will be strengthened, and gold and silver prices will most likely continue to rise.
She said she was more optimistic about silver. This is because silver prices are volatile and silver demand is expected to recover as the economy recovers. In fact, gold and silver have been falling since peaking in mid-March, during which time silver has risen more than gold, mainly because silver prices are relatively low, so there is more room to rise.
However, in case Jing reminds that, compared with gold, the commodity attribute and speculative attribute of silver are stronger, in such a case, not only the commodity attribute may drag down the price of silver, but its high speculation will also cause it to fall back. The decline will be larger than that of gold.
Crude oil: it may take longer for prices to recover
Referring to the reasons for the recent sharp fluctuations in crude oil prices, in the view of Gu Jintao, head of the International Futures Research Department of the Bank of China, it is mainly affected by the fear of a second outbreak of the global novel coronavirus epidemic, market confidence has weakened, and the demand caused by the epidemic is still weak.
Given the recent slowdown in fundamental repair in the oil market, the market is still waiting for positive news such as vaccines to boost, with direct downstream such as fuel oil being hit harder. The holidays are coming, and there are many variables in the outer disk. Li Wanying, a senior energy analyst at the East China Sea Research Institute, suggested that investors in the Nenghua sector should be cautious and pay close attention to the development of the epidemic in the United States and Europe and the closure of cities. If the epidemic is not effectively controlled, there will be great upward pressure on crude oil, and it is expected that it will take more time for prices to recover.
Gu Jintao believes that if there is no large-scale second outbreak of the epidemic before the end of the year, crude oil prices may rebound significantly. On the supply side, the implementation rate of OPEC production reduction is very high, and recent news shows that there is a high probability that OPEC will continue to strictly implement the production reduction agreement and compensate for the production reduction as soon as possible. In the United States, taking into account the recent decline in the number of crude oil drilling, according to Baker Hughes, the number of wells drilled online in the week ended September 18 was 179, down one from the previous week and 540 from the same period last year. It is difficult to have a big rebound in the short term. As a result, crude oil production in the United States will remain low.
As for demand, although demand in various countries is gradually recovering, there is the possibility of a second outbreak. In particular, the current situation in Europe, the United States and India is not very optimistic. Gu Jintao said that although the fundamentals of crude oil are preferred in the absence of a large-scale second outbreak of the epidemic, considering that the recovery of demand, especially aviation demand, will take a long time, even if the impact of the epidemic will rapidly weaken after the emergence of large-scale clinical vaccines, the room for crude oil prices to rise may be limited.