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Speaker 1: Let's get to our guest, June Wrong is with US

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Speaker 1: market strategist at i G to discuss the latest on

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Speaker 1: up market action. June Wrong, thanks for being with us

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Speaker 1: there from Singapore. Very curious day here in the States.

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Speaker 1: We get a heart reading on CPI, the equity market

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Speaker 1: takes off yield spike across the curve, yet the dollar weekends.

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Speaker 1: How do you make sense of a day like today? Hi,

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Speaker 1: good morning, Thanks for having me. So it's definitely very

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Speaker 1: interesting to watch your army. We saw an initial move

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Speaker 1: lower for a major U S indisance, but that was

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Speaker 1: a massively a kind of an overturned. Personally, I believe

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Speaker 1: that these are extreme barish of positioning heading into this.

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Speaker 1: A cp I brain has kind of driven some of

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Speaker 1: deep buias to challenge this ability in supply of a

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Speaker 1: newer sellers. So it's definitely very interesting to watch. So

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Speaker 1: you kind of have some opposing sort of a narrative,

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Speaker 1: as you mentioned, in terms of the weaker US dollar.

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Speaker 1: So it does suggest that some of the bolish momentum

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Speaker 1: in terms of the years dollar could could be seeing

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Speaker 1: some side of a bating at least in Newton. Even

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Speaker 1: though I maintain the stance that the overall upside rates

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Speaker 1: to inflation the remains, so they should kind of keep

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Speaker 1: the US dollar at least on the up trend. But

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Speaker 1: as for now, you know, with these extreme positioning in

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Speaker 1: place and with the U S CPI data behind us. Now,

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Speaker 1: I think what markets are really trying to focus on

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Speaker 1: will be in terms of the upcoming a US earning season,

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Speaker 1: and I think that the moderation in evaluation on that

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Speaker 1: front kind of a provide these a low hurdle for

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Speaker 1: our performance. So I believe that that could be you

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Speaker 1: know what has been catching a sort of the market

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Speaker 1: attention moving forward, and we know that we will be

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Speaker 1: having the major US banks earnings later today, so I

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Speaker 1: think that we will be the key focused. Yeah. Can

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Speaker 1: we stay with any confidence now given the reaction that

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Speaker 1: we saw following the CPI printed the bottoms in fair equities? Yes,

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Speaker 1: I think we can look towards a year and a

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Speaker 1: relief rarely in the global assets. But then I believe

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Speaker 1: that the market bottom may potentially only be seen the

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Speaker 1: next year, or I believe that there could be a

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Speaker 1: year and a really really could be attributed to a

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Speaker 1: few effectors. I mean, a seasonality is one November December

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Speaker 1: tends to see more or positive a performance the post

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Speaker 1: and midterms, and performance is also another Catholics. I mean

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Speaker 1: a historical data tends to show that the average one

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Speaker 1: year written after these midterms election tends to be more

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Speaker 1: positive as compared to the other year. So you wouldn't

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Speaker 1: really want to get into the way of the opposts really,

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Speaker 1: And of course, as I mentioned US earnings, I think

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Speaker 1: a lot of it has been a price in. I

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Speaker 1: mean expectations are for a growth rate for earnings to

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Speaker 1: be addised lower since a quarter, so expectations heading into

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Speaker 1: the earning season are allowed to begin with, and we've

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Speaker 1: seen it playing in the second quarter right where our

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Speaker 1: corporate earnings and outlook world week. But markets are managed

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Speaker 1: to take on any signs of resilience. And John, we

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Speaker 1: heard that it just mentioned that of the restrictions are

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Speaker 1: easing in Hong Kong. No such policy change on the mainland, however,

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Speaker 1: zero COVID still very much part of the landscape. Do

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Speaker 1: you anticipate this changing after the People's Congress and President

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Speaker 1: she gets that third term. Yes, I mean we have

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Speaker 1: been getting some sort of a hema recently from all

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Speaker 1: of these national Chinese newspaper. It kind of hinder that

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Speaker 1: we could be expecting this or zero COVID nighting stands

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Speaker 1: to remain ahead of the Party Congress. So even though

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Speaker 1: I will be expecting a further policy or support managers

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Speaker 1: to be announced during the outcoming congress, but these are

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Speaker 1: zero COVID nighting policy is definitely one that the markets

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Speaker 1: where we'll be looking up for because looking at the

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Speaker 1: air muted or growth outlooking China along with all of

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Speaker 1: these are on and all for economic disruption caused by

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Speaker 1: these a strict virus stands, it seems that some sort

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Speaker 1: of plans that have to be in place as sooner

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Speaker 1: or later, So even though these are strict virus stands

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Speaker 1: may remain. I believe that one market watchers I want

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Speaker 1: to see could be any signs of any move closer

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Speaker 1: towards a real opening such as you know, boosting the

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Speaker 1: vaccination rate or even you know renting out a capacity

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Speaker 1: in their healthcare system. Overall, I believe it is the

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Speaker 1: the strict policies then continues to stick. It is really

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Speaker 1: hard for Chinese equity to really see a moral sustained

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Speaker 1: outside as well as the uncertainty over all of this

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Speaker 1: disruption will kind of detail our market sentiments from taking

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Speaker 1: on an accessive risk, so confidence could be more major

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Speaker 1: in that sense. So we'll definitely have to see how

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Speaker 1: it play out. So are there other markets or opportunities

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Speaker 1: that you're seeing in the Asia Pacific out away from China.

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Speaker 1: Um in terms of a market preference, currently is a

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Speaker 1: slightly towards the Japan. I believe the macroeconomic team for

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Speaker 1: Japan and may potentially be the ongoing recovery as we

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Speaker 1: move from a moral early recovery recovery cycle to a

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Speaker 1: moral mid cycle recovery. So during this phase a couple

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Speaker 1: earnings may see some sort of a resilience, even though

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Speaker 1: not at the strong growth out that we have witnessed

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Speaker 1: over the past few years. And also lived that this

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Speaker 1: delayed recovery out of the COVID nighting a pandemic could

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Speaker 1: also provide some form of a tail win in terms

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Speaker 1: of the neil term of PENU demand from a consumers.

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Speaker 1: And we know that this is a gradual reopening of

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Speaker 1: the travel borders is in place, so that made it

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Speaker 1: to support its services sector in the coming months. And

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Speaker 1: last one not least, we know that the accommodative for

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Speaker 1: policies are still remain in place, so that could still

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Speaker 1: you know, provide some form of for support in terms

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Speaker 1: of a Japan's economy. In terms of Japan, we've got

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Speaker 1: the UN continuing the weekend one forty seven twenty six,

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Speaker 1: we kind of passed the level now with the policymakers

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Speaker 1: last intervene. Do you anticipate more intervention and what does

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Speaker 1: this mean for Japan on the main time being a

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Speaker 1: net oil and border. Yeah, so then if you look

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Speaker 1: at the weekend story, I think the authorities have been

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Speaker 1: trying to step in, but currently the dollar yen seems

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Speaker 1: to be breaching the previous level of intervention a few

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Speaker 1: months back, so that really bought the question of whether

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Speaker 1: you know authorities will want to step in again, and

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Speaker 1: looking at its foreign reserves, they definitely have the room

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Speaker 1: to do so. I mean more than one trillion worth

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Speaker 1: of this these a foreign reserve that give them the ammunition.

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Speaker 1: So it's really up to their intention. So I believe

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Speaker 1: their intention is really to to try to deter this

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Speaker 1: a very strong search in this U. S Dollar strength

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Speaker 1: against the Japanese end, they could be looking at a

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Speaker 1: more a gradual and a more major increase or or

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Speaker 1: or a more major weakening of the of the end itself.

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Speaker 1: So I think there is what they are really trying

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Speaker 1: to look out for. Its compared to really having this

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Speaker 1: fixed level and looking ahead. I believe that you know,

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Speaker 1: with these a more major or more major weakness in

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Speaker 1: the Japanese game, So that could really allow firms to

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Speaker 1: adjust some more quickly to all of these increasing import prises. Alright,

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Speaker 1: General market strategist at I G. Thanks so much for

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Speaker 1: joining us on Bloomberg Day. Bracasia