Data released over the last 24 hours seriously questions the speed of any post-Covid-19 economic recovery. Weak retail sales in China, pulseless inflation in France and more jobless claims than expected in the US undermined the recent pro-growth market action. Bonds rallied and stocks fell. Industrial metals retraced, and oil dropped after the OPEC+ group agreed on production increases.

The numbers illustrate the economic challenges posed by secondary infection outbreaks. Central banks’ balance sheets are at record size, most interest rates are near zero, and governments have already committed to huge spending and support packages. Authorities have less room to move on any further economic damage caused by re-instituting containment measures.

The US corporate reporting season is also posing challenges. The majority of the early reports see companies easily beating significantly lower analysts’ estimates. Financial stocks in particular are exceeding forecasts. Overnight, both Morgan Stanley (EPS $2.04, f/c $1.14) and Bank of America (EPS $0.37, f/c $0.25) shone. However Netflix’s (EPS $1.59, f/c $1.82) big miss on earnings and lower subscriber growth projections for Q3 saw its shares tumble more than 10% in aftermarket trading.

Futures indicate a muted start to Asia Pacific trading. The US dollar rose for the first time in six trading days, putting pressure on regional currencies. A dimming currency outlook may see recent stock strength reverse today. Expansion in the New Zealand manufacturing sector in June may support its currency. Singapore’s non-oil domestic exports are expected to drop by 4.6%, potentially opening the door to a positive surprise.