German business confidence deteriorated to the worst level since the early months of the pandemic on growing concerns that record inflation and limited energy supplies from Russia will throw Europe’s biggest economy into a downturn. A gauge of expectations released Monday by the Munich-based Ifo Institute fell to 80.3 in July from 85.8 in June. Analysts had predicted a drop to 83.0. An index of current conditions also dropped. “Germany is on the brink of a recession,” Ifo President Clemens Fuest said. “High energy prices and the threat of gas shortages are weighing on the economy. Companies are expecting significantly worse business activity in the coming months.”

함의: 독일 기업 신뢰 지수는 대확산 초기 수준까지 수축되며 경기침체를 눈 앞에 두고 있다는 우려를 키움.

Speculators aren’t buying the latest rally in longer-dated bonds, even amid the threat of recession. Net-short non-commercial positions in so-called ultra-long Treasury futures -- bonds with at least 25 years to maturity -- hit a two-year high last week, according to data from the Commodity Futures Trading Commission. That’s even as 30-year US yields dropped back below the 3% level from a mid-June high of over 3.4%. Futures positioning aren’t always a clean read -- they are often are used to hedge cash bond positions -- but the leveraged fund data also show a similar bearishness.

함의: 선물 포지션을 명확히 분석하기 어려우나, 경기침체 우려로 30년물 국채금리가 하락하는 동안에도 투기적 수요는 장기채권 매도(Short) 포지션을 2년래 최대치까지 늘렸음.

Earnings estimates are dropping and that’s a good thing for stocks, because it reflects a more realistic outlook on corporate profits, removing some of the downside. But they need to fall further before they align with gloomier economic views. Full-year annual growth estimates for US stocks have dipped to 10.1% from 10.7% a month ago but remain about 1.2 percentage points higher than at the start of the year, per Bloomberg Intelligence data. That’s as economists have lowered their forecasts for GDP growth to 2% this year from 3.9% and stocks plunged into a bear market. The disconnect has upped pressure on strategists to temper their views.

함의: 기업 성장률 전망치가 하향되었지만 여전히 연 초 대비 +1.2%p 높은 수준, 다만 경제성장률 전망치가 연 초 3.9%에서 2.0%로 낮춰진걸 감안하면 추정치는 여전히 현실과 괴리가 크다고 봄.

Earnings Estimates Are Slowly Coming Back to Earth.

Russia is further curbing natural gas flows on the Nord Stream pipeline  just days after bringing the link back from maintenance, escalating European concerns over a supply crunch this winter. Gazprom PJSC will cut flows via the link to Germany to about 20% of its capacity from 7 a.m. Moscow time on Wednesday, the Russian gas giant said in a statement. One more gas turbine, crucial for the supply, is due for maintenance and will be taken out of service, according to the company. Gas had been flowing through the link at about 40% of capacity since it returned from 10 days of maintenance on July 21. That’s about the same level as before the works. 

함의: Red mafia 자식들...

"Happiness is when what you think, what you say, and what you do are in harmony."

- Mohandas Karamchand Gandhi

Nancy Pelosi hasn't made a final decision about stopping in Taiwan during her trip to Asia, but her staff and security officials haven't ruled it out, a person familiar said. If she does visit, it'd be within days of an expected phone call between Joe Biden and Xi Jinping. The US president said he expects to speak with his Chinese counterpart this week.

함의: 대만 방문을 명확히 하지 않았지만 해당 일정을 포함해 준비 중임.

China’s economic slowdown is spilling over to major exporting nations in Europe and East Asia through falling demand for manufactured goods, causing Germany and South Korea to post rare deficits with the world’s second-largest economy. Elevated global commodity prices meant that China’s official import growth of 1% in June from a year earlier hid a worse result for manufactured goods. Imports of hi-tech products and mechanical and electrical goods fell about 8% last month, according to recently released Chinese customs data. There doesn’t seem to have been an improvement this month, with South Korea’s exports to China falling 2.5% in the first 20 days of July.

함의: 중국 경기 둔화로 전자제품 및 기계에 대한 수입이 8% 하락, 독일과 한국이 이례적 무역 적자를 기록허고 있음.

Coinbase Global Inc. is facing a US probe into whether it improperly let Americans trade digital assets that should have been registered as securities, according to three people familiar with the matter. The US Securities and Exchange Commission’s scrutiny of Coinbase has increased since the platform expanded the number of tokens in which it offers trading, said two of the people, who asked not to be named because the inquiry hasn’t been disclosed publicly. The probe by the SEC’s enforcement unit predates the agency’s investigation into an alleged insider trading scheme that led the regulator last week to sue a former Coinbase manager and two other people. As the largest US trading platform, Coinbase lets Americans trade more than 150 tokens. If those products were deemed securities, the firm could need to register as an exchange with the SEC. Coinbase has repeatedly sparred with the agency over how it oversees the industry, and the firm last week called on the SEC to propose clearer rules. Meanwhile, after taking a relatively cautious approach for years, Coinbase has boosted its token offerings. 

함의: 코인베이스에 거래 된 자산 중 일부가 증권의 성격을 가져 증권거래위원회에 신고 및 등록되었어야 함에도 그렇게 하지 않고 거래하게 했다는 명목으로 조사를 받게 될 것으로 보임.

Oil advanced for a second session as signs of a tight physical crude market offset concerns about an economic slowdown. West Texas Intermediate futures rose to trade near $98 a barrel amid a broader rally in commodities after gaining 2.1% on Monday. Time spreads are indicating scarce supply, and Morgan Stanley said the market remains tight, although the investment bank trimmed its crude oil price forecasts this year and into 2023 citing reduced demand projections. “There are clear supply issues facing the market, which will keep the oil balance tight for the remainder of the year,” said Warren Patterson, head of commodities strategy at ING Groep NV in Singapore. Investors are “dealing with plenty of uncertainty and trying to find direction.”

함의: 수요 둔화 우려로 많은 전문가들이 예상치를 조정했지만, 부족한 공급 이슈가 연말까지 수급 불균형을 만들 것으로 예상되며 원유는 이틀째 상승함.

A Regime-Shift In the Fed’s Reaction Function. 75-basis-point rate hike at the Fed’s meeting this week is more or less a done deal. The outlook from then on is harder to predict. With the economy cooling rapidly, traders expect the Fed to pause its rate-hike cycle after this year. Bloomberg Economics believe market participants have underpriced the amount of tightening needed to tame inflation, the Fed’s current priority. Bloomberg Economics expects a steeper and higher path for the fed funds rate than what’s currently priced in the market. We believe the fed funds rate will reach 3.75%-4.0% by the end of the year, compared to market expectations of 3.25%-3.5%. Most traders expect the Fed to keep rates at that level until mid-2023. We expect the central bank to continue hiking until the upper end of the target-rate range reaches 5% in mid-2023 -- up from 4% in our previous forecast.

함의: 시장은 인플레이션 통제를 위한 중앙은행의 행동을 과소평가하고 있으며, 연말까지 3.75%~4.0%, 그리고 내년 중반까지 5%까지(이전 예상은 4%) 금리인상을 멈추지 않을 것으로 봄.

The Federal Reserve’s interest-rate hikes are wearing out their welcome in bond markets, with a measure of the yield curve that Chair Jerome Powell has highlighted as a recession indicator sending out a warning message. The difference between rates on where three-month bills are now and where they will be in 18 months has tumbled about 95 basis points in July, the biggest monthly decline in data starting in 1996. A vast swathe of the US yield curve inverted in recent weeks as recession fears spurred investors to pile into longer maturities. That spread peaked soon after his comments, and is now dropping fast enough to fall below zero at some stage in the next month. “Rates markets pricing in 2023 Fed rate cuts imply the market is expecting the Fed to pivot on rising recession risks,” said Prashant Newnaha, a strategist at TD Securities in Singapore.

함의: 채권 시장 참여자들은 중앙은행의 정책 방향에 정면으로 반대하고 있으며, 그 결과로 1996년 데이터 산정 이후 월간 기준 최대 스프레드(3개월물의 현재와 18개월 뒤 차이) 낙폭을 만들면서 역전도 가능한 기세로 움직이고 있음.