US stocks slipped on Friday as the failure to reach an agreement on Greek bailout extension at Eurogroup euro-zone finance ministers’ meeting weighed on market sentiment. S&P 500 lost 0.5% and ended at 2109.9. All 10 main sectors closed lower, with utilities and financials leading losses. Nevertheless market indexes recorded gains for the week: S&P 500 advanced 0.8% over the week, and the Dow Jones Industrial Average posted a 0.6% gain. US Treasury yields rose on concerns over possible fallout from Greek default. The dollar traded lower, with the ICE US dollar index, a measure of the dollar’s strength against a basket of six currencies, falling 0.9% this week to 94.1260. Today at 13:30 CET May Chicago Fed National Activity Index will be released. At 15:00 CET May Existing Home Sales will come out. The tentative outlook is positive for the dollar.
European stocks edged higher on Friday as investor confidence was bolstered by overnight gains on Wall Street after the dovish statement of the Federal Reserve. The gains were limited though by investor worries that the failure to reach an agreement on Greek debt impasse may result in default and possible exit of Greece from euro-zone. The Stoxx Europe 600 index finished 0.4% higher. Euro traded lower on concerns capital controls may be imposed in Greece as Greeks continued withdrawing deposits from banks, leading to more than 3 billion euro weekly loss from Greece’s banking system. The European Central Bank governing council raised its emergency liquidity assistance for Greece for the second time in the week in an emergency call on Friday, but didn’t disclose by how much. On Sunday Greek Prime Minister Alexis Tsipras presented the leaders of Germany, France and the European Commission a new proposal after discussing at cabinet meetings concessions Greece could offer to unlock the bailout funds. Today in the evening euro-zone prime ministers and presidents will hold an emergency meeting at 7 p.m.. At 15:00 CET advance estimate of euro-zone consumer confidence index for June will be released. The tentative outlook is negative.
Nikkei rose 1.3% today to two-week high on hopes of a breakthrough at the Greek bailout talks. Today Japan's government will release a fiscal blueprint that will recommend limiting rises in spending to 1.6 trillion yen ($13 billion) for the three years to March 2019, setting a goal of keeping GDP growth above 2% in real terms and 3% in nominal terms. Tomorrow at 2:35 CET preliminary estimate of June Manufacturing PMI will be released in Japan.
The Shanghai Composite Index closed down more than 6% on Friday and fell into correction as it plummeted 13.3% last week, recording its worst week in more than seven years. It is closed today for a public holiday.
Oil prices are edging up today after falling on Friday as investors assessed Saudi oil minister’s comments who confirmed that his country will increase output if demand improves. Baker Hughes data indicated on Friday the number of US rigs actively drilling for oil fell for the 28th straight week, but oil drillers added one rig each in the Permian and Bakken shale basins as prices rose after six-month fall.
Gold settled above $1,200 an ounce, recording 1.9% gain for the week as uncertainty surrounding Greece’s debt negotiations supported investment demand for the metal.