Core inflation in the United States has cooled, and the French stock market has been dragged down by the election

In the Asia-Pacific market, Japan's Nikkei 225 index rose 2.6%, mainly due to relative gains from finance, health care, communication services, and real estate; India's NIFTY50 index rose 2.2%; China A-shares and Hong Kong stocks closed lower, with the CSI 300 Index down 0.97% and the Hong Kong Hang Seng Index down 1.72%. In U.S. stocks, the S&P 500 fell 0.08% and the Nasdaq rose 0.24%, hitting a record high for the week. In Europe, Germany's DAX rose 0.40%; France's CAC 40 index fell 1.96%, or affected by the election; Britain's FTSE 100 index fell 0.89%; The European ST0XX600 index fell by 0.39%, with relative gains in energy, information technology, health care, real estate, and finance. In the bond market, the inversion of US Treasury yields slowed down, with the yield on 10-year Treasury bonds rising 16bp to 4.40%, and 20-year and 30-year yields rising by about 16bp; Most European government bond yields rose, Italy, Spain and France rose by more than 10bp, Sweden and Switzerland fell, and the UK government bond yield was 4.17%, the highest among major European countries. In terms of commodities, gold prices and crude oil prices fell.

Inflationary pressures continued to ease, with the core PCE price index at 2.6% year-on-year and the core PCE price index at 0.1% month-on-month in May, in line with expectations and slower than the previous value. In Europe, the Eurozone consumer confidence index and service sector confidence index in June were unchanged from the May value, and the industrial confidence index was lower than the May value. In Japan, industrial output in May was 2.8% month-on-month, higher than the expected 2.0% and the previous value of -0.9%; Industrial added value was 0.3% year-on-year, higher than the expected 0.0% and the previous value of -1.8%; The CPI was 2.3% year-on-year, in line with expectations, higher than the previous value of 2.2%, except for fresh food CPI of 2.1% year-on-year, higher than the expected 2.0%. Japan's economic outlook indicators and inflation indicators may support the Bank of Japan in raising its interest rates.

Recent Views of QDII Funds:

Sino Oil & Gas Energy Fund:

IN TERMS OF DATA, THE LATEST DATA FROM RYSTAD ENERGY SHOWS THAT OPEC'S CRUDE OIL PRODUCTION IN MAY 2024 WAS 26.883 MILLION BARRELS PER DAY, A DECREASE FROM 28.026 MILLION BARRELS PER DAY IN DECEMBER LAST YEAR; Saudi Arabia's crude oil production in May was relatively stable at 9.006 million barrels per day, while Russia's output in May was 9.225 million barrels, down from 9.508 million barrels at the end of last year. U.S. crude oil production remained unchanged at 13.2 million barrels per day.

In terms of inventories, U.S. commercial crude oil inventories rose by 3.591 million barrels in the week ended June 21 versus an expected decrease of 2.381 million barrels, Cushing crude inventories fell by 226,000 barrels, and strategic crude inventories rose by 1.285 million barrels to 372 million barrels. The current U.S. commercial crude oil inventories are slightly below the average of the past five years, Cushing crude oil inventories are below the average of the past five years, and strategic crude oil inventories are at historically low levels. In terms of refined oil products, distillate inventories decreased by 377,000 barrels to an expected decrease of 620,000 barrels, and gasoline inventories increased by 2.654 million barrels to an expected decrease of 1.2989 million barrels.

Sino Global Gold Fund:

In the statement, the Fed said it had made modest new progress in controlling inflation and removed specific adjustments to its balance sheet reduction program. In addition, the Federal Reserve released new economic forecast data, and the GDP growth forecast for 2024-2026 remains unchanged, at 2.1%, 2%, and 2%, respectively; The unemployment rate was raised from 4%, 4.1% and 4% to 4%, 4.2% and 4.1%; The growth rate of the core PCE price index was raised from 2.6%, 2.2% and 2% to 2.8%, 2.3% and 2%; The dot plot has been updated to raise the forecast for the federal funds rate from 4.6% to 5.1% in 2024, implying a 25bp rate cut in 2024; In addition, the new dot plot implies a rate cut of 100bp for 2025-2026, respectively.

Sino Analytica's Real Estate:

Although the timing of the Fed's actual start of interest rate cuts may be different from market expectations, the current downward cycle of US interest rates is basically certain. REITs have adjusted significantly during the interest rate upward cycle, which is mainly affected by the combined attributes of bonds and stocks, making the performance of REITs far behind the performance of equity assets. In the future, with the opening of the downward cycle of interest rates, it will be beneficial to the equity attributes and bond attributes of REITs assets at the same time, and the downward interest rate will make REITs expected to obtain greater upward elasticity than equity assets.

Judging from the performance of REITs companies in the first quarter of 2024, the performance of hotel and entertainment, office, and retail REITs is better than expected, while special REITs lag behind. In the second quarter, the performance growth rate of REITs generally faced a high base, the performance growth of medical and industrial REITs was more sustainable, and office REITs remained weak.

Recent views on major equity markets:

U.S. stocks:

On the employment front, U.S. nonfarm payrolls rose by 272,000 in May, surpassing the previous 12-month average of 232,000 monthly increases. The main job additions came from healthcare, government, leisure and hospitality services, and professional, scientific and technical services.

GDP growth for the first quarter of 2024 was revised to 1.3%, below the preliminary estimate of 1.6%. Downward revisions in consumer spending, private inventory investment, and federal government spending were partially offset by upward revisions to state and local government spending, non-residential fixed investment, residential fixed investment, and exports.

CPI rose 0.2% month-on-month and 3.3% year-on-year in May. The energy index fell by 2.0%, while the food index edged up by 0.1%. The core CPI, which excludes food and energy, rose 0.2%, with housing costs being the main driver. The PCE price index for May will be released on June 28. The consensus expectation is that the PCE index and the core PCE index may slow down, which may affect the Fed's interest rate decision.

In addition to economic data, the focus of the US market is on the US election. The current U.S. election situation revolves around primaries and candidate campaigns. Candidates from all parties are actively engaged in campaign rallies and debates, focusing on economic policy, health care reform, and social equity. The latest polls show that the support of the main candidates is still fluctuating, and there is no clear leader yet.

Hong Kong stocks:

Overseas, the US Makit manufacturing and services PMIs beat market expectations this week, diverging from a series of weak economic data released last Thursday. The real GDP of the United States in 2024Q1 was 1.4%, a slight upward revision from the revised value of 1.3%, and the annualized quarterly growth of personal consumption expenditures was 1.5%, less than the expected 2%; Core PCE rose 3.7% quarter-on-quarter, a slight upward revision from 3.6% in the previous month. After the release of the data, the 2Y U.S. Treasury yield fell quickly to around 4.7%. The market reaction has been more positive. The signs of weakening of the U.S. economy are becoming more and more obvious, and it is necessary to pay attention to inflation data in the future, and the market's expectations for interest rate cuts are heating up in stages. In addition to economic data, the first presidential debate in this week's U.S. election began at 9 p.m. ET on June 28, with Biden and Trump debating issues such as the economy, abortion, and immigration. Overall, the content of the first debate continued the attitudes of the previous two candidates on various issues, and the two candidates also attacked and blamed each other, and after the debate, Biden performed poorly overall, and polls also showed that Trump's current approval rating is rising rapidly.

Risk Warning: The above market data comes from Bloomberg. This material is the view of Sino Analytica and is not intended as investment advice. In no event does the information or opinions expressed in this report constitute investment advice to any person. The market is risky, and investors need to be cautious. When investing in the funds managed by the Company, investors should carefully read the Fund Contract, Custody Agreement, Prospectus, Risk Statement, Fund Product Key Facts Statement and other documents and relevant announcements, truthfully fill in or update personal information, check their own risk tolerance, and choose fund products that match their risk identification ability and risk tolerance. Investors need to be aware that there are circumstances in which the investment in the fund may result in the loss of principal. The fund manager undertakes to manage and use the fund assets in good faith, diligence and responsibility, but does not guarantee that the fund will be profitable, nor does it guarantee a minimum return. The performance of other funds managed by the fund manager is not indicative of the performance of the fund. Past performance and net worth of a fund are not indicative of future performance. The fund manager reminds investors of the principle of "buyer's responsibility" in fund investment, and after making investment decisions, investors shall bear the investment risks caused by changes in the operation status of the fund and the net value of the fund. The mainland fund has been in operation for a relatively short period of time and does not reflect all stages of the development of the stock market.