To the scoreboard:
- Dow: 24,580.89 +119.19 (+0.49%)
- S&P 500: 2,754.88 +5.12 (+0.19%)
- AUD/USD: 0.7440 +0.0060 (+0.81%)
- ASX200 SPI futures (September contracts): 6,180 (+13)
1. Global stock markets were steady over the weekend, with gains underpinned by energy stocks after oil prices rose in the wake of the OPEC meeting in Vienna. The ASX200 looks set to extend last week’s strong rally, with futures traders marking the local index higher this morning.
2. Brent crude rose by almost 4% to close at $US75.81 as OPEC presented a unified voice about the prospect of raising production. While full compliance with Saudi Arabia’s request would see production rise by up to one million barrels per day (bpd), the market consensus appears to have settled on more like a 600,000 bpd increase.
3. In currencies, the USD will start the week on the back foot after the euro bounced off its lows to end the week. Amid higher oil prices, commodity bloc currencies strengthened and the AUD climbed back above US74 cents. And the Turkish lira is also up strongly after President Recep Erdoğan claimed victory in the weekend election.
4. Iron ore is back on the rise, while gold remains under pressure below $US1,270 an ounce. Bitcoin had a wild weekend, as prices briefly slumped below $US6,000 late yesterday in Australia, before rising sharply when North American trading activity resumed.
5. Amid the threat of lingering trade tensions, the People’s Bank of China has reduced the reserve amount of cash that major Chinese banks are required to hold. The measure is aimed at freeing up around $700 billion yuan ($US108 billion) of liquidity in China’s financial system, and will take effect from July 5.
6. The week ahead: In terms of key data and events, it’s a relatively quiet calendar both in Australia and abroad. Aside from an interest rate announcement in New Zealand on Thursday, key data will be highlighted by inflation prints for the US and Europe later in the week. The full calendar is here.
Have a great week.
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