To the scoreboard:
- Dow: 25,175.31 -25.89 (-0.10%)
- S&P 500: 2,782.49 +6.86 (+0.25%)
- AUD/USD: 0.7472 -0.0118 (-1.42%)
- ASX200 SPI futures (June contracts): 6,058 (+33)
1. Euro gets poleaxed: The European Central Bank said its $US3 trillion bond-buying program will end in December. The ECB also signaled steady rates through summer of 2019, lowered its growth forecast, and increased its inflation expectations for the next two years. The euro tumbled against the USD following the announcement:
2. The ECB’s lean towards a dovish taper comes on the heals of yesterday’s more hawkish announcement by the US Fed, and weakness in the euro extended to the UK pound and the Aussie dollar, which was the worst performer among the commodity bloc currencies overnight. It fell by 1.4% against the greenback and is back below US75 cents this morning.
3. Global stocks were mixed in the wake of the ECB announcement, as traders in the US adopted a more cautious tone while European markets got a lift from weakness in the euro. In a similar fashion, the fall in the Aussie dollar has seen traders mark the local index higher ahead of this morning’s open.
4. The US Fed’s upbeat assessment of the economy was reaffirmed by strong retail sales data, which rose at the fastest pace in six months in May. US weekly jobless claims also unexpectedly dropped. Benchmark US 10-year bond yields edged lower to 2.93%.
5. Ethereum prices are up 9% this morning after US regulators deemed it was not a security. which means exchanges that facilitate trading of ethereum don’t have to register with the SEC. The gains extended to other major cryptos, with Bitcoin up by around 5%.
6. And in commodities, iron ore prices just surged out of nowhere. Meanwhile, benchmark brent crude prices fell by 1.1% after Russia announced plans to increase production by 1.5 million barrels a day, at the same time as the Russian national team thumped Saudi Arabia — the world’s biggest oil producer — by a score of 5-0 in the opening match of the World Cup.
Here’s a look at the upcoming economic calendar:
- The Bank of Japan makes it’s interest rate announcement.
- RBA’s Luci Ellis gives a speech at an infrastrucutre conference in Sydney.
- US industrial production and Uni Michigan consumer confidence survey.
- Eurozone inflation data.
Have a great weekend.