Stocks climb on stimulus support, NZD awaits RBNZ rate decision
The latest wave of central bank stimulus continues to find its way into world stock markets. New purchases from the Bank of England found their way into European bourses sparking breakouts for both the FTSE and the DAX. Meanwhile, neutral to moderately disappointing economic news out of the UK knocked GBP back on its heels and cable back under $1.3000 for a time.
Overall, traders remain in risk on mode with indices that have been lagging behind the US drive to all-time highs still having scope for catch up advances. This sentiment could dominate today’s Asia Pacific trading with scheduled news flow relatively light. We could see positioning in NZD as well today as traders look toward tomorrow’s RBNZ meeting where the central bank is expected to echo the RBA’s recent 0.25% interest rate cut. Recent trading in NZD suggests that unlike the economists, traders are thinking a 50-50 chance of a cut so we could see action on the news regardless of the decision.
Crude oil paused for a rest after spiking Monday on speculation producers could take another crack at trying to cap production. Late in the day API inventories rose setting up for potential volatility Wednesday morning with the street expecting a decrease in DOE oil and gasoline inventories as we move into the back half of summer driving season.
Walt Disney $1.62 vs street $1.61
Significant announcements released overnight include:
US API crude oil inventories 2.1 mmbbls
UK industrial production 1.6% as expected
UK NIESR GDP estimate 0.3% vs street 0.4% and previous 0.6%
US Q2 nonfarm productivity (0.5%) vs street 0.4% and previous (0.6%)
US Q2 unit labour costs 2.0% vs street 1.8%
Upcoming significant economic announcements include:
(Note: 11:30 am in Sydney/Melbourne is currently 1:30 pm in Auckland, 4:30 pm in Vancouver, 7:30 pm in Toronto/Montréal, 12:30 am in London and 8:30 am in Singapore)
8:00 am AEST NA REINZ house sales previous 6.0%
9:50 am AEST Japan machine orders street (4.5%)
9:50 am AEST Japan producer prices street (4.0%)
10:30 am AEST Australia consumer confidence previous 99.1
7:45 am BST France industrial production street (0.4%)
8:30 am BST Sweden industrial production street 3.7%
9:00 am BST Norway consumer prices street 3.8%
9:00 am BST Norway producer prices previous (9.7%)
10:30 am EDT US DOE crude oil inventories street (1.5 mmbbls)
10:30 am EDT US DOE gasoline inventories street (1.3 mmbbls)
9:00 am NZST Thu NZ RBNZ interest rate 0.25% cut to 2.00% expected
5:00 pm EDT Wed
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