Asian stocks recovered from dismal opening Wednesday morning to trade mostly higher, with Hong Kong leading the region amid some buying by funds, though volume remained light ahead of a key European summit.
US markets traded with a positive bias today, as the S&P 500 and NASDAQ were both up approximately 0.75% after yesterday’s sell-off. Bonds sold off, but only moderately while crude traded fairly flat in the US.
The near-month Brent crude future shot up 2.3% on news that striking oil workers in Norway caused the closure of four oil platforms on top of the shut-down of a large processing and drilling facility that has been idle since Sunday.
US stocks advanced despite that fact that US consumer confidence fell to a reading of 62 in June from a reading of 64.4 in May. That’s the lowest reading since January of this year, when the index stood at 61.1. The decline was driven: a) by increases in respondents who found employment ‘hard to get,’ b) who found general conditions were ‘worse’, and c) a reduction in intentions to make major purchases.
EURUSD (1.250) the pair continues to bouncing between small gains and losses ahead of the EU Summit, the outlook for the euro is negative. The EU Finance Ministers continue to play the press and news to get their own agenda’s notices giving statements and leaking documents.
The Great British Pound
GBPUSD (1.5635) Sterling added in yesterday’s session but is not as strong early today. Rumors that Governor King would push through additional monetary stimulus have been supported by recent addresses by King himself. The BoE will meet in the beginning of July.
Asian –Pacific Currency
USDJPY (79.45) Yesterday was a day of pressure on the yen and today is about relief, as Prime Minister Noda was able to get enough votes in the lower house to pass his increase in consumption tax, which was of vital importance to the economic recovery of Japan and supported as a credit positive move by Moody’s.
Gold (1572.55) is looking for direction once again, ahead of the EU Summit and the end of the month data releases gold continues to bounce between small gains and losses, although it is expected to return to the prior downward trend to 1520 once the EU settles down.
Crude Oil (79.77) continues to trade on the negative side, as production estimates soar and demand falls, there is at this time a worldwide oversupply of crude. The black gold is expected to remain in this territory for the next 30-60 days barring any political turmoil.