Stocks fell on Friday while the US$ was mixed, with safe haven demand for the Jpy and the Chf notable after a Chinese agricultural delegation cancelled a planned goodwill visit to the US agricultural heartland of Montana, which again raised questions on a positive trade outcome. This news also hurt the commodity currencies, with the Aud and Nzd both finishing at the week’s lows as the trade gloom heightened, while Gold headed higher as the need for a safe haven grew. WTI was choppy but pretty much unchanged.
Monday will mostly look to the PMIs for guidance, while Tuesday will see the German IFO Business Climate/ Expectations and some secondary US data (US Case Shiller House Price Index, House Price Index, Consumer Confidence and Richmond Fed Mfg Index), while the RBA Governor Lowe will be speaking, and he will be closely watched for any hint as to the possible timing the next rate cut. Wednesday will feature the RBNZ Interest Rate Decision, at which policy is likely to remain on hold following last months 50bp cut, but a dovish outlook should keep the downside pressure on the Kiwi. Thursday will be the busiest session of the week, with the Q2 GDP (exp 0.8%qq, 2.0%yy) set to be the main event, while also on the agenda will be the US Wholesale Inventories, Personal Consumption/Expenditure, Pending Home Sales, Kansas Fed Mfg Activity and the weekly Jobless Claim. Friday will look to the US Durable Goods Orders for guidance, while the Michigan Consumer Sentiment Index will also be released. Have a good week.
Economic data highlights will include:
Mon: Australian CBA Mfg/Services/Composite PMIs, Japan Holiday, EU/US Mfg/Services/Composite PMIs, Chicago Fed National Activity Index, Fed’s Williams Speech
Tue: Nikkei Japan Mfg PMI, German IFO Business Climate/Expectations, BuBa Monthly Report, UK Public Sector Net Borrowing Requirements, CBI Distributive Trade Survey – Orders, RBA’s Lowe Speech, US Case Shiller House Price Index, House Price Index, Consumer Confidence, Richmond Fed Mfg Index, API Weekly Crude Oil Stock Inventory
Wed: RBNZ Meeting, NZ Trade Balance, BOJ Minutes, CBI Distributive Trade Survey – Realised, SNB Quarterly Bulletin, US New Home Sales, EIA Crude Oil Stocks Weekly Change
Thur: German Consumer Confidence, EU Economic Bulletin, US Q2 GDP, Goods Trade Balance, Wholesale Inventories, US Personal Consumption/Expenditure, Pending Home Sales, Kansas Fed Mfg Activity, Jobless Claims
Fri: Japan Tokyo CPI, EU Economic Sentiment Indicator, Industrial Confidence, Services Sentiment, Business Climate, US Personal Consumption/Expenditure Index, Durable Goods Orders, Michigan Consumer Sentiment Index
Market moves, in brief:
FX: DXY 98.47 (+0.12%)
Bonds: US10Y; 1.724% (-3.66%), German 10Y; -0.52% (-2.68%), UK 10Y; +0.548% (-1.53%), Australian 10Y; 1.025% (-4.10%), NZ 10Y; 1.606% (-2.48 %), China 10Y; 3.096% (-0.64%)
Stock Indices: DJI; -0.59%, S+P; -0.48%, NASDAQ; -0.80%, EUStoxx50; +0.53%, FTSE100; -0.16%, Shanghai Composite; +0.24%,
Metals: Gold $1516 oz (1.19%), Silver $17.96 oz (+0.98%), Copper $2.591 lb (-0.67%), Iron Ore $93.38 per tonne (NYMEX) (-0.67%),
Oil: WTI $58.45 pb (-0.26%)
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