Global equities remained mainly flat yesterday, with Asia closing slightly down this morning ahead of today’s US data deluge and FOMC member speeches – both which are expected to throw light on a questionable FED rate cut later this month. Talks between South Korea and Japan over the latter’s export controls continue to falter – each side accusing the other of misrepresentation.
European equities were mixed yesterday as the European Parliament prepares to vote in a new Commission President. The EU is contesting Turkey’s rights to drill for oil and gas off the coast of Cyprus. It has so far suspended talks on air transport and association matters and has instructed the European Investment Bank to review its loans to Turkey. The pound lost 50 pips yesterday on Brexit concerns after Conservative candidates Johnson & Hunt said that the Northern Irish backstop in the Brexit agreement was unacceptable.
President Trump yesterday poured some more oil on trade tensions, saying that tariffs were impacting the Chinese economy and warning that more could come as talks between US & Chinese officials continue to flounder. He and Xi are not as close as they once were, said Trump in a speech. The dollar added 20 cents on the index
yesterday after the White House Office of Management and Budge downgraded its estimate of the federal budget by about $90 bn. The March number is expected to come in at a clean trillion-dollar deficit. Yesterday’s Empire State Manufacturing Index showed a 4.3 point positive in July, up from -8.6 points in June.
WTI yesterday lost 70 cents yesterday as Mexican drilling resumed after a hurricane shutdown; gold trading
is maintaining a steady 1410-1420 range; and Bitcoin
is developing another between 10.5K and 11, as the Libra story
unfolds. Facebook executives have said they would not release their cryptocurrency
without US approval. Facebook VP David Marcus said that Libra would be regulated under the Swiss Federal Data Protection and Information Commission.
Alibaba shares were up 2.6% yesterday after shareholders approved an 8:1 stock split ahead of the company’s Hong Kong listing. Citigroup yesterday beat quarterly earnings expectations, revenues up 2% but shares down less than 1/10th of a percent. With FANGs expected to announce quarterly earnings next week, the US Congress is poised to question all but Netflix
on anti-trust matters. Fox News yesterday said that the White House was considering a major crackdown on Google over its “anti-conservative bias”. Today’s reports are from Goldman Sachs Group Inc (expected EPS: 4.82), Johnson & Johnson (expected EPS: 2.42), and JPMorgan Chase & Co (expected EPS: 2.53).
Today’s Top Economic Events
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|08:00 AM GMT – Italy
||Trade Balance. CPIs at 09:00
|08:30 AM GMT – UK
||Claimant Count Rate (Jun), Average Earnings, Unemployment & Unemployment (May). BoE’s Governor Carney speech at 12:00
|09:00 AM GMT – Germany
||ZEW – Economic Sentiment & Current Situation (Jul)
|09:00 AM GMT – EU
||Trade Balance (May) and ZEW Economic Sentiment (Jul)
|12:30 PM GMT – US
||Retail Sales, Import & Export Price Indexes (MoM) (Jun). Redbook Index (Jul 12) at 12:55. Capacity Utilization & Industrial Production (Jun) at 13:15. Business Inventories (May) & NAHB Housing Market Index (Jul) at 14:00. Fed’s Chair Powell at 17:00, and Fed’s Evans speech at 19:30
|12:30 PM GMT – Canada
||Portfolio Investment in Canadian & Foreign Securities (May)
|20:30 PM GMT – OIL
||API Weekly Crude Oil Stock (Jul 12)
|00:30 AM GMT (+1) – Australia
||Westpac Leading Index (MoM) (Jun)