The Morning Hark - 25 June 2024
The Morning Hark - 25 June 2024
Today’s focus...Dull, dull, dull.
Dear Harkster Subscriber
As you will have seen, through some of our recent publications, we are building out our new product, HarksterAI. We believe that this is an exciting new chapter for the Harkster and we will be sharing more details with you in the coming months.
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Overnight Highlights
Prices are at 6.25 BST/1.25 EST, with changes reflecting movement from midnight GMT
Oil - Oil unchanged in Asia with Brent and Crude August futures currently at 85.20 and 81.70. Yesterday saw another rally for oil with demand hopes still bubbling away and geo-political tensions in Russia and the Middle East continuing to threaten supply.
EQ - Asian equity markets saw a bid tone overnight with the Hang Seng and Nikkei futures up smalls at 18,025 and 39,090 respectively.
The US indicies unchanged with the S&P and Nasdaq futures now at 5525 and 19,800 respectively.
Gold - Gold off smalls in Asia with the August futures trading currently at 2340.
FI - US yields unchanged in Asia with the US2y futures trading at 4.73% whilst the US10y futures yield at 4.23% after yesterday’s weaker session.
European yields started the week little changed with the German 10y closing at 2.42% and the Italian 10y yield at 3.93%.
UK gilt 10y at 4.09%.
FX - The USD flat in Asia with the USD Index currently at 105.40 after yesterday’s sell off. The majors now trading at; JPY, EUR and GBP 159.35, 1.0745 and 1.27 respectively.
Today’s major FX option expiries we have in the EURUSD; $€1.5bn at 1.0700 and USDJPY sees $1.5bn at 160.
Others - Bitcoin and Ethereum bounced back from their sojourn under $60k but still on the back foot with the pair currently at 61,320 and 3390 respectively. Market spooked by the price action and the news that Mt Gox repayments to the hacked victims of the exchange which may reach $9bn and will start next month.
Macro Themes At Play
Recap
German Ifo Survey saw misses across the board versus expectations. Current conditions remained steady at 88.3. However expectations dipped to 89 after 4 consecutive months of growth. Business climate also fell back to 88.6.
Central Bank Speakers
BoC’s Macklem claimed it was reasonable to expect further cuts. Looking for further moderation in wage gains.
Fed’s Goolsbee was keen to stress that Fed policy was restrictive but slowing inflation would lead to easier policy. Outside of inflation, the economy is cooling.
Daly said that it was very clear that monetary policy is restrictive. No evidence of stagflation. Must be thoughtful about not loosening too early or holding too long. If inflation falls rapidly or the labour market softens more than expected then lowering policy rate would be necessary.
The Day Ahead
Canadian Inflation Report for May the only thing on the slate for the day with the Australian equivalent hitting the tapes also overnight.
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Main Highlights Ahead
All times in BST (EST+5 / CET-1 / JST-9)
The main highlights for the day ahead ahead in terms of data and speakers:
Tuesday
Canada Inflation Rate MoM May consensus 0.3% vs previous 0.5% (13.30 BST)
Canada Inflation Rate YoY May consensus 2.6% vs previous 2.7% (13.30 BST)
Canada Core Inflation Rate MoM May consensus 0.2% vs previous 0.2% (13.30 BST)
Canada Core Inflation Rate YoY May consensus % vs previous 1.6% (13.30 BST)
Canada CPI Median YoY May consensus 2.6% vs previous 2.6% (13.30 BST)
Canada CPI Trimmed-Mean YoY May consensus 2.8% vs previous 2.9% (13.30 BST)
Fed Speakers
Bowman (12.00 BST)
Cook (17.00 BST)
Bowman (19.15 BST)
ECB Speakers
Stournaras (10.00 BST)
Early Wednesday
Australia Monthly CPI Indicator May consensus 3.8% vs previous 3.6% (02.30 BST)
Good luck.
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