Global market wrap: becalmed despite G7 discord - ANZ

Analysts at ANZ explained that ahead of a major week for central bank meetings, key data releases and the US-North Korea Summit today, financial markets were becalmed despite the G7 discord post last Saturday’s communique. 

Key Quotes:

"Trade uncertainty remains a major concern, but markets had a risk on tone. That may have been a function of low volumes ahead of the Fed and ECB this week as asset allocators are unlikely to make strategic investment decisions until those events and the Singapore Summit are out of the way."

"The Fed is expected to raise rates 25bps and indicate one more rate rise this year."

"The ECB is expected to acknowledge the recent soft patch in growth but nonetheless signal that QE should end in Q4, a decision that is underpinned by an improving underlying inflation performance (services inflation has risen steadily to 1.6% y/y vs 1.2% in January)."

"Equities rallied. The DAX rose 0.6%, the CAC rose 0.4% and the FTSE 100 rose 0.7%. At the time of writing, the S&P was up 0.3%."

"Bonds were little changed with the yield on the US 10-yr note at 2.96%."

"Yields on Italian bonds fell sharply with the spread over bunds easing back to 234bps as Finance Minister Tria indicated that fiscal policy will not become unruly."

"Oil was steady with WTI rising 0.6% to $66.10/bbl and Brent unchanged at $76.5/bbl."