Equities trade higher overnight as positive Brexit news spurs markets
The big story yesterday was from the UK, Prime Minister Boris Johnson looks like he may a draft legal document together but the key concern at the moment is whether the DUP will back the deal. DUP party leader Arlene Foster was quoted as saying that “it would be fair to indicate gaps remain and further work is required”. Elsewhere, overnight equities traded well. The Nikkei 225 (1.20%) and ASX (1.27%) rose while the Shanghai Comp. dropped 0.31%. Chinese equities struggled slightly as the government said there would be strong countermeasures if the US enacted a bill supporting protesters in Hong Kong.
In commodities markets, gold continued to struggle as the picture becomes rosier in equities. The pullback in gold come despite some weakness in the USD so its clear that it is a risk on related play.
Copper has dipped under $2.60/lb again after the comments from China. Traders are still worried that nothing concrete came from the trade talks but base metals will clearly be headline-driven for now.
Oil markets pulled back 0.10% overnight after struggling again yesterday. The IMF’s downgrade to global growth projections weighing on sentiment. API data has been moved to today so keep an eye on that release late in the session.
Today is another busy one as we get CPI data from UK, EU and Canada. We will also get US retail sales, DoE's, API's EU trade balance, UK RPI and comments from BoE's Carney, Fed's Evans, ECB's Weidmann RBA's Debelle and Fed's Mester.