European indices are ending mostly higher

France’s CAC down modestly

The major European indices are ending the week mostly higher on the day. The provisional closes are showing:

  • German DAX, +0.1%
  • France’s CAC, -0.1%
  • UK’s FTSE 100, +0.4%
  • Spain’s Ibex, +0.25%
  • Italy’s FTSE MIB, +0.35%
For the week, the major indices are also higher:
  • German DAX, +1.0%
  • France’s CAC, +0.85%
  • UK’s FTSE 100, +1.7%
  • Spain’s Ibex, +0.75%
  • Italy’s FTSE MIB, +1.16%
in other markets as London/European traders look to exit for the weekend:
  • Spot gold is trading up $6.09 or 0.34% at $1781.20
  • Spot silver is up $0.12 or 0.47% at $26.07.
  • WTI crude oil futures are up $0.72 or 0.98% at $74.02
  • The price of bitcoin is down $-2050 or -5.8% at $32,810. The low price today reached $32,350. The high price extended up to $35,500
Looking at the forex, the CAD has taken over the NZD as the strongest of the majors.  The GBP is the weakest.   The USD is lower but off low levels for the day.

UK covid cases continue to accelerate, hit 15,810 in latest report

Deaths still under control

Deaths still under control
UK covid cases hit a four-month high of 16,705 yesterday and remained elevated at 15,810 today. They have steadily increased from 3200 on June as the delta variant circulates.
This is still a long ways off from the +60K numbers in January but headed in the wrong direction.
Hospitalizations are also rising with 1485 people in hospital. Deaths yesterday were 18 which is far from the approximately 1300 peak in January. I suspect that’s what officials are focused on as younger people get the virus. Some require hospitalization but most can fight it off.
I still don’t think this derails the reopening but nearly 44m of the 56m adults in the UK have gotten at least one dose of the (mostly) Astra-Zeneca vaccine. Percentages are lower in London though and that’s worrisome. What mostly bothers me though is the potential for the delta variant to cause problems globally especially in places where MRNA vaccines aren’t available and in schools.
In Israel, the town of Binyamina, became the country’s first “red” location for several months, after the appearance of 122 active cases, reflecting a surge in lockdowns that has been identified around schools. A local report said that in two schools, there were nine fully-vaccinated teachers who contracted the virus.

Risk is positive across markets

Constructive to start the session

The USD is weaker across the board, but marginal ranges

Constructive to start the session 
Commodities are higher as Biden’s plan gives a general boost

Equity futuresYields pretty flat, but the Bank of Mexico’s surprise rate hike shows markets that inflation fears are starting to build
ViX Equity futures are moving higher
S&P500In the FX space NZD, CAD, and AUD are higher and the safe havens CHF, JPY, and sometimes USD lower.

Dollar Index sits at the crossroads ahead of PCE data


The US dollar is sat at the cross roads sat above the 91.40 key support level, waiting for the US PCE data out later.
Keep your eye on this simple trend line for the USD near term direction. Following the Fed’s latest Hawkish shift you would expect the USD to keep tracking higher. Any strong upside surprise from the US PCE data later will be supportive for the USD with the 91.50 near term support. Inflation fears high on the Fed’s agenda as slight wobbles have entered over the inflation is ‘transitory’ narrative.
Big picture stuff, but the key trend line for the daily chart

Oil – OPEC+ meeting next week, demand is strong but there is fragility

Via ANZ, a good overview of oil heading into the OPEC+ meeting July 1:

  • group … reviews its production agreement
  • Increased travel and strong economic growth is likely to see the recovery in demand accelerate. This will tighten the oil market. 
  • However, the situation is fragile amid sudden outbreaks of COVID and the possibility of rising supply from a variety of sources. 
  • The market is calling out for more crude oil, while others are concerned about the inflationary impact of higher prices. 

Fitch Ratings: Bitcoin hampered by its significant price volatility

Fitch Ratings with the opinion on BTC

  • says bitcoin could increase regulatory, AML risks for El Salvador banks
  • says the high level of bitcoin price volatility will challenge its use as a store of value and means of payment
  • believes foreign parent banks would offer operational, technical support to el Salvador banks to manage bitcoin implementation associated risks
I imagine the BTC folks are huge fans of ratings agencies …. or maybe not 😀
Fitch Ratings with the opinion on BTC

S&P and NASDAQ index post record closes

Dow rises over 300 points and leads the way with a gain close to 1%

The major indices saw solid gains across the board with the Dow industrial average leading the way after Pres. Biden and a group of 20 centrist senators agreed on a $1 trillion infrastructure plan.

The NASDAQ and S&P index both closes higher and at record levels. The NASDAQ record was the third day in a row.  The Russell 2000 index gained 30.16 points or 1.31% at 2333.62.
The final numbers are showing:
  • S&P index up 24.64 points or 0.58% at 4266.48
  • NASDAQ index up 97.98 points or 0.69% at 14369.71
  • Dow industrial average up 322.65 points or 0.95% at 34196.89.
After the close the Fed will announce the stress test results for the US banks. Today financials all rose smartly with Wells Fargo up 2.78%. Citigroup up 2.4%, PNC financial 2.18%. J.P. Morgan rose 0.91% but like other major financials.
Dow rises over 300 points and leads the way with a gain close to 1%_
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