Wednesday 8th July: European Open Briefing

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Global Markets:

  • Asian stock markets: Nikkei down 1.50 %, Shanghai Composite lost 5.00 %; Hang Seng declined 4.10 %, ASX fell 1.65 %
  • Commodities: Gold at $1152 (-0.05 %), Silver at $14.85 (-0.80 %), WTI Oil at $52.09 (-0.50 %), Brent Oil at $56.50 (-1.50 %)
  • Rates: US 10 year yield at 2.22, UK 10 year yield at 1.84, German 10 year yield at 0.65

News & Data:

  • Japan Current Account ¥1.88trln, Expected: ¥1.54trln, Previous: ¥1.33trln
  • Japan Adjusted Current Account ¥1.64trln, Expected: ¥1.38trln, Previous: ¥1.27trln
  • Japan Bank Lending 2.5 % y/y, Previous: 2.6 %
  • PBOC say they will support stock market, monitoring movements closely, to assist with liquidity: BBG
  • 43% of entire Chinese stocks frozen in a bid to avoid the rout – also seen margin requirements raised today
  • Juncker says the commission has prepared fa Grexit scenario plan in detail; also has humanitarian plan: BBG
  • Euro zone gives Greece until Sunday for debt deal – RTRS
  • Slumping China stocks pull down Asian markets, boost safe-haven yen – RTRS
  • Oil prices fall as China share crisis worsens, outweighs expected U.S. stock draw – RTRS

Markets Update:

In FX, the risk-off sentiment remains persistent, with the JPY and USD bid, while the commodity currencies are under pressure. The EU is losing its patience with Greece and have stated that a Grexit is unavoidable if there is no deal until the end of this week. Meanwhile, the chaos in Chinese stock markets continues, adding to the risk averse sentiment. The Shanghai Composite was down 8 % at one point today and around 43 % of the market is frozen, with traders/investors unable to buy or sell the affected shares. Precious metals crashed in yesterday’s NY session. Gold fell from $1167 to a low of $1148. It has bounced from there and is currently consolidating around $1153. The bigger move has been seen in Silver, which fell more than 6 % on the day.

Looking ahead, the economic calendar is very light for today. There are no data releases or scheduled events during the European session at all, so traders will be waiting for the only notable event – the FOMC minutes at 19:00 (UK Time).

Upcoming Events:

  • 13:30 BST – Canadian Building Permits
  • 19:00 BST – FOMC Meeting Minutes


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