In today’s briefing:
- US Inflation Creeps In Quietly
- Korean Government’s New Task Force for Inclusion in a Major Global Index + IBKR Korea Trading Signal
- Real Asset Chartbook Week #14: Big Week for Critical Metals and Missives on the History of US Trade
- Big, Beautiful Folly – Underweight Treasuries
- CX Daily: Controversial Mind-Body Therapy Attracts Over 1 Million Chinese Seeking Miraculous Cures
- US: Subdued Inflation to Oblige a Reluctant Fed to Cut This Month, but No More in ’25
- Global base oils arb outlook: Week of 14 July
- Americas/EMEA base oils supply outlook: Week of 14 July
- Asia base oils supply outlook: Week of 14 July
- Americas/EMEA base oils demand outlook: Week of 14 July
US Inflation Creeps In Quietly
- Rebounding headline and core US inflation in June understated the underlying growth, with shelter rising at its slowest pace since August 2021. Tariff pain crept in belatedly.
- Commodities, less food, energy and car prices grew by 0.3% m-o-m, the fastest since Feb-23, and services (ex-shelter) hit 0.4% m-o-m, both inconsistent with the target.
- Less than half of the post-election surge in expectations has survived so far. Further rises remain likely, even if sustained avoidance smooths and reduces the full impact.
Korean Government’s New Task Force for Inclusion in a Major Global Index + IBKR Korea Trading Signal
- In this insight, we discuss Korean government’s new task force for Korea to be included in a major global index.
- Prior to this major market moving event, there will be some important signals.
- One of the most important signals could be major global securities companies (such as IBKR/TD Ameritrade) allowing trading of Korean stocks to customers world-wide.
Real Asset Chartbook Week #14: Big Week for Critical Metals and Missives on the History of US Trade
- Given the copper tariff announcement this week, it seemed worthwhile to sketch out where the US gets its copper from, as the situation is not nearly as dire as a 50% tariff makes it out to be.
- We think a little context goes a long way in this situation and leads us to believe that the tariff is a wholly unnecessary impediment to a well-functioning market.
- If Trump were serious about achieving self-sufficiency in copper, he would focus on permitting reform, as we have plenty of domestic copper and only lack the smelting/refining capacity.
Big, Beautiful Folly – Underweight Treasuries
- The investment implications of Trump’s One Big Beautiful Bill are underweight US government debt and overweight US equities.
- The bill is just plain old fashion demand side fiscal stimulus.
- Favour momentum stocks with a sectoral bias towards consumer discretionary, tech, industrials, traditional energy, defence. Underweight renewables and Treasuries and increase exposure to Bitcoin.
CX Daily: Controversial Mind-Body Therapy Attracts Over 1 Million Chinese Seeking Miraculous Cures
- Therapy /Cover Story: Controversial mind-body therapy attracts 1 million Chinese seeking miraculous cures
- Kindergarten /China province elevates probe into kindergarten lead-poisoning scandal
- Dialysis /In Depth: The illicit drug trade lurking behind ‘free’ dialysis
US: Subdued Inflation to Oblige a Reluctant Fed to Cut This Month, but No More in ’25
- Core PCE and CPI inflation remained at 4-year lows in Apr-May’25 despite Trump’s tariffs, although June core CPI inflation crept up MoM after further tariff hikes (on steel and aluminium).
- M2 growth of just 5.2%YoY (May’25) is a restraining factor on inflation. However, tariff hikes have been much higher than we expected, with most trading partners failing to negotiate reductions.
- For consistency with 2024 cuts, the FOMC likely will cut rates this month. But the tariff hikes on most trading partners will push core inflation toward 3%, disallowing further cuts.
Global base oils arb outlook: Week of 14 July
- Europe’s Group II base oils prices hold unusually firm versus vacuum gasoil at start of Q3 2025.
- Europe’s Group II base oils price-differentials hold unusually firm vs Group I and Group III base oils at start of Q3 2025.
- Europe’s Group II base oils price-premium to Asia/US prices trends higher from early-Q2 2025.
Americas/EMEA base oils supply outlook: Week of 14 July
- US Group II base oils price-premium to heating oil edges lower, stays in narrow range since start of Q2 2025.
- Base oils price-premium stays rangebound even with expected improvement in supply and slowdown in demand in coming weeks.
- US base oils supply could rise more swiftly in coming weeks following completion of plant-maintenance work.
Asia base oils supply outlook: Week of 14 July
- Asia heavy-grade base oils price-premium to Singapore gasoil holds at elevated levels even as it slips from recent highs.
- High heavy-grade margins point to firm supply-demand fundamentals, incentivize refiners to maintain or raise output of the grades.
- Besides firm margins, outperformance of regional Group I SN 500 price relative to other grades and other regions points to even stronger fundamentals for that product.
Americas/EMEA base oils demand outlook: Week of 14 July
- US base oils demand could ease as seasonal slowdown in consumption coincides with rise in supply.
- Demand could get support from tighter surplus supply at start of Q3 2025 following recent plant-maintenance work in domestic and overseas markets.
- Tighter surplus supply curbs prospect of any imminent price-adjustments at time of year when fundamentals typically weaken.
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