Archives of “June 25, 2019” day

rss

US’ Bolton: All Iran has to do is ‘walk through that open door’ to enter negotiations

  
  Analysis

Comments by US national security adviser, John Bolton

The issue here is that so long as sanctions remain in place, Iran is adamant that they will not negotiate with the US. And that’s leading to rising tensions between the two countries as of late, particularly as Iran has shown that it is willing to strike back after shooting down a US drone last week.

USD/JPY may extend drop to 104.00 by year-end – Mizuho

  
Analysis, Forex

The firm says that the yen may extend gains as demand for haven assets rise

USD/JPY D1 25-06

According to the firm’s senior Asian FX strategist, Ken Cheung, they expect USD/JPY to extend its fall towards 104.00 amid dollar strength peaking out while haven demand will help to boost the yen’s allure by the end of this year.

“We expect USD peaking out as rate cut cycle and heightening uncertainties over global recession risk and US-China trade war push safe havens like JPY higher. While the unwinding of long USD positioning before the Fed’s rate cut cycle continued to weigh on the dollar, heightening safe haven demand on JPY given G20 uncertainties and increasing geopolitical tensions in Iran sent USD/JPY below the 107.00 handle.”

A move towards 104.00 will see USD/JPY fall below the January flash crash low of 104.87 and would definitely bode ill for the BOJ in trying to maintain their goal towards hitting the ever-elusive 2% inflation target.

Reports Trump has considered ending post-war Japan defense pact

  
Analysis, Forex

Bloomberg report, citing unnamed ‘people familiar’

  • Trump has privately considered ending pact with Japan
  • Regards accord with Japan as unfair
Yen has been on the rise in the morning in Tokyo today, down towards 107 as I post:
Trump has been niggling away at Japan on trade and currency matters. So far the differences have been papered over. This is a new front.
Trump will meet with Japan’s PM Abe Shinzo at the G20. This could be part of the softening up process for asking for more from Japan.

Trump to meet Putin, Xi, Modi, Merkel, and others at G20

  
Analysis, Politics

A US official outlines who Trump will be having bilateral meetings with at the G20 later this week in Japan

  • Putin – to discuss Iran, Ukraine, Middle East, Syria, arms control
  • Indian PM Modi
  • Saudi crown prince – to discuss escalation in tensions in Iran and threats to regional stability
  • Turkey’s Erdogan
  • Germany’s Merkel

And, of course (drumroll please), Chinese President Xi!

  • opportunity to “maintain his engagement”
  • see where China is on the trade dispute
  • “The president is quite comfortable with any outcome”
  • meeting with Xi likely to be on second day of G20 (details still to be confirmed)

Trump to also travel to Korea:

  • no plans to meet with Kim Jong Un

A US official outlines who Trump will be having bilateral meetings with at the G20 later this week in Japan

Stick July 10 in your diary – Fed’s Powell testimony

  
  Analysis

On July 10 Federal Reserve Chair Powell will give his semi-annual testimony to Congress

  • Appears before the House (Powell will follow up the next day, July 11, with testimony to the Senate)
This testimony, where Powell delivers prepared text and then is asked question by the elected representatives ,often gives us more insight into the Chair’s (and the FOMC’s) thinking, depending on the quality of the questions of course.
On July 10 Federal Reserve Chair Powell will give his semi-annual testimony to Congress

Trump-Xi diner will be a watershed for markets

  
  Analysis

What are the outcomes from the meeting

Evercore ISI believes there are three outcomes for this week’s meeting between Trump and Xi.
The main one is that that Trump announces he will hold off on China tariffs indefinitely and restart trade talks. They see that as a 45% probability.
This would generally be good for markets but the uncertainty about how long talks could go would undermine enthusiasm and lead to more volatility.
A better scenario would be something similar but with a firm timeline, like 90 days. They see this as a 35% probability. This would give markets a chance to “breathe” they say and benefit trade-sensitive sectors.
The final outcome would be no specific mentions of delays on tariffs. They see this as a 20% likelihood and it would stoke fears. It would result in a statement saying something like the two sides would ‘maintain communications’ but would imply more tariffs to come.

What are the outcomes from the meeting

US stocks end mixed with the Dow up, broader indices lower.

  
Analysis, US Market

Major indices closed near lows for the day

The US major indices or ending the session with mixed results:
  • S&P index -5.04 points or -0.17% at 2945.41. The high reached 2954.92. The low extended to 2944.05
  • NASDAQ index -26.01 points or -0.32% at 8005.69. The high reached 8047.55. The well extended to 8004.62
  • The Dow ended higher by 8.68 points or 0.03% at 26727.81. The high reached 26806.52. The low extended 226723.37

Some gainers today included:

  • Broadcom, +1.9%
  • twitter, +1.64%
  • Deere & company, +1.60%
  • Merck and Company, +1.11%
  • United Technologies,+1.08%
  • Procter & Gamble, +1.02%
  • Stryker, +0.90%
  • Verizon, +0.87%
  • Goldman Sachs, +0.84%
  • Tesla, 0.80%
  • Coca-Cola, +0.74%
  • Facebook, +0.73%
  • J&J, +0.67%
Some losers on the day included:
  • Beyond Meat, -8.53%
  • Bristol-Myers Squibb, -7.4%
  • Celgene, -5.5%
  • Slack, -3.91%
  • Charles Schwab, -3.64%
  • under Armour, -2.52%
  • Chewy, -2.32%
  • Home Depot, -1.93%
  • Phillip Morris, -1.73%
  • Alcoa, -1.73%
  • Box, -1.71%
  • Nike, -1.46%
  • Wells Fargo, -1.36%
  • Morgan Stanley, -1.17%
  • Walgreens, -0.95%
  • Exxon Mobil, -0.95%
Go to top