Stock Market Update

The stock market is on track for a higher start with S&P 500 futures trading 18 points above fair value.

Equity indices in the Asia-Pacific region ended the week on a mixed note. There was some focus on the recent speculation that President Trump's July 9th deadline for reaching trade agreements is not a hard deadline for countries negotiating in good faith. Tokyo Electron CEO said that his company's technology edge over Chinese counterparts will increase. Chinese authorities are reportedly delaying approvals for sales of critical rare earth elements to Western companies.

• In economic data:
  • China's May Industrial Profit -1.1% YTD (last 1.4%)
  • Japan's June Tokyo CPI 3.1% yr/yr (last 3.4%) and Tokyo Core CPI 3.1% yr/yr (expected 3.3%; last 3.6%). May Jobs/Applications Ratio 1.24 (expected 1.26; last 1.26), May Unemployment Rate 2.5%, as expected (last 2.5%), and May Retail Sales 2.2% yr/yr (expected 2.4%; last 3.5%)

---Equity Markets---

• Japan's Nikkei: +1.4% (+4.6% for the week)
• Hong Kong's Hang Seng: -0.2% (+3.2% for the week)
• China's Shanghai Composite: -0.7% (+1.9% for the week)
• India's Sensex: +0.4% (+2.0% for the week)
• South Korea's Kospi: -0.8% (+1.1% for the week)
• Australia's ASX All Ordinaries: -0.3% (+0.2% for the week)

Major European indices trade in the green amid some optimism surrounding indications that the U.S.-China trade deal is being implemented. The Bank of England is facing growing pressure to reduce its bond sales due to a concern that the sales are leading to increased borrowing costs. Germany's minimum wage will increase in two increments from EUR12.82 to EUR14.60 by 2027. European Central Bank policymaker Knot said that the central bank might have to keep rates at their current levels for some time, but he would not rule out another rate cut.

• In economic data:
  • Eurozone's June Business and Consumer Survey 94.0 (expected 95.1; last 94.8)
  • France's June CPI 0.3% m/m (expected 0.1%; last -0.1%); 0.9% yr/yr (expected 0.7%; last 0.7%). May PPI -0.8% m/m (last -4.2%); 0.2% yr/yr (last 0.7%). May Consumer Spending 0.2% m/m (expected 0.1%; last 0.5%)
  • Italy's June Business Confidence 87.3 (expected 87.0; last 86.6) and Consumer Confidence 96.1 (expected 97.0; last 96.5). May PPI -0.7% m/m (last -2.2%); 1.7% yr/yr (last 2.6%). April Industrial Sales 1.5% m/m (last -1.6%); 1.1% yr/yr (last -1.2%)
  • Spain's June CPI 0.6% m/m (expected 0.4%; last 0.1%); 2.2% yr/yr (expected 2.0%; last 2.0%). June Core CPI 2.2% yr/yr (last 2.2%). May Retail Sales 4.8% yr/yr (last 4.1%)

---Equity Markets---

• STOXX Europe 600: +0.8% (+1.0% week-to-date)
• Germany's DAX: +0.9% (+2.0% week-to-date)
• U.K.'s FTSE 100: +0.5% (+0.1% week-to-date)
• France's CAC 40: +1.3% (+0.9% week-to-date)
• Italy's FTSE MIB: +0.3% (+0.6% week-to-date)
• Spain's IBEX 35: +0.7% (+0.5% week-to-date)