Economic Indicators & Central Banks:
- Trading was nondescript with the markets digesting recent data, including the jobs report, and events including the elections overseas.
- Asian stock markets were supported, however, the positive mood didn’t spill over into Europe, where indexes are mostly lower.
- US futures are finding some buyers but investors are cautious ahead of Powell’s testimony. Powell will be questioned on the prospects for rate cuts.
- Japan: the BoJ will speak face-to-face with market participants over the next couple of days as the bank tries to set a realistic pace for the planned reduction of bond purchases.
- China: investors continue to weigh the bank’s new liquidity operations. The bank is aiming to take greater control over short-term borrowing costs and investors seem to take it like a rate hike, which put pressure on bonds. Markets are also looking ahead to the biggest annual policy meeting, with hopes of additional stimulus measures.
Asian & European Open:
- Wall Street was mixed. Strength in big tech rallied the NASDAQ and S&P500, albeit marginally, with gains of 0.28% and 0.10%, respectively. But the gains were enough for more fresh highs, the 25th and 35th of the year.
- Nikkei and Sensex touched fresh all-time highs, after the S&P500 led the way.
- Long bonds are also down in Europe and the US, after a drop in yields across key Asian markets.
Financial Markets Performance:
- The USDIndex softened to a session nadir of 104.80 on broadbased weakness, and especially as GBP and EUR stabilized. But the buck rebounded confidently to 105.09.
- Bitcoin steadied but remains below the key $59k level.
- Oil remained relatively stable following a 2-day decline, as Hurricane Beryl appeared less likely to cause significant disruptions to Texas’ crude infrastructure. However it’s hovering at the key 81.60 level (repeated resistance in the mid of June).
- Gold steadied after experiencing its largest drop in two weeks on Monday, while copper edged lower.
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Andria Pichidi
Market Analyst
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