Market Roundup
- EUR/USD 0.09%, USD/JPY -0.03%, GBP/USD 0.38%, EUR/GBP -0.29%
- DXY -0.38%, DAX 1.38%, FTSE 0.61%, Brent 1.07%, Gold 0.43%
- Great Britain Jun Markit/CIPS Cons PMI, 53.1, 52.5 forecast, 52.5 previous
- EZ May Producer Prices MM, 0.8%, 0.4% forecast, 0.0% previous
- EZ May Producer Prices YY, 3.0%, 2.7% forecast, 2.0% previous
- EZ May Retail Sales MM, 0.0%, 0.1% forecast, 0.1% previous
- EZ May Retail Sales YY, 1.4%, 1.5% forecast, 1.7% previous
- France May Budget Balance, -55.10 bln, -54.34 bln previous
- Bank of Japan seen cutting price forecasts as inflation expectations stall
- Greece can go it alone without bailouts and the troika - Moscovici
- German SPD say need to study Merkel's migrant deal with Bavaria
- Former Malaysian PM Najib arrested in graft probe
- Swedish central bank holds rates, sees hike near year-end
- Italy cracks down on temporary work, firms that move abroad
Economic Data Ahead
- (0930 ET/1330 GMT) The Markit will release Canada's Manufacturing PMI for the Month of June. The indicator rose to a seasonally adjusted reading of 56.2 in the prior month.
- (0945 ET/1345 GMT) The NAPM-New York releases ISM-New York Index for the month of June. The index stood at 66.9 in the previous month.
- (1000 ET/1400 GMT) The United States is likely to report that factory orders remained unchanged in May after decreasing 0.8 percent in April.
- (1000 ET/1400 GMT) The Investor's Business Daily (IBD)/ TechnoMetrica Institute of Policy and Politics (TIPP) will release U.S. Economic Optimism index for the month of July. The indicator rose to 53.9 in June.
- (1530 ET/1930 GMT) Autodata Corp is expected to report that U.S. auto sales figures rose to an annualized rate of 17.00 million units in June from 16.91 million units in May.
- (1630 ET/2030 GMT) API reports its weekly crude oil stock.
Key Events Ahead
- (1200 ET/1600 GMT) European Central Bank Chief Economist Peter Praet speaks in Bucharest
FX Beat
DXY: The dollar index declined ahead of a looming July 6 deadline for Washington to impose tariffs on $34 billion worth of Chinese goods that Beijing has vowed to match with tariffs on U.S. products. The greenback against a basket of currencies trades 0.2 percent down at 94.70, having touched a high of 95.53 on Thursday, its highest since July 2017. FxWirePro's Hourly Dollar Strength Index stood at -41.73 (Neutral) by 1000 GMT.
EUR/USD: The euro rose after Germany's coalition settled a row over migration that had threatened to topple Chancellor Angela Merkel's government. Moreover, data showing monthly producer price index rose by 0.8 percent in May, higher than market expectations of a 0.4 percent rise boosted investor sentiment. The European currency traded 0.1 percent up at 1.1650, having touched a high of 1.1719 last week, its highest since June 14. FxWirePro's Hourly Euro Strength Index stood at 32.99 (Neutral) by 1000 GMT. Immediate resistance is located at 1.1700, a break above targets 1.1744 (June 4 High). On the downside, support is seen at 1.1530 (June 19 Low), a break below could drag it till 1.1500.
USD/JPY: The dollar trimmed gains after rising to a 1-1/2 month peak earlier as U.S. President Donald Trump warned the World Trade Organization that he will take some actions if the United States is not treated properly. The major was trading 0.05 percent down at 110.85, having hit a high of 111.13 earlier, its highest since May 22. FxWirePro's Hourly Yen Strength Index stood at -88.23 (Slightly Bearish) by 1000 GMT. Investors’ will continue to track broad-based market sentiment, ahead of the U.S. factory orders and business conditions index. Immediate resistance is located at 111.39 (May 21 High), a break above targets 111.08 (June 18 High). On the downside, support is seen at 110.59 (5-DMA), a break below could take it lower 109.68 (June 27 Low).
GBP/USD: Sterling rose, reversing previous session losses after data showed Britain's construction industry grew at its fastest rate in seven months, but companies remained concerned about the outlook ahead of Brexit. The economy's Construction Purchasing Managers' Index edged up to 53.1 in June from previous months reading of 52.5. The major traded 0.3 percent up at 1.3184, having hit a low of 1.3049 on Thursday; it’s lowest since Nov. 2. FxWirePro's Hourly Sterling Strength Index stood at -38.61 (Neutral) 1000 GMT. Immediate resistance is located at 1.3230, a break above could take it near 1.3314 (June 22 High). On the downside, support is seen at 1.3102 (June 21 Low), a break below targets 1.3049 (June 28 Low). Against the euro, the pound was trading 0.3 percent up at 88.32 pence, having hit a low of 88.90 pence on Friday, it’s lowest since March 12.
USD/CHF: The Swiss franc consolidated within narrow ranges as investor’s awaited minutes of the U.S. Federal Reserve's June meeting and employment data that could confirm whether policymakers will hike interest rates twice this year. The major trades 0.05 percent up at 0.9935, having touched a high of 0.9992 on Thursday, it’s highest since May 21. FxWirePro's Hourly Swiss Franc Strength Index stood at 33.39 (Neutral) by 1000 GMT. On the higher side, near-term resistance is around 0.9977 (June 19 High) and any break above will take the pair to next level till 1.0018 (May 18 High). The near-term support is around 0.9880 and any close below that level will drag it till 0.9855.
Equities Recap
European shares advanced as Germany's Christian Social Union (CSU) party reached a deal with Chancellor Merkel’s Christian Democrats (CDU) over illegal immigration.
The pan-European STOXX 600 index rallied 0.9 percent at 380.15 points, while the FTSEurofirst 300 index surged 0.9 percent to 1,489.41 points.
Britain's FTSE 100 trades 0.5 percent up at 7,586.53 points, while mid-cap FTSE 250 rose 0.4 percent to 20,694.17 points.
Germany's DAX rose 1.3 percent at 12,395.99 points; France's CAC 40 trades 0.9 percent higher at 5,328.50 points.
Commodities Recap
Crude oil prices rallied after Libya declared force majeure on some of its crude exports, while the loss of Canadian supplies boosted U.S. crude to 3-1/2-year peaks. International benchmark Brent crude was trading 0.8 percent up at $77.94 per barrel by 1024 GMT, having hit a high of $79.53 on Friday, its highest since May 31. U.S. West Texas Intermediate was trading 0.9 percent higher at $74.73 a barrel, after rising as high as $74.87, its highest since Nov. 2014.
Gold prices rebounded from a near 7-month low hit earlier in the day as the dollar eased amid heightening trade friction between the United States and major economies. Spot gold was up 0.4 percent at $1,246.68 an ounce by 1027 GMT, having declined to a low of $1,237.82, its lowest since Dec. 12. U.S. gold futures rose 0.3 percent to $1,245.80 an ounce.
Treasuries Recap
The 10-year U.S Treasury yield stood at 2.872 percent higher by 0.006 bps, while 5-year yield was 0.004 bps up at 2.756 percent.
The Japanese government bond prices dipped, weighed down by an overnight retreat by U.S. Treasuries. The five-year and 10-year JGB yields were half a basis point higher at minus 0.115 percent and 0.025 percent, respectively. September 10-year JGB futures were down 0.01 point at 150.93, off a low of 150.89 plumbed earlier.
The Australian government bond futures rallied to multi-month peaks. The 3-year bond contract was near its highest since December at 97.955, while the 10-year contract added 1 tick to 97.4050. The New Zealand government bonds gained, sending yields 4 basis points lower at the long end of the curve.
