US Stocks Surge Again to Fresh Records – Nasdaq up 1%
US stocks markets resumed their upwards trajectory in trading yesterday as the S&P notched up its 30th record high of the year. The Dow added 0.49% on the day, with the tech favourites, S&P rising 0.77% and the Nasdaq climbing 0.95%. In contrast, US treasury yields pushed higher as well with the 2-year adding 8.2 basis points to trade up to 4.767% and the benchmark 10-year gaining 6.2 basis points to 4.275%. The dollar lost some ground on the other majors, losing 0.2% on the index as Euro bounced off of recent lows. Oil powered higher as major industry groups predicted demand increases into the second half of the year, Brent gaining 2% to $84.25 a barrel and WTI up 2.4% to $80.33 a barrel whilst Gold dropped 0.7% to trade back to $2,317 per ounce in line with dollar yields.
Reserve Bank of Australia in Focus Today
Australian markets will be braced for a fresh update from the Reserve Bank of Australia today and despite indications that the economy is slowing, they are expected to keep rates on hold at 4.35% and maintain a hawkish bias in their guidance. The RBA is forecasting that inflation will only hit their target level towards the end of next year and a strong jobs data print last week has not helped those looking for quicker easing. The Aussie dollar has been trading in relatively tight ranges for the last couple of months but is now trading near recent lows, so a more dovish tone from Michele Bullock and team could see a fresh break lower, however most traders still feel she will maintain a more hawkish outlook which could see it recover back into familiar territory.
Economic Event Calendar Starts to Warm up Today
The macroeconomic calendar starts to warm up from today as we hear from our first central bank of the week as well as see some tier 1 US data. The Reserve Bank of Australia is set to update the market on its latest rate call and the conclusion of the meeting will be the highlight for the Asian session. The European day has less on the calendar although the ZEW economic sentiment data and EU CPI final numbers will draw some attention. The New York session will see that focus back firmly on US markets with the May Retail Sales data due out, expectation is for a 0.3% rise in the headline number and a 0.2% rise for the core data. The latest Industrial Production numbers are also due out later in the day.
