Market movers today

  • In the US, it will be interesting to see whether core capex orders for May show the same signs of weakness as PMIs as of late.

  • We also get a first glimpse of how German consumer sentiment has started into Q3 on an otherwise quiet day on the European data front ahead of tomorrow's and Friday's inflation figures.

  • A range of Bank of England MPC members, including Governor Carney, will testify before the UK Parliament Treasury Committee.

  • The EIA will publish its weekly oil inventories report today. The market will likely be on the lookout for at large drop in crude stocks after API yesterday reported a 7.6mb drop in crude stocks last week.

  • In Scandinavia, Norwegian unemployment data and Danish retail sales will be in focus.


Selected market news

The range of Fed speeches yesterday resulted in slightly higher short-term USD rates and a stronger USD. In particular, the market took note of comments from St. Louis Fed's Bullard, who argued for an insurance cut, but that 50bp would be overdone. Fed Chair Powell reiterated his message from the previous FOMC meeting, while adding that it is important not to overreact in the short term.

According to a Senior US administration official, US President Trump and Chinese President Xi Jinping could agree to restart trade talks when they likely meet this weekend at the G20 meeting in Japan.

In Denmark, the Social Democrats have reached an agreement with their three coalition parties to form a one-party government.

The Reserve Bank of New Zealand kept rates unchanged yesterday, but signalled that a further reduction in interest rates may be needed due to both slowing global and domestic growth.

Oil prices rose late yesterday, with Brent crude jumping above USD66/bbl. The market reacted to the news that API reported a 7.6mb drop in crude stocks last week. Oil inventories also dropped in May, when the market took it as a signal of weaker demand. However, the market reaction to these numbers suggests the market may now be more concerned about tighter supply.

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