May 23 • Morning Roll Call • 1545 Views • Comments Off on MORNING ROLL CALL

U.S. equities rise due to Trump’s Saudi Arabia trip, dollar falls, crude rises on hope of OPEC cut extension, gold rises

During Monday’s trading sessions economic calendar events (concerning the USA), were thin on the ground. The USA public experienced some (temporary) relief from the relentless anti Trump narrative, as the focus was off Trump’s domestic policy and the controversy regarding his shared intel with Russia. USA markets rallied, whilst the mainstream media applauded the circa $360b trade deals Trump negotiated with the KSA. Naturally industrial and armament corporates were the main beneficiaries in the equities rally due to potential Saudi orders; Boeing and 3M were prime examples. The DJIA closed up 0.43%, the SPX closed up 0.52% on the day, whilst the NASDAQ closed up 0.82%. The dollar index; tracking the greenback versus a basket of its six major rivals, was down 0.14% to 97.000. It fell to a low of 96.797 (the lowest level seen since Nov. 9th), earlier in the day’s sessions.

In Europe economic calendar news was also thin on the ground, the euro railed versus the majority of its peers on Monday, EUR/USD ending the day up circa 0.4% at 1.1237, EUR/GBP closed the day up circa 0.5%, at 0.8642. Germany’s leader Angela Merkel was partly responsible for the rise; suggesting that the euro was too weak and therefore causing a huge trade surplus in Germany. Analysts took this as the possibility that she may put pressure on the ECB, to finally raise the interest rate from its current floor.

Equity markets in Europe were mixed; STOXX 50 closing down 0.29%, CAC down 0.03%, DAX down 0.15%. The UK’s FTSE broke the trend and closed up 0.34% in near perfect negative correlation with sterling, which fell versus its main currency peers; GBP/USD closing the day out down 0.4%, at 1.2997. Sterling sold off versus the majority of its peers as a consequence of Theresa May’s disastrous election manifesto launch, causing a collapse in polling support.

WTI oil rose by 0.7%, to stay above the critical $50 a barrel handle at 50.73, noises emanating from OPEC; that there’ll be an extension to the production cuts agreed in December, helped boost price. Gold rose by circa 0.5% on the day, to close out at approx. $1260 per ounce. Silver ended the day up a similar amount, to end the day at close on $17.14 per ounce, still some distance from the 200 SMA, at circa 17.60.

Economic calendar events scheduled for May 23rd, all times quoted are London GMT time.

06:00, currency impacted EUR. German Gross Domestic Product n.s.a. (YoY) (1Q F). The prediction is for no change on the previous reading of 2.9%

06:00, currency impacted EUR. German Exports (1Q). Exports are predicted to fall to 1.5%, from the 1.8% reading registered in the last Q of 2016.

06:00, currency impacted EUR. German Imports (1Q). Imports are forecast to have fallen to 1.0%, from the 3.1% growth recorded in Q4 2016.

07:30, currency impacted EUR. Markit Germany Services PMI (MAY P). The reading is predicted to have risen to 55.5, from 55.4 in April.

07:30, currency impacted EUR. Markit/BME Germany Manufacturing PMI (MAY P). The reading is forecast to fall to 58, from the 58.2 recorded in April.

08:00, currency impacted EUR. Markit Eurozone Manufacturing PMI (MAY P). The expectation is for a small fall to 56.5, from 56.7 in April.

08:00, currency impacted EUR. Markit Eurozone Services PMI (MAY P). The prediction is no change, from the previous reading of 56.4.

08:00, currency impacted EUR. Markit Eurozone Composite PMI (MAY P). A slight fall to 56.7, from 56.8 is predicted.

08:00, currency impacted EUR. German IFO – Business Climate (MAY). The forecast is for an improvement to 113.1, from 112.9 previously.

08:30, currency impacted GBP. Public Sector Net Borrowing (Pounds) (APR). The expectation is for a rise to 8.0b, from the 4.4b previously recorded.

13:45, currency impacted USD. Markit US Manufacturing PMI (MAY P). The forecast is for a rise to 53.1, from the 52.8 registered previously.

13:45, currency impacted USD. Markit US Services PMI (MAY P). The forecast is for a modest rise to 53.2, from the 53.1 recorded in April.

13:45, currency impacted USD. Markit US Composite PMI (MAY P). the expectation is for no change, from the current reading of 53.2.

14:00, currency impacted USD. New Home Sales (MoM) (APR). House sales rose significantly in March, the expectation is for a fall back into negative territory of -1.8%, from the 5.8% reading recorded in March.


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