HomeContributorsFundamental AnalysisStocks Drift Sideways Ahead Of Trump-Putin Summit In Helsinki

Stocks Drift Sideways Ahead Of Trump-Putin Summit In Helsinki

Notes/Observations

  • Europe trades slightly higher, while Asia closed lower in quiet trading session
  • Deutsche Bank shares soar over 8% on prelim results
  • Markets await summit between Trump and Putin

Asia:

  • China GDP and Retail Sales comes ahead of forecast, Industrial production misses
  • New Zealand June Performance of Services index hits lowest level since Dec 2012
  • Nikkei closed today for Marine Day

Europe:

  • China and EU leaders have agreed to boost free trade – Joint statement
  • UK government could accept amendments to customs bill – BBC report
  • Tory MP Greening said to call for 2nd UK referendum
  • In interview President Trump spoke of Europe as a Foe saying “I think the European Union is a foe, what they do to us in trade. Now you wouldn’t think of the European Union, but they’re a foe”
  • PM May reveals Donald Trump suggested the UK sue the EU over Brexit
  • Deutsche Bank report prelim Q2 above forecasts, shares rise sharply

Energy

  • US considering tapping strategic Petroleum reserve to curb gasoline prices ahead of fall elections

Economic Data:

  • (DK) Denmark Jun PPI M/M: 1.5% v 1.2% prior; Y/Y: 6.8% v 3.9% prior
  • (IN) India Jun Wholesale Prices (WPI) Y/Y: 5.8% v 5.2%e
  • (TR) Turkey Apr Unemployment Rate: 9.6% v 9.2%e
  • (CH) SNB Total Sight Deposits for Week Ended July 13th
  • (CHF): 576.1B v 576.0B prior
  • (CZ) Czech May Current Account (CZK): -2.2B v -12.0Be
  • (IT) Italy May Trade Balance: €3.4B v €2.9B prior; Trade Balance EU: €1.0B v €1.1B prior
  • (TR) Turkey Jun Central Gov’t Budget Balance (TRY): -25.6B v +2.7B prior

SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM

Equities

  • Indices [Stoxx50 +0.1% at 3,457, FTSE +0.8% at 7,648, DAX -0.2% at 12,549, CAC-40 -0.1% at 5,427; IBEX-35 +0.1% at 9,749, FTSE MIB +0.7% at 220.46, SMI flat at8,864 , S&P 500 Futures +0.1%]
  • Market Focal Points/Key Themes: European indices opened slightly higher and tracked largely sideways as the session wore on; periphery better performers; risk sentiment positive but not voracious; utilities and materials better performers; automotive sector underperforming, dragged by Peugeot; focus on upcoming Trump-Putin meeting later in the day and potential geopolitical concerns; Chile closed for holiday; upcoming earnings expected in the US session include Bank of America, Blackrock and JB Hunt

Equities

  • Consumer discretionary: Debenhams DEB.UK -5.8% (credit insurers reduce cover for supplies), L’Oreal OR.FR -0.5% (analyst action), Lagardere MMB.FR +2.1% (analyst action)
  • Consumer staples: Marine Harvest MHG.NO -2.6% (results)
  • Financials: Deutsche Bank DBK.DE +5.5% (prelim Q2)
  • Healthcare: Cellectis ALCLS.FR +7.5% (analyst action), Indivior INDV.UK 31.9% (prelim injuction on generic)
  • Industrials: OCI OCI.NL +4.1% (analyst action), PSA UG.FR -0.7% (German Transport Min hearing on Opel emissions), VTG VT9.DE +14.5% (3rd party stake sale)
  • Technology: Dialog Semiconductor DLG.DE -2.8% (outlook), Micro Focus MCRO.UK -4.7% (analyst action)
  • Telecom: Megafon MFON.RU +6.6% (approves tender offer)

Speakers

  • (IT) Italy EU Affairs Min Savona: proposes EU to be allowed to spend an extra €50B on public investments
  • (US) President Trump tweets “Received many calls from leaders of NATO countries thanking me for helping to bring them together and to get them focused on financial obligations, both present & future. We had a truly great Summit that was inaccurately covered by much of the media. NATO is now strong & rich!”

Currencies

  • Markets have been quiet in a subdued session with a lack of macro driving factors. Cable recovers from Friday lows as President Trump denied comments published in the press on Friday regarding trade with the UK, branding it as fake news. Cable trades at $1.3248, 10 pips off the session highs.

Fixed Income

  • Bund Futures trade 18 ticks lower at 162.77 as the German Bund yield hovers above 0.30%. Upside targets 163.25 followed by 163.85, while a return lower targets the 159.75 level.
  • Gilt futures trade at 123.35 higher by 27 ticks as Trump’s apologizes to PM May. Support continues stands at 121.75 then 120.25, with upside resistance at 123.85 then 124.25.
  • Monday’s liquidity report showed Friday’s excess liquidity fell from €1.871T to €1.867. Use of the marginal lending facility dropped from €135M to €134M.
  • Corporate issuance saw high grade issuers price $13.6B debt last week

Looking Ahead

  • 07:30 (IN) India Weekly Forex Reserves
  • 08:00 (BR) Brazil May IBGE Services Sector Volume Y/Y: -4.0%e v 2.2% prior
  • 08:00 (IS) Iceland Jun Unemployment Rate: No est v 2.2% prior
  • 08:15 (UK) Baltic Dry Bulk Index
  • 08:30 (US) Jun Import Price Index M/M: 0.1%e v 0.6% prior; Y/Y: 4.6%e v 4.3% prior, Export Price Index M/M: 0.2%e v 0.6% prior; Y/Y: No est v 4.9% prior, Import Price Index ex Petroleum M/M: 0.2%e v 0.1% prior
  • 09:00 (CA) Canada Jun Existing Home Sales M/M: 1.5%e v -0.1% prior
  • 10:00 (US) July Preliminary University of Michigan Confidence: 98.0e v 98.2 prior
  • 11:00 (CO) Colombia May Industrial Production Y/Y: 4.9%e v 10.5% prior
  • 11:00 (CO) Colombia May Retail Sales Y/Y: 5.0%e v 6.3% prior
  • 13:00 (US) Weekly Baker Hughes Rig Count data
  • 14:00 (CO) Colombia Central Bank Jun Minutes
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