North American News
US equities conclude a truncated trading session with moderate advances
- Closing changes for the main US stock markets
It was an early close today because of the Independence Day holiday tomorrow.
- S&P 500 +0.1%
- Nasdaq +0.2%
- DJIA +0.1%
- Russell 2000 +0.3%
Under the surface there were some big moves with Tesla up 6.4%, travel names doing well and regional banks posting strong gains.
Atlanta Fed GDPNow Q2 tracker +1.9% vs +2.2% prior
- The second quarter is over but we’re still weeks away from the GDP report
It’s easy-come-easy-go for the Atlanta Fed’s GDP tracker as it rose to 2.2% from 1.8% on Friday and now has given most of that back in a dip to 1.9%.
The first look at Q2 GDP is due on July 27 but, as a reminder, the numbers are revised many times. Just last week, the Q1 number was boosted to 2.0% from 1.4%.
The catalyst for the latest downgrade was today’s ISM report:
“After this morning’s construction spending release from the US Census Bureau and the Manufacturing ISM Report On Business from the Institute for Supply Management, the nowcast of second-quarter real gross private domestic investment growth decreased from 10.4 percent to 8.8 percent.”
US construction spending for May 0.9% versus 0.6% expected
- US construction spending for May 2023
- Prior month 0.4% revised from 1.2% previously reported
Total Construction:
- Construction spending was estimated at a seasonally adjusted annual rate of $1,925.6 billion, a 0.9 percent increase from the revised April estimate of $1,909.0 billion.
- The May figure is 2.4 percent higher than the May 2022 estimate of $1,880.9 billion.
- In the first five months of 2023, construction spending totaled $740.8 billion, 2.9 percent higher than the same period in 2022, which saw $719.6 billion.
Private Construction:
- Spending on private construction was at a seasonally adjusted annual rate of $1,513.2 billion, a 1.1 percent increase from the revised April estimate of $1,497.2 billion.
- Residential construction reached a seasonally adjusted annual rate of $857.4 billion in May, a 2.2 percent increase from the revised April estimate of $839.4 billion.
- Nonresidential construction was at a seasonally adjusted annual rate of $655.8 billion in May, a 0.3 percent decrease from the revised April estimate of $657.8 billion.
Public Construction:
- Public construction spending was estimated at a seasonally adjusted annual rate of $412.4 billion in May, a 0.1 percent increase from the revised April estimate of $411.8 billion.
- Educational construction remained virtually unchanged at a seasonally adjusted annual rate of $87.7 billion.
- Highway construction was at a seasonally adjusted annual rate of $124.6 billion, a 0.4 percent decrease from the revised April estimate of $125.1 billion.
ISM manufacturing PMI for June 46.0 versus estimate of 47.0
- ISM manufacturing PMI for June 2023 highlights
- Prior report 46.9
- ISM Manufacturing PMI 46.0 versus 47.0 estimate
- Prices paid tumbles to 41.8 versus 44.0 estimate. Last month 44.2
- Employment falls below 5248.1 from 51.4 last month and 50.5 estimate
- New orders rise to 45.6 from 42.6 last month
S&P global manufacturing PMI final For June 46.3 versus flash estimate of 46.3
- S&P global manufacturing PMI data for June 2023
- Flash estimate 46.3
- Manufacturing PMI final 46.3 unchanged from the flash estimate
- Prior month 48.4
Commodities
Silver rises after weak US Manufacturing PMI
- XAG/USD stands with nearly 0.50% gains near $22.90 after reaching a daily high of $23.70.
- US Manufacturing PMI fell to 46 in June, a contraction worse than expected.
- Falling US Treasury yields gave room for the precious metal to rise.
Silver is rising, showing gains of approximately 0.70% and trading near $22.90, following a surge that led to a daily high of $23.70. This upward momentum comes in response to the weak US Manufacturing Purchasing Managers’ Index (PMI) for June, which recorded a contractionary figure of 46, falling short of expectations. The decline in US Treasury yields has allowed the precious metal to advance, although it is worth noting that yields are still in positive territory, which can limit the XAG/USD’s upside potential.
Gold jumps to one-week highs after US data
- Gold gains momentum after US ISM Manufacturing.
- XAU/USD extends rebounds from monthly lows, tests $1,930/oz.
- US Dollar erases gains, US yields pullback from weekly highs.
Following the release of weaker-than-expected US economic data, Gold price jumped to $1,931, reaching the highest level in a week. The weaker data triggered a decline of the US Dollar and boosted Treasury bonds.
Oil jumps as Saudi Arabia extends voluntary output cuts for another month
- Saudi says to extend the voluntary cut of 1 mil bpd for another month to include August
That is resulting in a decent jump in oil prices on the session, with WTI crude moving up by nearly 2% to around $71.60 currently.At the same time, Russia is also saying that it will reduce oil supply by 500k bpd in August and that will keep a lid on supply conditions even as the oil market is expected to tighten heading into the summer.
EU News
European indices close today with mixed results
- Indices give up gains and close near the session lows for the day
Major European indices are closing mixed.The German DAX, France’s CAC, and UK’s FTSE 100 gave up most of their gains and are trading near session lows.Spain’s Ibex and Italy’s FTSE MIB are closing higher.
The final numbers are showing:
- German DAX, -0.47% at 16072.47. The high price reached 16209.29. The low price was at 16070.49
- Frances CAC- 0.16% at 7388.27. It’s low price reached 7387.52
- UK’s FTSE 100 fell -0.05% at 7527.27. It’s session lows reached 7513.93
- Spain’s Ibex rose 0.56%
- Italy’s FTSE MIB rose 0.79%
Eurozone June final manufacturing PMI 43.4 vs 43.6 prelim
- Latest data released by HCOB – 3 July 2023
- Prior 44.8
Italy June manufacturing PMI 43.8 vs 45.3 expected
- Latest data released by HCOB – 3 July 2023
- Prior 45.9
Spain June manufacturing PMI 48.0 vs 47.7 expected
- Latest data released by HCOB – 3 July 2023
- Prior 48.4
Germany June final manufacturing PMI 40.6 vs 41.0 prelim
- Latest data released by HCOB – 3 July 2023
- Prior 43.2
UK June final manufacturing PMI 46.5 vs 46.2 prelim
- Latest data released by S&P Global – 3 July 2023
- Prior 47.1
SNB total sight deposits w.e. 30 June CHF 491.9 bn vs CHF 508.0 bn prior
- Latest data released by the SNB – 3 July 2023
- Domestic sight deposits CHF 480.2 bn vs CHF 496.6 bn prior
Switzerland June manufacturing PMI 44.9 vs 42.3 expected
- Latest data released by Procure – 3 July 2023
- Prior 43.2
Switzerland June CPI +1.7% vs +1.8% y/y expected
- Latest data released by SECO – 3 July 2023
- Prior +2.2%
- Core CPI +1.8% y/y
- Prior +1.9%
France June final manufacturing PMI 46.0 vs 45.5 prelim
- Latest data released by HCOB – 3 July 2023
- Prior 45.7
ECB’s Nagel: Inflation is not retreating as we would like it to
- ECB’s Nagel is giving a hawkish view
- He is conf
- We still have way to go with policy tightening
- Monetary policy signals are clearly pointing in the direction of further tightening
- Euro systems balance sheet should be significantly reduced in coming years
- ident a hard landing can be avoided
Other News
Morgan Stanley bumps up ECB terminal rate forecast to 4% from 3.75% previously
- The firm sees a more hawkish ECB stretching beyond the summer
That translates to a 25 bps rate hike in July and one more after in September. It will definitely come down to the data but after seeing the June inflation figures, there is reason to believe that price pressures will remain sticky beyond the summer. And that should warrant further ECB action so long as the economy holds up.
UBS ups ECB terminal rate forecast to 4% as well
- The firm sees one more additional 25 bps rate hike in September
Cryptocurrency News
PEPE whales are scooping up the meme coin again, pushing price to $0.00000190
- PEPE’s on-chain activity is on the rise with increase in whale transactions and trade volume.
- Large wallet investors started scooping up PEPE tokens early on July 3.
- PEPE price is $0.00000190, the meme coin has wiped out all losses from the SEC’s crypto crackdown in June.
PEPE’s large wallet investors, who booked millions in profit on the meme coin, started accumulating the token again early on Monday. Two whale wallets identified by a crypto intelligence tracker spent over $1.19 million in acquiring PEPE tokens.
The meme coin’s on-chain metrics paint a bullish picture for PEPE price rally in the short term.
Ethereum eyes $2,000 target as institutional investors pour capital into ETH funds
- Ethereum investment products received an inflow of $2.7 million from institutional investors, according to a recent report.
- Ether recorded the second largest capital inflow after Bitcoin CoinShares data shows.
- The altcoin is inching closer to the $2,000 psychological target amid rising capital inflow and interest from investors.
Ethereum ranks highest among altcoins in terms of institutional capital inflow, according to CoinShares’ latest report.While Bitcoin dominates the capital inflow from investors, Ethereum funds have observed a $2.7 million inflow over the past week.
Ethereum price is in an upward trend on Binance and the altcoin is closer to breaking past the key psychological target of $2,000.
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