U.S. equities fall, dollar rises, euro falls as PMIs disappoint, GBP/USD makes biggest gain in three weeks

Jul 25 • Morning Roll Call • 2105 Views • Comments Off on U.S. equities fall, dollar rises, euro falls as PMIs disappoint, GBP/USD makes biggest gain in three weeks

In a major day for Markit PMI releases, the Eurozone figures came in below expectations on Monday. In a sea of red, France and Germany’s: manufacturing, services and composites and the overall Eurozone composites, all missed their forecasts. The misses weren’t huge, for example; Germany’s manufacturing PMI came in at 58.3, which is still signifying substantial growth and all the metrics were above the median 50 line, separating growth from contraction. However, investors translated the consistent fall (across the board), as evidence that Europe’s recent growth period may now be petering out.

Consequently the equity markets in Europe endured a mixed day, with several indices falling; UK’s FTSE down 1.01%, DAX down 0.25%, STOXX 50 was flat (up 0.04%) and France’s CAC closed up 0.20%. The UK’s main index was not reacting well to the lack of confidence investors have in the overall competence levels, displayed by the UK’s Brexit negotiating team. EUR/USD fell by circa 0.2% to 1.1637, whilst GBP/USD made its largest gain in approx three weeks; up circa 0.3% at 1.3032.

USA economic calendar news centred on the three main PMIs; services, manufacturing and composite, with the manufacturing PMI beating the forecast by coming in at 53.2, the two remaining PMIs coming in as forecast, at 54.2. Disappointing USA economic news came in the form of existing home sales; falling -1.8% in June, adding to the doubts regarding the overall health of the U.S. housing market. The DJIA fell by 0.18%, SPX by 0.04%, whilst the NASDAQ rose by approx. 0.30%. USD/JPY fell by circa 0.1%, to 111.10. WTI oil rose by circa 1.4% to $46.36 per barrel, whilst gold added approx. 0.3%, to $1254 per ounce.

Economic calendar events for July 25th, all times quoted are London (GMT) time

08:00, currency impacted EUR. German IFO – Business Climate (Jul). The expectation is for a fall to 114.9, from the June reading of 115.1. This is one of three IFO indices published for Germany’s economy on Tuesday, all three rated as medium impact releases.

13:00, currency impacted USD. House Price Index (MoM) (May). The forecast is for a fall to a 0.5% increase for the month of May, from the 0.7% increase registered in April.

13:00, currency impacted USD. S&P/Case-Shiller Composite-20 (YoY) (May). The prediction is for an average house price rise to 5.75%, for the 20 main USA cities polled, from the 5.67% recorded for April.

14:00, currency impacted USD. Consumer Confidence (Jul). This conference board confidence reading carries a lot of weight in the markets, the prediction is for a reading of 116, a fall from the 118.9 registered in June.

17:00, currency impacted GBP. BOE Chief Economist Haldane Speaks in London. Andy Haldene is the much respected, chief economist of the BoE. His opinion will be monitored carefully, in terms of the current economic conditions in the U.K.

22:45, currency impacted NZD. Trade Balance (New Zealand dollars) (Jun). Analysts are predicting that the trade balance will increase to 150m, from the 103m registered in May.

22:45, currency impacted NZD. Balance (YTD) (New Zealand dollars) (Jun). The forecast is for a marginal improvement to -3680m, from the -3754m figure recorded in May.



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