The US indices are higher on Wednesday after some solid earnings, led by the banks, boosted financial and industrial stocks and reinforced expectations for a strong Q2 reporting season. The US$ is mixed, with commodity currencies bouncing from an early dip, underpinned by positive risk sentiment because of the stock market rally, while Sterling took a hit after the UK CPI missed market expectations, lowering the chances of an August BoE hike. The headline UK CPI was unchanged at 2.4% yy in June, below expectation of 2.6% yy. Ongoing Brexit uncertainty is also weighing on Sterling. In other markets, Gold remains heavy at 12 month lows while WTI had a choppy session but is pretty much unchanged at the end of the day, at $68pb.
In other data on Tuesday, the US housing starts dropped to 1.17 mio annualised in June, while the building permits dropped to 1.27 mio. The EU CPI was finalised at 2.0% yy in June, core CPI at 0.9% yy, in line with expectations.
Thursday will begin with a busy session for Australia, which will include the Q2 NAB Business Confidence/Conditions and the June Unemployment figure (exp 5.5%, +17K, PR; 65.5). After that though It all becomes rather thin, with just the UK Retail Sales for June (exp 0.4%mm, 3.9%yy; Ex-Fuel 0.3%mm, 3.7%yy), and then later in the session, the Philadelphia Fed Mfg Survey, the weekly US Jobless Claims and a speech from the Fed’s Quarles.
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