Weekly Market Commentary
US Equity markets broke through record highs to close a week highlighted by the appearance of the Fed Chair, Jerome Powell, appearing before the House Financial Services Committee. In his testimony he confirmed that global economic 'crosscurrents were emerging' suggesting the Federal Reserve was likely to act at the coming meeting. This was enough to spur share markets to record levels. The US economy continues to charge and the Fed's telegraphed action would be to combat global crosscurrents. US Bond Yields contradicted the Fed's intentions, to add further monetary stimulus, rising while the Dollar meandered. The EUR traded 1.1270, while the GBP moved back to 1.2570, still mired in Brexit and the Tory leadership battle.
Chinese Trade data was better than expected, with Imports contracting 7.3%, while exports only fell by 1.3%. This was a positive message to markets considering the US/China trade war impact. The coming week will focus on global growth and inflation data, while EU and US economic sentiment will be watched closely. In the US the market will await the release of the Fed's Biege Book, a measure of economic performance and conditions, while Australian Employment data is likely to impact local markets. The situation in the Middle East continues to drive Oil prices up, trading above $60/barrel, while Iran's sabre rattling and the Wests response is the key to the extent of the crises.
Weekly Market Calendar
15/7 NZ Services PMI, NZ Migration, UK House Prices, NZ Dairy Auction, China Industrial Production, China Retail Sales, China House Prices, China GDP, Empire State Manufacturing
16/7 NZ CPI, Australia Consumer Confidence, RBA Minutes, UK Employment, EU Trade, German/EU ZEW Economic Sentiment, US Retail Sales, US Industrial/Manufacturing Production, NAHB House Market Index
17/7 UK CPI, EU CPI, US Weekly Mortgage Applications, US Homes Sales, US Building Permits, Biege Book
18/7 Japan Trade Exports/Imports, Australia Employment, UK Retail Sales, Philly Fed Survey, US Weekly Jobless Claims
19/7 Japan CPI, University of Michigan Economic Sentiment
Thanks and Regards
Paul Bettany
Collinson & Co
0406-744-923