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Rise and shine everyone.
We had quite the surge in markets yesterday on CPI numbers coming out better than expected at both the Headline and Core Levels. With this news the markets are now expecting only one further hike from the Fed in July.
Today we get the PPI numbers at 8:30am ET, which is also likely to show a slowdown in prices.
We also have a host of earnings today. Pepsi and Delta reported a double beat. Fastenal reported a double miss. (more in Calendars below)
Asia and Australia
Asian equities ended sharply higher Thursday on the back of Wall Street's strong rally. Hong Kong led the way. Japan benchmark bounced from a one-month low. India's Sensex hit fresh record high, Southeast Asia mixed as Thailand underperformed on step down in political impasse over PM role.
China’s Customs exports fell 12.4% y/y in June marking the sharpest decline in almost three years, compared to expectations of a 9.5% drop. We continue to see lower growth data coming out China.
Bank of Korea kept its 7D repo rate unchanged at 3.5% as largely expected amid sharp decline in inflation during June, recently stable won, and uncertain economic growth outlook.
Taiwan's IT industry is facing its biggest slump on record, with the combined sales of 19 major companies down about 20% on the year in June. Taiwan Semiconductor Manufacturing Co.'s June sales fell 11.1% to 156.4 billion New Taiwan dollars ($5 billion), the fourth consecutive month of decline.
JGBs underperform global counterparts amid lingering speculation of a BOJ YCC tweak
Europe, Middle East, Africa
European equity markets firmer. Follows broad strength in Asia after strong Wall Street close.
UK GDP: The ONS published monthly UK activity data, which showed the economy contracted 0.1% in May, down from April's 0.2% expansion, but it was not as bad as the 0.3% fall expected by economists.
The BoE's Q2 credit conditions survey showed availability of secured credit to households decreased in the three months to end-May 2023 - Mortgage default expectations rise.
Olive prices are surging in Spain with Olive Oil prices reaching a record high because of heat waves and water shortages.
The Americas
The Bank of Canada lifted the benchmark rate by 25bp rate hike, lifting the overnight rate to 5.0%, as expected. They also delayed their inflation target forecast. BoC wrote CPI forecasted to hover around 3% for the next year before gradually declining to 2% in the middle of 2025, a slower than forecasted return to target.
Disney has extended Bob Iger’s contract until the end of 2026, prolonging what was meant to be a short-term stay for the chief executive after he returned to the world’s largest entertainment company last November.
Manhattan rental prices ease slightly in June following three straight months of record highs
Amazon Prime sales up 6% from last year; still short of estimates
IEA cuts 2023 oil demand growth estimate by 220K bpd due to challenging economic environment
Calendars
(news taken from Reuters, FT, Bloomberg; Calendar from Benzinga Pro)
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