Market Roundup
• Trump prepares for 'productive' talks with Xi on trade war
• Fed's Kaplan isn't ready to cut interest rates -Fox Business Network
• US May Consumption, Adjusted MM, 0.4%, 0.4% forecast, 0.3% previous
• US May Core PCE Price Index MM, 0.2%, 0.2% forecast, 0.2% previous
• US May Core PCE Price Index YY, 1.6%, 1.6% forecast 1.6% previous
• US Jun Chicago PMI, 49.7, 53.1 forecast, 54.2 previous
• US Jun U Mich Sentiment Final, 98.2, 98.0 forecast, 97.9 previous
• ECB's active policy justified given low inflation, risks, Villeroy says
• CA Apr GDP MM, 0.3%, 0.1% forecast, 0.5% previous
• CA May Producer Prices MM, 0.1%, 0.1% forecast, 0.8% previous
[Looking Ahead - Economic Data (GMT)]• 30 Jun 01:00 CN Jun NBS Non-Mfg PMI, 54.3 previous
• 30 Jun 01:00 CN Jun NBS Manufacturing PMI, 49.5 forecast, 49.4 previous
• 30 Jun 22:30 AU Jun AIG Manufacturing Index, 52.7 previous
• 30 Jun 23:50 JP Q2 Tankan Big Mf Idx, 9 forecast, 12 previous
• 30 Jun 23:50 JP Q2 Tankan Big Mf Outlook DI, 6 forecast, 8 previous
• 30 June 23:50 JP Q2 Tankan Big Non-Mf Idx, 20 forecast, 21 previous
• 30 June 23:50 JP Q2 Tankan All Big Capex Est, 8.9% forecast, 1.2% previous
• 30 June 23:50 JP Q2 Tankan Small Mf Idx, 2 forecast, 6 previous
• 1 July 00:30 JP June Nikkei Mfg PMI, 49.5 previous
• 1 Jul 01:45 CN Jun Caixin Mfg PMI Final, 50.0 forecast, 50.2 previous
• 1 July 22:00 NZ Q2 NZIER Confidence, -29 previous
[Looking Ahead - Events, Other Releases (GMT)]• N/A Fed's Richard Clarida, ECB's Philip Lane, PBOC's Yi Gang and ECB rate setters Klas Knot, Olli Rehn and Hernandez de Cos speak in Helsinki
• 06:45 Opening speech of ECB vice president Luis de Guindos at the 13th ECB Central Banking Seminar "Monetary policy in the euro area" in Frankfurt, Germany
• 21:00 Reserve Bank of New Zealand Assistant Governor Geoff Bascand delivers a speech entitled "macroprudential policy: past, present and future." in Wellington
Currency summaries
EUR/USD: The euro was little changed against the U.S. dollar on Friday, ahead of a meeting between the United States and China at the Group of 20 summit in Japan, shaking off light pressure from U.S. economic data that did nothing to derail speculation about a July interest rate cut.The core U.S. personal consumption expenditure price index rose 0.2% in May, as expected, reinforcing investor expectations that the Federal Reserve will cut rates by at least 25 basis points at the next meeting. It remains unclear whether U.S. President Donald Trump and Chinese President Xi Jinping will agree on a truce when they meet at the G20, or escalate their trade conflict further, leaving investors unsure about how to trade the dollar. The euro was down 0.01 percent at $1.1367. An index that tracks the dollar versus a basket of six major currencies was down 0.09 at 96.13 after hitting a 16-month high of 97.693 on Monday. Immediate resistance can be seen at 1.1427 (Higher Bollinger Bands), an upside break can trigger rise towards 1.1447 (20th March High).On the downside, immediate support is seen at 1.1327 (9 DMA), a break below could take the pair towards 1.1289 (21 DMA).
GBP/USD: Sterling recovered against dollar on Friday from the five-month lows it reached earlier in the day against the dollar and euro, although worries about a no-deal Brexit capped the currency's gains. Investors are reluctant to take big positions in the pound amid the Conservative party leadership contest, which should end with a new prime minister in place by the end of July.Boris Johnson, the frontrunner, has said Britain will leave the European Union on Oct. 31 deal or no deal. But he has also said there is only one chance in a million of leaving without an agreement in place. Sterling was up 0.4% at $1.2712, bringing its gains in June to more than 3%. After touching five-month lows, it returned to positive territory as the dollar index eased 0.15%. Immediate resistance can be seen at 1.2785 (50 DMA), an upside break can trigger rise towards 1.2850 (61.8 % retracement level).On the downside, immediate support is seen at 1.2655 (Daily low), a break below could take the pair towards 1.2600 (Psychological level).
USD/CAD: The Canadian dollar strengthened to a near eight-month high against the greenback on Friday after domestic data supported the view that the Bank of Canada will not be cutting interest rates over the coming months. Canada’s economy grew by 0.3% in April, Statistics Canada data indicated, faster than the 0.1% pace that analysts had predicted, while a business outlook survey by the Bank of Canada showed that Canadian firms expect an increase in sales growth over the coming year. The price of oil, one of Canada's major exports, edged lower ahead of talks over the trade dispute between the U.S. and Chinese presidents this weekend and on production cuts from OPEC on Monday. The Canadian dollar was last trading 0.06% higher at 1.3087 to the greenback, or 76.41 U.S. cents. The currency touched its strongest level since Nov. 7 last year at 1.3060.For the month, the loonie was up 3.3%. Immediate resistance can be seen at 1.3132 (5 DMA), an upside break can trigger rise towards 1.3190 (9 DMA).On the downside, immediate support is seen at 1.3044 (Lower Bollinger Band ), a break below could take the pair towards 1.3000 (Psychological level).
USD/JPY: The dollar weakened against the Japanese yen on Friday, as investors awaited a crucial meeting between the leaders of the United States and China at a Group of 20 summit over the weekend for any signs of progress to end their heated trade war.The mood improved the previous day after the South China Morning Post said Washington and Beijing were laying out an agreement that would help avert the next round of tariffs on an additional $300 billion of Chinese imports.Negotiations between the world's two largest economies have been fraught, so traders and analysts caution that a resolution at the G20 summit is far from certain. Yet, markets seem to be clinging on to hopes of progress in a meeting between U.S. President Donald Trump and Chinese President Xi Jinping at the G20 in the western Japanese city of Osaka.The dollar was 0.12 percent higher versus the Japanese yen at 107.91 Strong resistance can be seen at 108.15 (Daily high), an upside break can trigger rise towards 108.33 (23.6 % retracement level).On the downside, immediate support is seen at 107.56 (61.8 % retracement level), a break below could take the pair towards 106.00(Psychological level).
Equities Recap
A surge in German shares helped European equities mark their best first-half performance in over two decades on Friday, with investors awaiting the outcome of U.S-China trade talks to see if the rally can continue.
UK's benchmark FTSE 100 closed down by 1.5 percent, the pan-European FTSEurofirst 300 ended the day down by 1.83 percent, Germany's Dax ended down by 2.4 percent, France’s CAC finished the day down by 0.6 percent.
Wall Street advanced in heavy trading on Friday, with the S&P 500 and the Dow closing the book on their best June in generations, ahead of much-anticipated trade talks between U.S. President Donald Trump and Chinese counterpart Xi Jinping at the G20 summit now underway in Japan.
Dow Jones closed up by 0.53 percent, S&P 500 ended up 0.44 percent, Nasdaq finished the day up by 0.46 percent.
Treasuries Recap
U.S. Treasuries were little changed on the day on Friday as investors waited on talks between the United States and China on Saturday for signs that leaders will de-escalate a trade war that has been blamed for harming global economic growth.
Commodities Recap
Gold prices held steady on Friday as investors waited to see if a crucial round of U.S.-China trade talks over the weekend would resolve the bilateral dispute, while platinum surged more than 3%.
Spot gold was little changed at $1,409.33 per ounce as of 1:35 p.m. EDT(1735 GMT). Prices surpassed the key psychological $1,400 level earlier this week to reach $1,438.63 for the first time in six years.U.S. gold futures settled 0.1% higher to $1,413.70 per ounce.
Oil prices fell on Friday but posted their second straight week of gains ahead of trade talks between the U.S. and Chinese presidents this weekend, and on widely expected production cuts from OPEC on Monday.
The most active September Brent crude futures fell 93 cents to settle at $64.74 a barrel. Brent August crude futures settled unchanged at $66.55 a barrel. U.S. West Texas Intermediate (WTI) crude futures lost 96 cents to settle at $58.47 a barrel.
