Sample Category Title

General Trend:

• China June trade balance expected to be released at approx. 700 GMT (3:00 AM EST)
• China Q2 GDP and June data (including industrial production) due for release on July 15th (Monday)
• Singapore GDP unexpectedly contracted in Q2
• Asian government bond yield track Thursday’s rise in US Treasury yields
• Government officials from Japan and South Korea due to meet on July 12th amid trade dispute

Headlines/Economic Data

Australia/New Zealand

• ASX 200 opened flat
• (NZ) New Zealand Jun Business Manufacturing PMI: 51.3 v 50.4 prior

China/Hong Kong

• Shanghai Composite opened -0.1%, Hang Seng -0.1%
• (CN) China Vice Premier Liu He: Pressures on economy are 'normal;' China to further expand its opening up - Chinese press
• (US) June Los Angeles and Long Beach port complex inbound containers handled were -5.1% y/y, US/China trade dispute noted – financial press
• (CN) China local government financing vehicle (LGFV) Tianjin Binhai said to delay sale of US dollar denominated bonds - US financial press
• (CN) China PBoC Open Market Operation (OMO): Skips for the 15th consecutive; Net drain CNY100B v drain CNY100B prior
• (CN) China PBOC sets yuan reference rate: 6.8662 v 6.8677 prior
• (CN) China June Smartphone Shipments Y/Y: -5.0% v +1.3% prior - China Industry Academy

Japan

• Nikkei 225 opened +0.4%
• (JP) Japan Cabinet Sec Suga: Will review facts with South Korea at meeting [on July 12th] but will not negotiate
• (JP) DRAM prices rebound citing Japan export curbs - Yonhap

Korea

• Kospi opened +0.1%

Other

• (TH) Thailand Central Bank confirms it will issue measures on short-term capital flows: Increases reporting requirements for non-residents' holdings of debt securities
• *(SG) SINGAPORE Q2 ADVANCE GDP Q/Q: -3.4% V +0.5%E (largest contraction in ~ 7 yrs); Y/Y: 0.1% V 1.1%E (slowest annual growth since 2009)

North America

• (US) Fed’s Williams (moderate, voter): the economy is in a good place; recent data is more mixed amid slower job gains and still low inflation
• (US) Fed's Quarles (hawk, voter): US economy is in a strong position based on data; there are some significant risks out there- CNBC interview
• (US) Fed's Brainard (voter, dove): Supports softening the rate path due to risks and low inflation

Europe

• Thomas Cook [TCG.UK]: Announces injection of £750M from Fosun Tourism
• (IR) US has decided not to impose sanctions on Iran at this time, no reason has been initially given for the decision - US Press

Levels as of 1:20 ET

• Nikkei 225, +0.1%, ASX 200 -0.3%, Hang Seng +0.3%; Shanghai Composite +0.4%; Kospi +0.2%
• Equity Futures: S&P500 +0.2%; Nasdaq100 +0.2%, Dax +0.3%; FTSE100 +0.3%
• EUR 1.1273-1.1249 ; JPY 108.61-108.31 ; AUD 0.6994-0.6970 ;NZD 0.6683-0.6657
• Gold +0.2% at $1,409/oz; Crude Oil +0.6% at $60.56/brl; Copper +0.4% at $2.698/lb

Trump blasted Bitcoin and other Crytpocurrencies as they are "not money" with value "highly volatile and based on thin air". He criticized that "unregulated crypto assets can facilitate unlawful behavior, including drug trade and other illegal activity". Also, Facebook's Libra "will have little standing or dependability".

He then hailed the only "real currency" the United States Dollar. He said the USD is "stronger than ever, both dependable and reliable", the "most dominate currency anywhere in the World".

https://twitter.com/realDonaldTrump/status/1149472282584072192

https://twitter.com/realDonaldTrump/status/1149472285905940480

Market movers today

Market focus remains on the probability of forthcoming central bank easing with most prominently rates markets re-adjusting the probability mass between a 25bp (our eventual call) and a 50bp FOMC rate cut at the end of the month.

Today, our eyes will primarily be on Sweden and the Riksbank minutes set for release at 09:30 CEST. As the decision to leave the repo rate path was unanimous, it will be interesting to see how the board has interpreted and processed recent dovish signals from ECB and Fed. We would have assumed at least perma-dove Per Jansson to enter a reservation in light of recent financial developments, but not so. Swedish inflation (and inflation expectations) are still reasonably close to target, which might be one reason for the relative 'hawkishness' of the Riksbank despite looming rate cuts from both Fed and ECB. However, the Swedish economy is poorly insulated against a substantial global downturn and recent Riksbank communication (e.g. Ingves' press conference following the June-meeting) diverges from the ECB narrative, painting a much brighter picture of the global, and especially European, economy. We will therefore scrutinise the minutes for any arguments underpinning that divergence.

In Norway , Norway Statistics publishes Q2 house prices this morning. However, given the close correlation to Real Estate Norway's monthly prints this release should not have any market impact. Overall, the housing market in Norway has been modestly on the rise in 2019 and recently stronger than pencilled in by Norges Bank. This in turn has supported the central bank's signal of a September rate hike, the third this year.

In the euro area, we get a further piece of the puzzle on where GDP growth will arrive in Q2 with the industrial production data for May . The April figures pointed to a weak start for the industrial sector into Q2 and country figures already released paint a mixed picture for May. We still think that the industrial sector will likely have returned as an outright drag on growth in Q2. We also get Chinese trade data for June . Although volatile on a monthly basis, markets will scrutinise these data for indications of the state of Chinese and global demand ahead of the trade truce reached at the end of June.

Selected market news

This morning most Asian equity indices are modestly higher despite trade war concerns resurfacing (see below) and US core CPI dampening speculations of a 50bp FOMC rate cut at the end of this month. 2Y swap rates have erased roughly half of the decline triggered by Fed Chair Powell's first part of his semi-annual policy testimony on Wednesday leaving a roughly 18% probability of a 50bp cut (82% for 25bp). While we ultimately expect a 25bp cut, we think it is fair that markets price a non-zero probability of a larger cut.

Late in yesterday's European session, US President Trump lashed out at China on Twitter for ' letting us down in that they have not been buying the agricultural products from our great Farmers that they said they would'. According to US officials, China promised to step up US farm product purchases at the G20 summit last month as an important part of securing the trade truce. Chinese state media, however, report that no official deal on farm products was reached at the summit. Meanwhile, the first high-level trade negotiations between China and the US re-started this week.

For the 24 hours to 23:00 GMT, the EUR slightly declined against the USD and closed at 1.1256.

The European Central Bank, in the account of its latest policy meeting, indicated its readiness to provide fresh stimulus to the economy either by way of rate cuts or commencement of new asset purchase programs. Also, the minutes highlighted ECB’s concerns about the growth and inflation outlook.

Separately, in Germany, the final consumer price index (CPI) climbed 0.3% on monthly basis in June, meeting market consensus and confirming the preliminary figures. In the preceding month, the CPI had recorded to a rise of 0.2%.

The US dollar gained ground against its peers, on the back of upbeat US inflation data.

In the US, data showed that the consumer price index (CPI) rose 1.6% on an annual basis in June, rising by the most in 1.5 years and in line with market expectations. In the prior month, the CPI had registered a gain 1.8%. Moreover, the nation’s seasonally adjusted initial jobless claims eased to a 3-month low level of 209.0K in the week ended 06 July 2019, overshooting market expectations for a drop to a level of 221.0K. Initial jobless claims had registered a revised reading of 222.0K in the previous week.

On the other hand, the US budget deficit narrowed to $8.5 billion in June, compared to market anticipation for a deficit of $7.9 billion. The nation had posted a deficit of $207.8 billion in the prior month.

In the Asian session, at GMT0300, the pair is trading at 1.1267, with the EUR trading 0.10% higher against the USD from yesterday’s close.

The pair is expected to find support at 1.1246, and a fall through could take it to the next support level of 1.1225. The pair is expected to find its first resistance at 1.1287, and a rise through could take it to the next resistance level of 1.1307.

Going ahead, traders would await the Euro-zone’s industrial production for May, slated to release in a few hours. Later in the day, the US producer price index for June, will garner significant amount of investors’ attention.

The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average

For the 24 hours to 23:00 GMT, the GBP rose 0.15% against the USD and closed at 1.2528.

The Bank of England (BoE), in its semi-annual Financial Stability Report (FSR), warned that the increasing likelihood of a no-deal Brexit could cause massive disruption to the UK economy. Additionally, the report highlighted a gloomy outlook for the UK economy, citing no-deal Brexit risks and trade tensions. However, the BoE indicated that UK’s banks, dealers and insurers are prepared for ‘a worst-case disorderly Brexit’.

In the Asian session, at GMT0300, the pair is trading at 1.2537, with the GBP trading 0.07% higher against the USD from yesterday’s close.

The pair is expected to find support at 1.2506, and a fall through could take it to the next support level of 1.2474. The pair is expected to find its first resistance at 1.2570, and a rise through could take it to the next resistance level of 1.2602.

Looking forward, traders would keep an eye on the UK’s Rightmove house price index, average weekly earnings and the ILO unemployment rate, all set to release next week.

The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.

For the 24 hours to 23:00 GMT, the USD rose 0.12% against the JPY and closed at 108.48.

In economic news, Japan's final industrial production fell 2.1% on an annual basis in May, more than market expectations for a drop of 1.8%. In the previous month, industrial production had registered a drop of 1.1%.

In the Asian session, at GMT0300, the pair is trading at 108.38, with the USD trading 0.09% lower against the JPY from yesterday's close.

The pair is expected to find support at 107.96, and a fall through could take it to the next support level of 107.53. The pair is expected to find its first resistance at 108.71, and a rise through could take it to the next resistance level of 109.03.

In absence of key economic releases in Japan today, investor sentiment would be determined by global macroeconomic events.

The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the USD rose 0.15% against the CHF and closed at 0.9898.

In the Asian session, at GMT0300, the pair is trading at 0.9896, with the USD trading slightly lower against the CHF from yesterday’s close.

The pair is expected to find support at 0.9859, and a fall through could take it to the next support level of 0.9823. The pair is expected to find its first resistance at 0.9920, and a rise through could take it to the next resistance level of 0.9945.

With no macroeconomic releases in Switzerland today, investors would look forward to global macroeconomic releases for further direction.

The currency pair is trading above its 20 Hr moving average and showing convergence with its 50 Hr moving average.

For the 24 hours to 23:00 GMT, the USD declined 0.06% against the CAD and closed at 1.3068.

Data showed that Canada's new housing price index remained flat on an annual basis in May, defying market anticipations for a climb of 0.2%. The index had advanced 0.1% in the previous month.

In the Asian session, at GMT0300, the pair is trading at 1.3039, with the USD trading 0.22% lower against the CAD from yesterday's close.

The pair is expected to find support at 1.3020, and a fall through could take it to the next support level of 1.3001. The pair is expected to find its first resistance at 1.3075, and a rise through could take it to the next resistance level of 1.3111.

Moving forward, traders would closely monitor Canada's existing home sales, retail sales, manufacturing sales and consumer price index, all scheduled to release next week.

The currency pair is trading below its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the AUD rose 0.14% against the USD and closed at 0.6974.

LME Copper prices rose 2.1% or $120.0/MT to $5925.0/MT. Aluminium prices declined 0.2% or $4.0/MT to $1807.0/MT.

In the Asian session, at GMT0300, the pair is trading at 0.6986, with the AUD trading 0.17% higher against the USD from yesterday’s close.

The pair is expected to find support at 0.6968, and a fall through could take it to the next support level of 0.6950. The pair is expected to find its first resistance at 0.6997, and a rise through could take it to the next resistance level of 0.7008.

Going ahead, investors would await the Reserve Bank of Australia’s meeting minutes along with unemployment rate, slated to release next week.

The currency pair is trading above its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, Gold declined 1.04% against the USD and closed at USD1407.00 per ounce.

In the Asian session, at GMT0300, the pair is trading at 1410.10, with gold trading 0.22% higher against the USD from yesterday’s close.

The pair is expected to find support at 1399.47, and a fall through could take it to the next support level of 1388.83. The pair is expected to find its first resistance at 1423.97, and a rise through could take it to the next resistance level of 1437.83.

The yellow metal is trading below its 20 Hr and 50 Hr moving averages.