Focus turns back to risk sentiment and virus developments after the month-end and quarter-end dressing
US stocks finished with a flourish in trading yesterday, wrapping up the June month and second quarter of the year - posting its best three-month run since 1998 in the process.
Meanwhile, the fixing moves and rebalancing flows saw the US dollar weaken across the board and we are seeing some give back now in the likes of cable but other major currencies aren't really moving all too much to start the new day.
The yen is also a tad firmer with USD/JPY backing away after a move above the 108.00 handle as investors will now start to keep the focus back on the coronavirus situation in the US, which haven't been too encouraging to say the least.
There's plenty of talk about vaccine developments and progress too but realistically we're still quite some time away before seeing that turn into anything concrete.
Then again, being 'realistic' isn't quite something that you'd associate with this market.
Looking ahead, there isn't much in terms of data releases to really shake things up but we will also slowly count down to the US jobs report due tomorrow (yes, a Thursday).
0600 GMT - Germany May retail sales data
Prior release can be found here. Expectation is for retail sales activity to rebound in May following the plunge in June, but overall conditions are still to remain soft relative to a year ago - much like most hard data we have seen thus far in Q2.
0600 GMT - UK June Nationwide house prices
Prior release can be found here. Amid the fallout from the virus outbreak and softer economic conditions, housing market activity is expected to dip further. A minor data point.
0715 GMT - Spain June manufacturing PMI
0730 GMT - Switzerland June manufacturing PMI
0745 GMT - Italy June manufacturing PMI
0750 GMT - France June final manufacturing PMI
0755 GMT - Germany June final manufacturing PMI
0800 GMT - Eurozone June final manufacturing PMI
The focus will be on the final readings for France, Germany, and the Eurozone - which have all shown a modest improvement relative to May readings. That just reaffirms better sentiment in general but we'll see how that ties back to hard data at the end of the day. But for now, as these are final readings, don't expect much reaction in the market.
0755 GMT - Germany June unemployment change, rate
Prior release can be found here. The jobless change is expected to remain elevated but not as high as it was seen back in April and May, with the fallout from the virus outbreak still reverberating throughout the economy in general.
0830 GMT - UK June final manufacturing PMI
The preliminary release can be found here. As this is the final reading, don't expect much of a reaction - if any - in the market.
1100 GMT - US MBA mortgage applications w.e. 26 June
Weekly US housing data, measures the change in number of applications for mortgages backed by the MBA during the week. Purchase activity dipped a little last week but is still seen holding at strong levels. However, amid the fresh wave of infections across the country and a continued fallout in economic activity, we may see housing market conditions start to moderate after showing some resilience over the past few weeks.
1130 GMT - US June Challenger job cuts, layoffs
Prior release can be found here. The data provides information on the number of announced corporate layoffs by industry, region and acts as a general labour market indicator.
That's all for the session ahead. I wish you all the best of days to come and good luck with your trading! Stay safe out there.
