European stocks have edged lower today as the day of Greek debt payment may be postponed. The euro retreated meanwhile the ICE US dollar index rose. The Greek ATG has tumbled 3% this morning. The pan-European FTSEurofirst 300 index has fallen 4.6% since the beginning of the week. Positive data on German Factory Orders has been released this morning. Other significant macroeconomic reports are not expected today.
Nikkei has sagged 0.5% over the week swinging within a range. In our opinion, the Japanese index was affected by the activity of world equity markets. There were no major events in Japan. Nikkei has grown in the past three weeks and hit 15-year high as strong Q1 GDP and other macroeconomic indicators showing improving economic situation.World crude oil prices are down for the third straight day. Market participants expect that OPEC will decide to keep the current elevated production level at 30 million barrels a day at the meeting today. Previously, independent oil-producing countries, including Russia, stated that they won’t reduce production levels. Recall that lifting of economic sanctions against Iran is expected on June 30. After that the country is going to increase immediately the oil output by 400 thousand barrels a day. Note that last week the number of US oil rigs fell to the lowest level since August 2010 and amounted to 646. At the same time, US oil production rose from 9.3 million to 9.6 million barrels a day. Market players don’t rule out the fact that the reduced number of oil rigs will still lead to a drop in production. They expect the Baker Hughes rig count report which will be released today at 19-00 СЕТ.
As anticipated in previous overview, worsened weather conditions led to rise in price of agricultural futures. Wheat quotes advanced more than 9%, and may be the largest upsurge since 2012. Corn prices upped 3.4% over the week, the highest level since February. Soybean prices didn’t soar that much.
Gold prices have been sagging for three weeks in a row and prices hit 5-week low. Meanwhile, investors ignore the increased default risk in Greece and military operations in Ukraine to reappear, which might lead to tense relations between Russia and the United States.