FPG : Gold prices showed a cautious decline, reflecting the impact of the situation in the Middle East 1. American car companies have severed ties with the union. On Monday, Ford announced plans to lay off 550 employees in its central and western operations due to a recent strike by the United Auto Workers (UAW), affecting factory operations. This could signal the beginning of plant closures for traditional car production, serving as a deterrent to union workers. American auto workers are facing an uncertain future; avoiding strikes to protect their rights might result in job layoffs. 2. The United States is considering easing sanctions on Venezuelan crude oil. Venezuelan officials will sign an agreement in Barbados, attended by Biden administration officials. This move could result in the relaxation of certain sanctions, including those on Venezuela's oil industry, potentially increasing oil exports from Venezuela. The United States, despite being a major oil producer, seems to be searching for additional oil sources, exemplified by the recent events around Iran and the Palestinian-Israeli conflict. 3. A new round of stock repurchases and increased holdings has been initiated. On October 16, ten central enterprises announced such actions. This trend started in September, with over 40 A-share-listed companies having released announcements about increased holdings by shareholders, directors, supervisors, and distributors. Over 60 listed companies have announced share repurchase plans, with most of these repurchased shares used for stock incentives or employee stock ownership plans. This reflects a larger trend in the market that has its roots in the years following 2008, with companies favoring dividend repurchases. This approach has been fueled by low-interest rates, where corporate stock returns outperform corporate cash returns. However, the current scenario is different, with higher U.S. interest rates and lower interest rates in China. 4. South Korean financial regulators are planning to impose significant fines on Faba Bank and HSBC for illegal naked short selling. The Hong Kong subsidiary of Faba Bank was found to have engaged in illegal naked short selling of stocks like Kakao, with a total of 40 billion won in related transactions from September 2021 to May 2022. HSBC's Hong Kong subsidiary was also found to have engaged in illegal naked short selling of 9 stocks, including Silla Hotel, with total related transactions reaching 16 billion won from August 2021 to December. 5. Moody's postponed its evaluation of Israel's rating, citing concerns that the ongoing conflict may threaten the ability of Israeli debt issuers to withstand risks. This indicates a shift in focus in Western media reports towards the humanitarian crisis in the Gaza Strip, suggesting that the West may not support Israel's use of naked violence to address the situation. 6. Electric vehicle (EV) sales in the United States surged to over 300,000 for the first time in the third quarter, but Tesla's market share has hit an all-time low, currently representing only half of the market share, compared to 62% in the first quarter. Cox Motor Company suggests that Tesla might reverse this trend with the launch of the Cybertruck electric pickup trucks. The surge in EV sales is attributed to new offerings from major car companies, which have driven sales but also increased competitive pressure. King, an analyst at FPG, suggests that the conflict in the Middle East is risking escalation due to the short-selling of the Palestinian-Israeli conflict. Gold prices have broken through key technical levels, heading toward their best week in nearly seven months. Dovish remarks from Federal Reserve officials have also supported gold prices, as some officials hinted at no need to raise interest rates to combat inflation. Lower interest rates are typically favorable for gold. Dawson, another FPG analyst, notes that escalating Middle East tensions have dampened market risk appetite, leading to renewed favor for the US dollar among hedge funds. If the Middle East situation continues to worsen, the US dollar may remain favored, putting pressure on the euro. Additionally, the bond market continues to adjust, and the likelihood of fiscal stimulus like special treasury bonds is low. Ten-year treasury yields have entered the range of 2.65-2.75%, and they are expected to hover in this region in the short term. Dave, an analyst at FPG, emphasizes that capital expenditure is the primary constraint on crude oil production, resulting in an insufficient global long-term capital expenditure in the oil sector. As the world transitions to new energy sources, the demand for crude oil continues to grow. This could lead to persistent tightness in the supply-demand balance for oil over the long term, potentially supporting higher oil prices. Yue Lin, a special analyst at FPG, reports that the three major US stock indexes have opened positively. The Dow is up 0.57%, the Nasdaq is up 0.35%, and the S&P 500 has risen by 0.44%. The analyst mentions that Bitcoin is trading below $30,000, while blockchain-related stocks have strengthened. The market will likely continue to experience fluctuations by year-end, driven by factors such as high inflation and the Palestinian-Israeli conflict. The above analysis is only for the views of market researchers and is for reference only and is not Regarded as a specific investment suggestion. #Forex #trading #tradingforex