SVET Reports
Wednesday's Markets Update (July 19, 2023)
On Wednesday, building permits declined indicating weaker economy and NASDAQ ended up slightly in the red. Investors focused on corporate results. BTC continued its sideways trajectory.
Details: Building permits in the United States fell in June 2023, with the biggest decline in multi-segment approvals. Single-family authorizations increased, but permits were down in all regions except the Midwest.
Comments: The decline in building permits is a sign that the housing market may be cooling off even further. The drop in multi-segment approvals is particularly concerning, as this category includes commercial and industrial projects. A decline in these types of projects could have a negative impact on the economy. The increase in single-family authorizations is a positive sign, as this category includes homes. However, the increase was not enough to offset the decline in multi-segment approvals. The decline in permits in all regions except the Midwest is also concerning. This suggests that the housing market is cooling off nationwide.
Macroeconomics
China: The People's Bank of China (PBoC) maintained the one-year loan prime rate (LPR) at 3.55% and the five-year rate at 4.2%. The move comes after the GDP grew faster in Q2, but still lower than market forecasts. For the first half of the year, the economy expanded by 5.5%, higher than the government's target of around 5%.
Japan: Imports fell 12.9% in June, the steepest decline since September 2020. The decline was driven by a sharp drop in imports of mineral fuels, electrical machinery, and chemicals. Imports of manufactured goods and raw materials also fell, but purchases of others rose. Arrivals from China, the US, Taiwan, Malaysia, Russia, and Australia all fell in June. However, imports from Hong Kong, South Korea, India, and the EU rose. The decline in imports is likely due to a number of factors, including the weakening Japanese yen, the ongoing war in Ukraine, and rising global commodity prices.