Stocks Mixed, Bond Yields Lower, Oil’s Up, and the Dollar’s Little Changed

July 22, 2019

Equity markets closed down 1.3% in China and Hong Kong, 0.8% in India, 0.4% in Indonesia, and 0.2% in Japan but have risen in Europe by 0.5% in Germany, 0.4% in Italy and 0.3% in the U.K. and France. U.S. share prices also opened slightly higher.

Ten-year U.S., German and British  sovereign debt yields slipped 3, 2, and 2 basis points, respectively.

The dollar edged up 0.2% against the loonie, Swiss franc and sterling and by 0.1% versus the yen. The greenback is unchanged relative to the euro  and gold and down 0.3% against the kiwi and 0.1% vis-a-vis the Australian dollar.

West Texas Intermediate crude oil appreciated 1.3% earlier today.

On this mid-summer Monday, only a small number of non-influential economic indicators have been reported:

  • Consumer confidence strengthened to a 7-month high and a 2-month high in the Netherlands and Turkey but slipped to a 2-month low in Denmark.
  • CPI inflation in Hong Kong accelerated half a percentage point to a 34-month high of 3.3% in June.
  • Icelandic CPI inflation dipped 0.2 percentage points to a 4-month low of 3.1% this month.
  • Finnish PPI inflation of 0.9% in May spiked downward from 2.0% in April and represented a 30-month low.
  • Irish producer prices in June slid 0.3% on month and were 6.8% lower than a year earlier, the biggest on-year drop since March.
  • Swiss M3 money growth accelerated a bit to 3.7% year-on-year in June.
  • A -0.02 reading on the Chicago Fed national activity index in June was little changed from May’s reading and implies that the U.S. economy is growth in line with its historical trend.
  • On-year growth in Canadian wholesale turnover slowed sharply to just 1.2% in May as such dropped 1.8% compared to the prior month.
  • The unemployment rate in Finland of 8.8% in May was highest this year but half a percentage point below its year-earlier level.
  • The Greek current account deficit in January-May of EUR 4.817 billion was 2.6% greater than a year earlier.

The three main events later this week will the European Central Bank’s policy decision on Monday and subsequent Draghi press conference, the initial estimate of U.S. GDP growth in the second quarter on Friday, and former special prosecutor Mueller’s testimony before congress also on Friday. ECB policy is not expected to change; ECB President Draghi’s 8-year term ends soon. U.S. growth will likely be slower than the 1Q pace of 3.1%.  At Mueller’s only one public statement about his investigation back in April, he said if called to testify that he would reveal nothing beyond the content of the investigation’s written submitted report.

Copyright 2019, Larry Greenberg. All rights reserved. No secondary distribution without express permission.


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