Equities slightly lower as global protests continue

Equities slightly lower as global protests continue 981 980 Realm

Equities are a little lower this morning with markets focused on economic recovery and global protests.


Global Macro

  • The Federal Reserve’s policy meeting will be keenly watched next week, with investors looking for any change in the central bank’s stance alongside its updated economic projections. Meanwhile, European finance ministers will hold a call to debate policy measures to support the bloc’s recovery. Key economic data to follow include US consumer sentiment and inflation; UK monthly GDP; Eurozone and Japan final Q1 GDP; China inflation; Australia business and consumer morale; and India inflation and industrial production.
  • Imports to China slumped 16.7% yoy to USD 143.89 billion in May 2020, following a 14.2% fall in the prior month and compared to market expectations of a 9.7% drop, and marking the steepest decline since January 2016, due to deteriorating domestic demand. There were declines in imports of aluminium (-28.6%), the lowest since February 2019, due to a fall in demand of Chinese metal. Also, imports of copper concentrate fell by 8.1% while those of coal dropped nearly 20% even as demand recovered at power plants and industrial users.
  • China’s trade surplus widened sharply to USD 62.93 billion in May 2020 from USD 41.20 billionin the same month the previous year and far above market expectations of a USD 39 billion surplus. It was the largest trade surplus since the series began in January 1981, as exports dropped less imports, amid growing tensions with the US.
  • The US economy unexpectedly added 2.5 million jobs in May, the most on record, beating expectations of an 8 million cut, and after declining by a record high of 20.7 million in April. Large employment increases occurred in leisure and hospitality, construction, education and health services, and retail trade while government employment continued todecline sharply. The change in total nonfarm payroll employment for March was revised down by 492,000 to -1.4 million, and the change for April was revised down by 150,000 to -20.7 million. Figures for May suggested the economic recovery.
  • On Friday: European stocks ended on an upbeat note, as positive reaction to the ECB’s asset-buying program, and surprisingly better-than expected U.S. jobs data triggered hectic buying across the board. US stocks moved sharply higher during trading on Friday following the release of a Labor Department report showing an unexpected jump in employment in the month of May. With the rally on the day, the tech-heavy Nasdaq reached a new record intraday high. Asian stocks finished mostly higher even as caution prevailed ahead of the U.S. employment report.
  • Friday’s data below:

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