Monday 27th June: European Open Briefing

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Global Markets:

  • Asian stock markets: Nikkei up 1.85 %, Shanghai Composite gained 0.80 %, Hang Seng fell 0.80 %, ASX 200 rose 0.60 %
  • Commodities: Gold at $1328 (+0.40 %), Silver at $17.72 (-0.50 %), WTI Oil at $47.40 (-0.50 %), Brent Oil at $48.90 (-0.30 %)
  • Rates: US 10 year yield at 1.50, UK 10 year yield at 1.09, German 10 year yield at -0.03

News & Data:

  • New Zealand Trade Balance (NZD) May: 358m (est. 182m, rev prev. 326m from 292m)
  • New Zealand Exports (NZD) May: 4.57b (est. 4.31b, prev. 4.30b)
  • New Zealand Imports (NZD) May: 4.22b (est 4.15b, rev prev. 3.98b)
  • USD/CNY mid-point set at 6.6375 (prev. fix 6.5776, prev close 6.6260) weakened by 0.9%, most since August 2014
  • Japan PM Abe: Large market movements were seen after Brexit vote, uncertainty remains
  • Japan PM Abe: Told FinMin (Aso) to take necessary action in FX markets, important for G7 to continue to send message to stabilise markets
  • Japan PM Abe: Expects BoJ to take steps to sustain market liquidity and financial intermediation
  • Japan FinMin Aso: Was instructed by Abe to take various and aggressive responses to financial and FX markets
  • IMF's Lagarde: Markets vastly underestimated Brexit, cannot see room for revision of decision
  • China 2016 real GDP growth may slow to 6.6%: China Securities Journal

CFTC Positioning Data:

  • EUR short 77k vs 68k prior
  • GBP short 51k vs 34k
  • JPY short 53k vs 56k prior
  • CHF long 6k vs 6k prior
  • AUD short 6k vs 6k prior
  • CAD long 5k vs 20k prior
  • NZD short 3k vs 4k prior

Markets Update:

GBP/USD opened almost 2 % lower on Sunday, at 1.3440, compared to Friday's close at 1.3650. Markets are still pondering about the impact of the Brexit last week and uncertainty remains high, which means that volatility is very likely to stay at elevated levels in the coming weeks. EUR/GBP started the new trading week at 0.82, up 100 pips from Friday's close, while GBP/JPY gapped 250 pips lower.

EUR/USD fell at the open as well, as it started at 1.1020, down roughly 70 pips from Friday's close. USD/JPY caught a bid in the early session as Japanese officials warned that they will take action if the JPY strengthens sharply, but it later reversed all of it gains and fell back to 101.60.

AUD and NZD fell amid the risk-off sentiment in markets and are both down almost 1 % on the day against the US Dollar.

Upcoming Events:

14:45 BST – US Services PMI

The Week Ahead:

Tuesday, June 28th

  • 13:30 BST – US GDP
  • 15:00 BST – US CB Consumer Confidence
  • 15:00 BST – US Richmond Manufacturing Index

Wednesday, June 29th

  • 02:00 BST – Australia HIA New Home Sales
  • 07:00 BST – German GfK Consumer Climate
  • 08:00 BST – Spanish CPI
  • 10:00 BST – Euro Zone Consumer Confidence
  • 13:00 BST – German CPI
  • 13:30 BST – US Personal Income
  • 13:30 BST – US Personal Spending
  • 15:00 BST – US Pending Home Sales
  • 15:30 BST – US Crude Oil Inventories

Thursday, June 30th

  • 00:50 BST – Japan Industrial Production
  • 07:00 BST – German Retail Sales
  • 07:45 BST – French CPI
  • 08:55 BST – German Unemployment Rate
  • 08:55 BST – German Unemployment Change
  • 09:30 BST – UK GDP
  • 10:00 BST – Italian CPI
  • 10:00 BST – Euro Zone CPI
  • 12:30 BST – ECB Meeting Minutes
  • 13:30 BST – Canadian GDP
  • 14:45 BST – US Chicago PMI

Friday, July 1st

  • 00:30 BST – Japan CPI
  • 00:30 BST – Japan Household Spending
  • 00:30 BST – Japan Unemployment Rate
  • 00:50 BST – Japan Tankan Large Manufacturers Index
  • 02:00 BST – China Manufacturing PMI
  • 02:45 BST – China Caixin Manufacturing PMI
  • 08:15 BST – Swiss Retail Sales
  • 08:45 BST – Italian Manufacturing PMI
  • 08:50 BST – French Manufacturing PMI
  • 08:55 BST – German Manufacturing PMI
  • 09:00 BST – Euro Zone Manufacturing PMI
  • 09:30 BST – UK Manufacturing PMI
  • 10:00 BST – Euro Zone Unemployment Rate
  • 14:45 BST – US Markit Manufacturing PMI
  • 15:00 BST – US ISM Manufacturing PMI
  • 16:00 BST – FOMC Member Mester speaks

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