US stock markets pushed higher once again on Tuesday, ending up by around 0.8%/1.8% on the day and allowing the S+P to complete its biggest quarterly percentage gain of 20%, since 1998, as improving economic data underpinned the hope that a stimulus-backed rebound for the US economy maybe on the horizon. The rally came about despite the leading US public health expert stating that the US is “sliding backwards on its handling of the coronavirus pandemic” and that he “would not be surprised to see 100,000 new cases per day in the near future”. The US$ has been choppy and mixed, with the DXY ending the session down by just 0.1%. Early European dollar strength has since largely been reversed, and the Aud and Nzd in particular, have ended the day on a strong note albeit well within their recent respective ranges. The Jpy remains under some downside pressure while stock markets continue to grind higher.
The commodities markets were generally positive with Silver (+ 1.9%) and Copper (+1.85%) both having good days. Gold, Iron Ore and WTI also headed a bit higher too, mostly by around 0.5%.
Federal Reserve Chairman Jerome Powell was testifying before the House Financial Services Committee, and stated that a second wave of the coronavirus outbreak could “force government and people to withdraw again from economic activity which would undermine public confidence, which is what we need to get back to lots of economic activity.”
In terms of data, the US consumer confidence gauge rose to 98.1 I June, from 85.9 in May, beating forecasts of a reading of 90.8.
Wednesday will mostly be about the global Manufacturing PMIs, beginning with Australia, and moving on to Japan, China (Caixin), UK, EU, US (ISM Mfg PMI/Prices Paid), but there will be other points on the agenda as well. Building Permits will be released from both NZ (exp -0.1%mm) and Australia (exp -10%mm), while the other main event in Asia will by the Q2 Japan Tankan. From German we get the May Retail Sales (exp +3.9%mm, -3.5%yy) and then from the US, aside from the ISM data, the focus will be on the FOMC Minutes, the ADP Jobs data (exp +3.0mio) and the EIA Weekly Crude Stocks Change. It could be a volatile end to the session, so have a good day.
Economic data highlights will include:
Wed: NZ Building Permits, Australian AIG/CBA Mfg PMIs, Building Permits, Japan Tankan, Japan Mfg PMI, China Caixin China Manufacturing PMI, Japan Consumer Confidence, German Retail Sales, Unemployment , EU/UK Mfg PMIs, US ISM Mfg PMI/Prices Paid, ADP Jobs data, FOMC Minutes, EIA Weekly Crude Stocks Change
Market moves, in brief:
FX: DXY 97.37 (-0.10%)
Bonds: US10Y; 0.465% (+4.9%), German 10Y; -0.455% (+3.09%), UK 10Y; 0.169% (+8.6%), Australian 10Y; 0.879% (-1.66%), NZ 10Y; 0.939% (+2.02 %), China 10Y; 2.892% (-0.71%)
Stock Indices: DJI; +0.85%, S+P; +1.54%, NASDAQ; +1.85%, EUStoxx50; +0.06%, FTSE100; -0.90%, Shanghai Composite; +0.78%, ASX200: +0.18%
Metals: Gold $1780 oz (+0.46%), Silver $18.18 oz (+1.94%), Copper $2.7150 lb (1.32%), Iron Ore $98.45 per tonne (NYMEX) (+0.87%),
Oil: WTI $39.80 (+0.43%)
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