Markets in Asia closed near unchanged to slightly lower levels as investors wait for G-20 headlines. IT names though were a bit better bid in Japan while defensives slipped. IT joined Health Care to the upside in Hong Kong as well. After headlines that no deal is expected at the G20 coupled with word the US is not willing to make concessions markets fell yesterday. That sentiment carried over but ticked up with hopes that no new tariffs may be agreed upon in a goodwill gesture.
Economic releases were light with focus on the New Zealand’s RBNZ leaving rates unchanged. Members did talk about cutting rates but held off adding a lower cash rate may be needed over time. Heading into lunch in Europe NZD is working higher. Also on the currency front the Nikkei reported results of a study between them and the Center for Eco Research that showed 107 is the equilibrium exchange rate for the ¥ vs the Dollar.
- Oil prices are the upside post yesterday’s API inventory draw and continued Iranian sanctions. Gasoline prices are up over 3% with a Philly refinery to be shut post a recent fire there.
- To note, yesterday MSCI said Kuwait is being upgraded to Emerging Market status and will be included in weightings starting next June.
- An executive with Micron yesterday said inventory levels in DRAM and NAND are still elevated adding capex will need to be pared to return inventories to normal levels. Earnings view were still mixed with the firm noting they are shipping some products to Huawei. Evidently lawyers found that some products were not covered by the ban with Intel also said to be shipping products as well. Markets bid up the stock after hours with gains extending to peers in the sector as well. SK Hynix +3.3%, Transcend +1.6%.
After a weaker start indices have moved to the upside after Treasury Secretary Mnuchin said on CNBC a deal with China is 90% complete. He added he believes there is a path to complete it with markets recovering yesterday’s weakness. On that, Banks and Autos lead with gains of a percent with Tech flat currently. Economic data in Europe is also scant with French Consumer Confidence up to 101, a bit better than the 99 prior reading.
EU talks with Switzerland continue with the Swiss yet to agree to a framework that ties them closer to Brussels. On the equity front, June 30th is set for the cutoff that Switzerland will lose EU equivalence related to markets. Switzerland is responding but preventing exchanges and MTF’s outside of the country from trading their names. Dual listed names though will continue to be traded in markets away from the SIX.
Project manager John Wood is up 7% post reporting it sees strong FY results. RBC noted cost savings and stronger margins with infrastructure and industrial spending up in the US and in Canada.
On supposed interest from Kone, ThyssenKrupp is up 8%. A firm called Platow Brief said their elevator biz is in focus with Kone saying they will not speculate on rumors.
German chemical firm Brenntag is off over 5% on press reports the firm sold chemicals to Syria that could be used in the production of chemical weapons. The chemicals sent were for production of a pain relief drug but could be used in weapons as well.
|NO||18)||Unemployment Rate AKU||Apr||3.50%||3.20%||3.50%||—|
|GE||19)||GfK Consumer Confidence||Jul||10||9.8||10.1||—|
|DE||20)||Retail Sales MoM||May||—||-0.30%||-0.30%||-0.50%|
|DE||21)||Retail Sales YoY||May||—||-0.70%||3.20%||3.10%|
|AS||23)||Bank Austria Manufacturing PMI||Jun||—||47.5||48.3||—|
|IT||24)||Deficit to GDP YTD||1Q||—||4.10%||2.10%||—|
|SZ||25)||Credit Suisse Survey Expectations||Jun||—||-30||-14.3||—|
|UK||26)||UK Finance Loans for Housing||May||41000||42384||42989||42898|
|IC||27)||7-Day Term Deposit Rate||26-Jun||—||3.75%||4.00%||—|