Major European indices end the session mostly lower

UK’s FTSE 100 flat

The major indices are ending the session mostly lower. The provisional closes are showing:

  • German DAX -0.9%
  • France’s CAC, -0.8%
  • UK’s FTSE 100, unchanged
  • Spain’s Ibex, -0.8%
  • Italy’s FTSE MIB, -0.7%
In the European debt market, the benchmark 10 year yields are mostly lower with the exception being the UK 10 year up 0.4 basis points. The yields are off their lowest levels of the day however.
UK's FTSE 100 flat_
Looking at other markets as London/European traders look to exit:
  • Spot gold is up $8.50 or 0.48% $1787.30.
  • Spot silver is up $0.38 or 1.49% at $26.16
  • WTI crude oil futures are up $0.73 or 1.0% at $73.58. The high price extended to a new cycle high of $74.25 before rotating back to the downside. Crude oil inventory data showed a bigger than expected drawdown of 7.6 million barrels versus -3.5 million barrels estimate. Last week there was a drawdown of 7.3 million barrels as the economy reopens and people hit the road.
  • The price of bitcoin is up $744 or 2.26% at $33,651. That is off the intraday high of $34,881.
In the US stock market, the markets are mixed:
  • The NASDAQ index made a new all-time high today of 14317.66. The currently trades at 14281.13, up 28 points or 0.20%
  • S&P index reached a high of 4256.60. That was just below the all-time high of 4257.11. It currently trades at 4248.69, up 2.28 points or 0.05%
  • Dow industrial average is down around 20 points or -0.06% at 33925.30.

USDJPY fails on the break above 2021 high

March 31 high comes in at 110.96

The USDJPY moved to a new high for 2021 earlier today after breaking above the March 31 high of 110.96. The high price today reached 111.099.
March 31 high comes in at 110.96
Looking at the hourly chart below, the move above the March 31 high at 110.96 lasted for about an hour or so before failing and moving back to the downside. The corrective high price since the break lower reached 110.909 – about 5 pips below that old high.  The current price is trading around 110.734. That takes the price below the June 17 high of 110.818.


US weekly EIA crude oil inventories -7614K vs -3500K expected

Weekly EIA petroleum inventories for the week ending June 18, 2021:

US weekly EIA crude oil inventories
  • Prior was -7355K
  • Gasoline -2930K vs +1050K exp
  • Distillates +1754K vs +1000K exp
  • Refinery utilization -0.4% vs +0.5% exp
  • Cushing -1833K
API data released late yesterday:
  • Crude -7199K
  • Gasoline +959K
  • Distillates +992K
  • Cushing -2550K
The surprise in this report is the drawdown in gasoline inventories. The headline was foreshadowed by yesterday’s API numbers so it wasn’t a big surprise but gasoline tightening up points to strong driving demand.

German Foreign Minister Mass On Iranian nuclear talks

US/Iran nuclear deal news

  • German Foreign Minister Maas says there are still some issue in Iranian nuclear talks, but some progress has been made
  • Assumes there is a chance to seal the deal in near future, even after the Iran election
Expect any news of a deal to send oil lower, but any dips may be quickly bought as fundamentals look good for oil over the medium term regardless of the Iranian supply

Oil at $100?

Growing voices for higher oil

Some reasons for oil to remain bullish as follows. Eamonn has been well on this all week.
  • India sales have rebounded in 1h of June
  • US/Iran deal not progressing well
  • COVID-19 vaccines are going well – less of a link between infections and hospitalisations/deaths
  • Lack of supply noted
  • Inventories keep falling – another private inventory last night
  • Market shrugs off OPEC+ sources looking to increase supply from August
Reasonable to expect intraday buyers at $71.50 with stops below support

Growing voices for higher oil

Some used vehicles in the US now costing more than new ones


One area that US inflation is being keenly felt is in the used cars sector. Fed’s Powell expects this to be temporary and for supply/chip shortages to be rectified and for that market to calm down.
So how hot is it? Well some used cars are trading for more than their new price!
According to Bloomberg a typical 2019 Toyota Tacoma SR double cab pickup was just under $29,000. Two years later, the same car is going to dealers for $30,000 and then sold on to consumers for $33,0000. According to Black Book, which tracks car and truck data, used cars have climber 30% this year.
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