- Safe-haven flows continue to percolate as Persian Gulf tensions simmer

- China May Industrial Production data hits a 17-year low (YoY: 5.0% v 5.4%e); Retail Sales rebounds YoY: 8.6% v 8.1%e); concerns that China would need to introduce more fiscal stimulus to ensure 2019's GDP growth


- Hong Kong lawmakers said to be open to extending extradition bill debate


- European Finance Ministers (Eurogroup) reportedly plan easier restructuring of euro zone sovereign bonds with maturities longer than 1-year, starting in 2022


- President Trump tweet: While I very much appreciate Japan PM Abe going to Iran to meet with Ayatollah Ali Khamenei, I personally feel that it is too soon to even think about making a deal. They are not ready, and neither are we! - White House Econ Adviser Kudlow reiterated USMCA could provide as much as 0.5% to GDP when fully implemented. USMCA had a more powerful impact on the economy than trade issues with China


- US Sec of State Pompeo stated that Iran was responsible for recent tanker attacks as the country continued to actively work to interrupt flow of oil. Unprovoked attacks were part of campaign to escalate tension because they wanted US sanctions to be lifted

- US Navy Destroyer USS Mason heading to Gulf of Oman to scene of attacks on oil tankers

- Iran Mission to UN rejected US claims as "unfounded" regarding the Gulf of Oman tanker attacks

- Saudi Energy Min: international community must take responsibility and protect international shipping lanes




Indices [Stoxx600 -0.48% at 378.49, FTSE -0.28% at 7,347.84, DAX -0.65% at 12,090.02, CAC-40 -0.26% at 5,361.76, IBEX-35 -0.48% at 9,203.00, FTSE MIB -0.32% at 20,564.50, SMI +0.14% at 9,852.3, S&P 500 Futures -0.24%]

Market Focal Points/Key Themes: European Indices trade mostly lower following continued political tensions after the attack in the Persian Gulf. Asian Indices were mainly lower while US index futures also trade lower. The Nasdaq underperforms after a Revenue miss from Broadcom weighed on the tech sector with shares of AMS, Dialogue Semi and Infineon among the names declining in sympathy. On the earnings front Sthree trades high after a 9% rise in Net fees; GL Events also gains after raising its outlook, with Prysmian another riser after affirming its outlook. In other news Transgene declines following a rights issue; Kier group falls over 15% on talk some credit insurers are withdrawing cover protecting suppliers, while Faron Pharma gains following the final results from its YODA study. Looking ahead notable earners include Cheetah Mobile and China Online Education.



- Consumer discretionary: Ascential [ASCL.UK] -2% (trading update), Sthree [STHR.UK] +1.5% (trading update), Straumann [STMN.CH] -2% (abandons collaboration)

- Healthcare: Faron Pharmaceuticals [FARN.UK] +22% (study update)

- Industrials: KIER Group [KIE.UK] -13% (proposed divestment), Grippo Sias [SIS.IT] -3%, ASTM [AT.IT] +3% (merger)

- Technology: Infineon [IFX.DE] -2%, Dialog Semiconductor [DLG.DE] -2%, AMS [AMS.CH] -6.5%, STMicroelectronics [STM.FR] -3% (Broadcom earnings)



- ECB's Draghi letter to EU parliament: Overall effect of our monetary policy on bank profitability had so far been broadly neutral

- France Fin Min La Maire: EU Ministers agreed to Euro Zone budget. Budget accord to help the region face crisis. Euro Area budget reform still had a long way to go

- Eurogroup chief Centeno commented that Euro Zone budget size to be determined by EU Leaders later in 2019 as more work was needed to define sources for financing

- Italy Dep PM Salvini (League): 2020 Budget must have substantial tax cuts. Reiterated that EU fiscal rules outdated EU finance ministers (EcoFin) commented ahead of meeting in Luxembourg

- EU's Moscovici: Welcomed the commitments from Italy PM Conte and Fin Min Tria but would need more than commitments from Italy. Stressed that the Italian numbers must add up for 2019 and 2020

- EU's Dombrovskis: More work was needed on funding for Euro budget. Up to Italy to correct its fiscal trajectory

- Italy Fin Min Tria: Mini-bots were a bad idea

- Poland Central Bank's Osiatynski reiterated MPC view that would not raise interest rates in 2019 but saw a chance for a 2020 hike. Saw inflation acceleration but remaining within target

- Turkey Foreign Min Cavusoglu stated that was ready to retaliate to any US sanctions over its purchase of the Russian S-400 missile-defense system

- National Bureau of Statistics (NBS) spokesperson Fu Linghui: Month-to-month data fluctuations is normal; external uncertainties are increasing

- IEA Monthly Oil Report cut its 2019 global oil demand growth forecast from 1.3M bpd to 1.2Mbpd and set 2020 global oil demand growth at 1.4M bpd. Maintained 2019 Non-Opec supply growth at 1.9M bpd and set 2020 Non-Opec supply growth at 2.3M bpd


Currencies/Fixed Income

-USD: The US Dollar index futures traded sideways with very little volatility as the market looks to next week's FOMC meeting where we could see a bit of movement.

-EUR: The Euro traded lower below 1.13 as the EU stressed the need for Italy to follow the rules regarding fiscal policy. We see the upside levels in the region of 1.1340 and the downside in the region of 1.1120. Next week is a fairly quiet week for the Euro until the end of the week when we have flash PMI figures or we could see further comments regarding EU and Italy come out.

-GBP: The cable traded lower as the first round of voting in the Parliament for the Tory leadership began with Boris taking the most votes and Jeremy Hunt took second place with 43. This was as expected, but in the next few weeks things could get shook up a bit if Boris Johnson loses votes to hunt. To the upside we see levels in the 1.2750 region and to the downside we have 1.26 handle. Next week could see some volatility as we have BOE and CPI economic indicators due out.


Economic Data

- (NL) Netherlands Apr Trade Balance: €4.2B v €5.3B prior

- (NL) Netherlands Apr Retail Sales Y/Y: 4.7% v 1.1% prior

- (FI) Finland May CPI M/M: -0.2%e v +0.6% prior; Y/Y: 1.2% v 1.5% prior

- (FI) Finland Apr Current Account Balance: -€4.2B v -€0.2B prior

- (FI) Finland Apr GDP Indicator WDA Y/Y: 2.8% v 0.9% prior

- (DE) Germany May Wholesale Price Index: M/M: 0.3% v 0.6% prior; Y/Y: 1.6% v 2.1% prior

- (IN) India May Wholesale Prices (WPI) Y/Y: 2.5% v 3.0%e

- (FR) France May Final CPI M/M: 0.1% v 0.2%e; Y/Y: 0.9% v 1.0%e; CPI Ex-Tobacco Index: 103.86 v 103.76 prior

- (FR) France May Final CPI EU Harmonized M/M: 0.1% v 0.2%e; Y/Y: 1.0% v 1.1%e

- (TR) Turkey Apr Current Account Balance: -$1.3B v -$1.5Be

- (CN) China May Industrial Production Y/Y: 5.0% v 5.4%e (weakest reading since 2002); Industrial Production YTD Y/Y: 6.0% v 6.1%e

- (CN) China May Retail Sales Y/Y: 8.6% v 8.1%e; Retail Sales YTD Y/Y: 8.1% v 8.0%e

- (CN) China May Fixed Urban Assets Y/Y: 5.6% v 6.1%e

- (CN) China May YTD Surveyed Jobless Rate: 5.0% v 5.0% prior

- (CN) China May YTD Property Investment Y/Y: 11.2% v 11.9% prior

- (SE) Sweden May CPI M/M: 0.3% v 0.1%e; Y/Y: 2.2% v 2.0%e; CPI Level: # v 334.11 prior

- (SE) Sweden May CPIF M/M: 0.3% v 0.1%e; Y/Y: 2.1% v 1.9%e

- (SE) Sweden May CPIF M/M: 0.3% v 0.1%e; Y/Y: 1.7% v 1.5%e

- (RU) Russia Narrow Money Supply w/e Jun 7th (RUB): 10.34T v 10.24T prior

- (PL) Poland May Final CPI M/M: 0.2% v 0.2%e; Y/Y: 2.4% v 2.3%e

- (IT) Italy Apr Industrial Sales M/M: -1.0%% v +0.4% prior; Y/Y: -0.7% v +1.3% prior

- (IT) Italy Apr Industrial Orders M/M: -2.4% v +2.1% prior; Y/Y: -0.2% v -3.8% prior

- (HK) Hong Kong Q1 Industrial Production Y/Y: 1.4% v 1.2% prior

- (HK) Hong Kong Q1 PPI Y/Y: 0.8% v 0.3% prior

- (IS) Iceland May International Reserves (ISK): 767B v 756B prior

- (IT) Italy May Final CPI M/M: 0.0 v 0.1% prelim; Y/Y: 0.8% v 0.9% prelim; CPI Index (Ex-tobacco): 102.7 v 102.6 prior

- (IT) Italy May Final CPI EU Harmonized M/M: No est v 0.1% prelim; Y/Y: 0.9%e v 0.9% prelim

**Fixed Income Issuance**

- None seen


Looking Ahead

- (UK) Economic and Financial Dialogue (EFD) between UK and China in London

- 05:30 (IN) India to sell combined INR170B in 2021, 2026, 2033, 2039 and 2059 bonds

- 06:00 (IE) Ireland Apr Trade Balance: No est v €4.1B prior

- 06:00 (PT) Poland May Final CPI M/M: No est v 0.1% prelim; Y/Y: No est v 0.5% prior

- 06:00 (PT) Poland May Final CPI EU Harmonized M/M: No est v 0.3% prelim; Y/Y: No est v 0.4% prior

- 06:00 (UK) DMO to sell €5.0B in 1-month, 3-month and 6-month bills £0.5B, £1.5B and £2.5B respectively)

- 06:30 (RU) Russia Central Bank (CBR) Interest Rate Decision: Expected to cut Key 1-Week Auction Rate by 25bps to 7.50%

- 07:00 (IL) Israel May CPI M/M: 0.5%e v 0.3% prior; Y/Y: 1.3%e v 1.3% prior

- 07:00 (BR) Brazil Jun FGV Inflation IGP-10 M/M: 0.4%e v 0.7% prior

- 07:30 (TR) Turkey Central Bank TCMB Survey of Expectations Next 12 Months: No est v 15.5% prior

- 07:30 (IN) India Weekly Forex Reserves w/e Jun 7th: No est v $421.9B prior

- 08:00 (IS) Iceland May Unemployment Rate: No est v 3.7% prior

- 08:00 (UK) Daily Baltic Dry Bulk Index

- 08:00 (RU) Russia Central Bank (CBR) Gov Nabiullina post rate decision press conference

- 08:00 (IN) India announces upcoming bill issuance (held on Wed)

- 08:00 (ES) Spain Debt Agency (Tesoro) a announces upcoming issuance

- 08:30 (UK) May Advance Retail Sales M/M: +0.6%e v -0.2% prior; Retail Sales (Ex-auto) M/M: 0.4% v 0.1% prior; Retail Sales (Ex-auto/gas): +0.4%e v -0.2% prior; Retail Sales Control Group: 0.4%e v 0.0% prior

- 08:55 (UK) BOE Gov Carney in London

- 09:00 (CA) Canada May Existing Home Sales M/M: No est v 3.6% prior

- 09:00 (BE) Belgium Apr Trade Balance: No est v -€0.6B prior

- 09:15 (US) May Industrial Production M/M: +0.2%e v -0.5% prior; Capacity Utilization: 78.0%e v 77.9% prior; Manufacturing Production: +0.2%e v -0.5% prior

- 10:00 (US) Jun Preliminary University of Michigan Confidence: 98.0e v 100.0 prior

- 10:00 (US) Apr Business Inventories: 0.5%e v 0.0% prior

- 11:00 (CO) Colombia Apr Industrial Production Y/Y: 2.0%e v 3.2% prior

- 11:00 (CO) Colombia Apr Retail Sales Y/Y: 4.7%e v 5.3% prior

- 11:00 (EU) Potential sovereign ratings after European close (Moody's on Norway)

- 13:00 (US) Weekly Baker Hughes Rig Count

All information provided by Trade The News (a product of Trade The News, Inc. "referred to as TTN hereafter") is for informational purposes only. Information provided is not meant as investment advice nor is it a recommendation to Buy or Sell securities. Although information is taken from sources deemed reliable, no guarantees or assurances can be made to the accuracy of any information provided. 1. Information can be inaccurate and/or incomplete 2. Information can be mistakenly re-released or be delayed, 3. Information may be incorrect, misread, misinterpreted or misunderstood 4. Human error is a business risk you are willing to assume 5. Technology can crash or be interrupted without notice 6. Trading decisions are the responsibility of traders, not those providing additional information. Trade The News is not liable (financial and/or non-financial) for any losses that may arise from any information provided by TTN. Trading securities involves a high degree of risk, and financial losses can and do occur on a regular basis and are part of the risk of trading and investing.

Analysis feed

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Analysis

Latest Forex Analysis

Editors’ Picks

EUR/USD challenges weekly highs is a sentiment-driven advance

The financial markets continue to focus on sentiment instead than on data, with equities leading the way. Upbeat earnings reports overshadow coronavirus-related concerns. EUR/USD nearing June monthly high at 1.1422.


GBP/USD trims intraday losses, trades flat around 1.2550

The US session is seeing the dollar gave up early gains, even against the weakened Pound. GBP/USD hovers around 1.2550, despite disappointing UK GDP.


Gold advances to fresh daily highs near $1,810

The XAU/USD pair closed the first day of the week with small gains above $1,800. After spending the European session moving sideways in a tight channel, the pair turned north on broad USD weakness during the American session. 

Gold News

Bitcoin low volatility indicates a significant move to $8,000 or $10,000 is nearby

Bitcoin price is currently at $9,229 after a brief dip to $9,104. It is currently below the daily 12-EMA and the 26-EMA which have been unable to cross positively due to the lack of bullish continuation. 

Read more

WTI Oil Outlook: Concerns of slowdown in global demand recovery pressure oil price

WTI oil remains at the back foot on Tuesday and establishes below $40 level, as sentiment weakened on news of new restrictions in California due to increased number of infections.

Oil News

Forex Majors