European cash equity markets are mostly higher ahead of the midway stage (FTSE +0.5%, DAX +0.3%, CAC +0.1%, FTSE MIB -0.5%). Basic resource stocks are among the best performers following optimistic remarks from both sides of the US-China trade negotiations. Bank stocks have lagged meanwhile after Swedbank dismissed their CEO Bonnesen amid the ongoing money laundering scandal. Optimism has also likely be tempered by recent Brexit related developments as the DUP refused to budge aND support May’s Brexit deal, even after she offered her resignation once it had passed. Sterling has subsequently declined with Gbp/Usd touching its lowest level since last Friday this morning at $1.3126. Elsewhere in FX, the Swedish Krona is the weakest of the G10’s following pretty dismal retail sales data while the Japanese Yen is the strongest as it maintain a safe-haven bid. There was not much reaction in the Euro meanwhile to broadly softer confidence indicators or comments from ECB Chief Economist Praet who said the Governing Council would need to see a solid monetary policy case before acting to mitigate the side effects of negative rates on banks. In commodity space, oil prices are in the red with US crude futures down -0.7% while spot gold has lost -0.2%. Looking ahead, futures are pointing to a relatively flat open on Wall Street. Data wise, we await US Q4 GDP, jobless claims and pending home sales plus possible comments from Fed Governor’s Clarida and Bowman.
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