It didn't take long for the big French election rally party to come to an end once Macron’s victory was confirmed. The CAC fell 1.5% as traders decided to take profits against the widely expected election result. With Marine Le Pen and the forces of populism having been defeated for now, traders breathed a small sign of relief then recognized that Macron is unlikely going to be able to do much even after French Parliamentary elections next month. The Dax
fell 0.8% while EURUSD fell after failing to regain $1.1000 on wider profit-taking. The Swiss Franc plunged over a penny against USD as capital continued to leave defensive havens with Gold and JPY also trading moderately lower.
North American markets spent the day in a steady state with traders taking a day to digest the implications of last week’s Fed meeting, flood of data announcements and political moves (health care passed out but likely to get stuck in Senate, budget deal passing sets the stage for a bigger fight in the fall). Energy stocks continued to bounce back as WTI stabilized from Friday’s big bullish reversal trading above $46.00.
Materials stocks, copper (down 1.8%) and resource currencies like AUD, NZD and CAD retreated Monday as yesterday’s weaker than expected Chinese trade report suggested a gloomy outlook for resource demand. This suggests that Australian miners could struggle again today with no new news to latch on to. Australian markets could be active around today’s retail sales report.
Open Text $0.45 vs street $0.50, sales $593M vs street $602M 15% dividend increase
Significant announcements released overnight include:
Canada housing starts 214K vs street 215K
UK Halifax house prices 3.8% vs street 3.6%
Germany factory orders 2.4% vs street 2.1%
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)
11:30 am AEDT Australia retail sales street 0.3% vs previous (0.1%)
7:00 am BST Germany industrial prodn street 2.6%
7:00 am BST Germany trade balance street €21.5B
8:30 am EDT Canada building permits street 2.8%
1:00 pm EDT FOMC Rosengren speaking
4:15 pm EDT FOMC Kaplan speaking
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