With Mainland China on holidays and not many calendar positions markets in Asia focused on incoming global "risk" events like the Brexit vote and the Fed meeting which led to a deterioration of moods and helped the greenback regain some momentum.
Even though the Mainland bourses were closed Hong Kong equities provided a clear sign declining 1,5%, paving the way for declines in Australia (-1%) and Japan (-0,7%). With no fresh positive news markets were under influence of some bearish statements from legendary investors, with the latest coming from George Soros. Markets also have been very dovish heading into the FOMC meeting next week and with economists still eyeing a hike in July, the greenback was able to come back more than a little bit with the EURUSD down to less than 1.13 from above 1.14 yesterday in the morning.
Oil slid from 11 month highs and created a neat bearish engulfment on a D1 chart yesterday, compounding losses today, although the WTI remains above the 50$/b mark. The data on the rig count in the US may have a lot of impact today (6pm). Let us recall that the count increased substantially for the first time this year last week and another increase would mean that the current price is already attractive for shale frackers to start some drilling. That would be a bearish signal of course.
On the data front we had credit card spending in New Zealand which provided quite a significant disappointment showing a decline of 0,3% m/m in May rather than an anticipated 0,5% increase. That’s down from an increase of 0,8% in April which has also been revised downward. Interestingly there was no significant reaction on the NZD that remains strong following a decision from the RBNZ not to cut rates.
Today there are three important positions in the calendar to watch: labour market data in Canada (1.30 pm), UoM index in the US (3pm) with inflation expectations numbers and mentioned oil rig count (6pm). Also notice the WASDE report on grains (5pm) in the US that might be turning point for soybean or corn.)
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