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TradeTheNews.com EU Mid-Market Update: Euro consolidates recent gains vs US dollar; JPY supported by declines in equities
Tue, 09 Jun 2015 5:16 AM EST
***Notes/Observations***
Peripheral spreads pare tightening amid reports that International creditors have concerns about Greek proposal
Euro consolidates recent gains vs. US dollar
EUR/GBP continues to gain as Gilt/Bund spread tightens
Japanese Yen trades firmer amid weakness in equities
NZD underperforms ahead of Wednesday's RBNZ rate decision
Nikkei has biggest daily loss since late April
**Economic data***
(UK) APR VISIBLE TRADE BALANCE: -£8.6B V -£9.9BE; OVERALL TRADE BALANCE: -£1.2B V -£2.6BE
(EU) EURO ZONE Q1 GDP (SECOND EST) Q/Q: 0.4% V 0.4%E; Y/Y: 1.0% V 1.0%E
(CH) SWISS MAY CPI M/M: 0.2% V 0.1%E; Y/Y: -1.2% V -1.3%E
Fixed Income:
(NL) NETHERLANDS DEBT AGENCY (DSTA) SELLS €2.99B V €2.5-3.5Be 2018 DSL BONDS Avg Yield -0.032% v -0.129% prior
(DE) Germany Debt Agency launches 30-year I/L Bund syndicate
*** SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM ***
**Equities**
Indices [Stoxx50 -0.7%, FTSE 100 -0.2% at 6,774, DAX -1.1%, CAC-40 -0.8% at 4,824, IBEX-35 -0.5% at 10,864, FTSE MIB -0.5% at 22,533, SMI -0.6% at 9,004, Athens Stock Exchange +2.7%, S&P 500 Futures flat at 2,077]
Market Focal Points/Key Themes: Equity markets open lower following Monday's declines; HSBC confirms large headcount reduction
By Sector
Financials [HSBC HSBA.UK -0.5% (issued strategy update)]
Basic Resources/Materials [Vedanta Resources VED.UK +5.5% (merger speculation)]
Stoxx50 Sectors [Utilities -0.5%, Technology -0.4%, Consumer Non-Cyclical -0.3%, Industrials -0.2%, Energy -0.1%; Basic Materials +0.5%, Telecom +0.4%, Financials +0.4%, Consumer Cyclical +0.2%]
**Speakers**
(GR) Greece PM Tsipras: To discuss deal timeframe in talks on Wed - Italian Press
(TR) Turkey Opposition MHP Party: Any coalition is out of the question
**Currencies***
-EUR/USD is strong today up almost 200 pips since yesterday claiming the 1.13 level despite no resolution to the Greek situation, although the EU commission has received a new Greek reform proposal. The next target is 1.1376 which was the high on 06/04. The Euro continues its outperformance relative to cable with the EUR/GBP now up over 100 pips since yesterday at 0.7385 pushing towards the 0.74 level and trading at 1 month highs.
-Commodity currencies are under pressure with notable weakness in the NZD/USD coming off some 40 pips after weaker Manufacturing activity data as well as weaker Chinese CPI data, and the AUD/USD is off 60 pips from yesterday's highs off 0.7722.
-USD/JPY is making back some ground making a run for 123 handle, currently at 124.19 helped by yesterday's strong GDP reading. The pair is some 160 pips lower than the high reached after the NFP data.
-Bunds are trading flat after the morning rally couldn't hold. After hitting a high of 150.83 sellers came back into the market pushing it down as low as 150.13. Trading volumes are much lighter this morning in the absence of much fundamental news.
**Political/In the Papers:
(GR) Greece said to submit revised 3-page proposal to creditors - US financial press
(GR) EU Official: Greece revised proposal is not viable, it rehashes prior plans - financial press
**Looking Ahead***
All times listed for economic events are denominated in Eastern Standard Time (Add 4 hours for GMT equivalent)
- 06:45 (US) Daily Libor Fixing
- 07:00 (RU) Russia announces details on upcoming OFZ bond auction for Wed
- 07:00 (BR) Brazil May FGV Inflation IGP-DI M/M: No est v 0.9% prior; Y/Y: No est v 3.9% prior
- 07:30 (DE) German Chancellor Merkel delivers remarks at CDU Economic Conference
- 07:45 (US) Goldman Economist Chain Store Sales
- 08:15 (US) Baltic Dry Bulk Index
- 08:55 (US) Weekly Redbook Sales
- 09:00 (US) May NFIB Small Business Optimism: No est v 96.9 prior
- 09:00 (MX) Mexico May CPI M/M: No est v -0.3% prior; Y/Y: No est v 3.1% prior; CPI Core M/M: No est v 0.2% prior
- 09:00 (EU) Weekly ECB Forex Reserves
- 10:00 (US) Apr Wholesale Inventories M/M: No est v 0.1% prior; Wholesale Trade Sales M/M: No est v -0.2% prior
- 10:00 (MX) Mexico Weekly International Reserves
- 10:00 (US) Apr JOLTS Job Openings: No est v 4.994M prior
- 11:30 (US) Treasury to sell 4-Week Bills
- 12:00 (US) DOE Short-Term Crude Outlook
- 13:00 (US) Treasury to sell 3-Year Notes
- 19:00 (KR) South Korea May Unemployment Rate: No est v 3.7% prior
- 19:50 (JP) Japan Apr Machine Orders M/M: No est v 2.9% prior; Y/Y: No est v 2.6% prior
- 19:50 (JP) Japan May PPI M/M: No est v 0.1% prior; Y/Y: No est v -2.1% prior
- 21:00 (PH) Philippines Apr Exports: No est v $5.4B prior; Y/Y: No est v 2.1% prior
- 23:00 (CN) China to sell 3-Year and 5-year Bonds
- 23:35 (JP) Japan to sell 2-Month Bills
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