Daily Market Report – 12.07.2018

2018-07-12 18:20    AvaTrade
Daily Market Report – 12.07.2018 Institution Opinions

Commodities

We start with the US energy information administration, which last night reported the largest drop in production in 3 years – 12 ½ million barrels. The news came just after news that Libya was ready to resume production after both Canada and Iranian output expectations were revised down. The result – a $4 plunge in prices from 74. The post EIA recovery hasn’t done much for prices, though.

US

Equity markets throughout Europe and the US were down yesterday as the Trump administration prepares to levy that extra 200 billion in tariffs against China. In other news, producer inflation yesterday climbed 3.4% year-on-year, but wholesale inventories came in below expectations at 0.6. And the Bank of Canada surprisingly increased interest rates to 1.5% despite NAFTA tensions. 76% of Canadian goods make their way to the US – that’s about a third of the nation’s GDP. Still, wages are growing nicely and the Loonie’s support at 75-80 is definitely higher than last month’s. Now we need to hope that increased interest won’t hurt the local homes market.

Asia

Last night’s foreign investments in Japan grew by 74 bn yen – that’s after investors pulled out of Japanese stocks in June to the tune of 300 bn. Still, the yen IS struggling after Tuesday’s machinery orders which fell 4% month-on-month. And China has said it would once again retaliate to Trump’s tariffs, but the US doesn’t export that much to China, so the question remains – how? Clearly Europe stands to lose more from this that Asia, as equities are showing. ASIAN indexes, on the other hand, ended this morning with excellent gains – 2.9% in Shezhen and 2.2 in Shanghai.

Europe

The UK last night posted an impressive 2% increase in house prices for June, that’s up from May’s 3% contraction. Meanwhile, the pound is looking for support at 1-32-40 as it tries to recover from its 3-month drop against the dollar, and the FTSE lost another percent point 30 as markets closed last night. Other European indexes didn’t fare much better, the dax and CAC 40 down by a percent and a half.

 

Shares

Tomorrow we have quarterly earnings reports from JP Morgan, Citi and Wells Fargo. In Q1 they all showed major gains, and analysts are expecting a repeat for Q2.

 

Events

Today we’ve got industrial production still coming from the EU at 9 GMT, and jobless claims from the US at noon and a half. Canada’s housing prices will be in at the same time, with exports and imports for China coming overnight.

Thursday    
07:00 EUR German Final CPI m/m
07:45 EUR French Final CPI m/m
9:30 GBP BOE Credit Conditions Survey
All Day EUR Eurogroup Meetings
12:30 EUR ECB Monetary Policy Meeting Accounts
13:30 CAD NHPI m/m
13:30 USD CPI m/m
13:30 USD Core CPI m/m
13:30 USD Unemployment Claims
19:00 USD Federal Budget Balance
     

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