Steady Markets On July 4th, But Prepare For Fireworks Into Weekend

As expected, we saw relatively muted market moves yesterday as the US Independence Day holiday took full affect and participants used it as a good excuse to take a breath and reevaluate ahead of a busy couple of days. We did hear some interesting comments from the ECB that the market is not pricing in rate hikes soon enough for their liking and even though we did see a reaction from the single currency is was very muted and was probably an indication that the market needs to see more solid data before it jumps on that particular band wagon.

Things should start to get a lot more interesting in the markets today as we move through the trading sessions and approach the return of the US market and tomorrow’s big tariff confirmation and employment data. Investors will once again be wary of any fresh news on the trade situation and any of the other geopolitical issues that are currently influencing market moves.

It’s a quiet day in terms of fundamental economic data releases in Asia today, but the news wires should start to heat up as we move into the London session. We’re due to hear from BOE Governor Carney and Buba President Weidmann today and investors will be monitoring both closely for any change in stance from them, especially in light of recent global developments.

Into the New York session and we have a raft of tier 1 US data coming out with the ADP Non-Farm number, ISM Non-Manufacturing data and Crude Oil Inventories all due. Towards the end of the session we also have the latest FOMC Meeting Minutes released, add to this the likely risk of further comments and tweets on the trade situation between the US and China and the potential for volatility today is huge.

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