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Breakfast Bites - Fri Jul 7, 2023

Rise and shine everyone & Happy Friday!

Today’s big economic release is the US Job Report at 8:30am ET. The consensus estimate is for the unemployment rate to come in lower at 3.6% and NFP to increase by 225k.

US Equity Markets are flat to slightly lower. Yesterday was quite a day with yields surging off the back of strong labor market reports giving the market cause to think that the Fed will be serious about two more hikes and no cuts in 2023. Bitcoin, Gold and Oil are all marginally higher

Yields still remain elevated with the Yield Curve at -0.95%. 2Y holding around 5% after finishing yesterday at its highest level since the March banking crisis.

Asia and Australia

  • Asian equities ended lower Friday following a weak handover from the US overnight. Losses greatest in Australia as bond yields also jumped on rate expectations.

  • China Premier Li Qiang pledged to "spare no time" in implementing a batch of targeted policies to strengthen the economy's recovery from the pandemic.

  • Japan’s real wages remained negative for the 14th straight month, though improved to a 1.2% y/y decline from a revised 3.2% drop in April. Household spending remained depressed, falling 4.0% y/y in May vs expected 2.5% decline and 4.4% drop in April. Translated to the fourth consecutive slide in sequential terms. - This is not conducive to a revision in monetary policy.

  • China and South Korea maintain current bans on food imports from Japan due to safety concerns

  • Historic China Heat Wave Takes Toll on Lives and Crops

  • China likely to fine Ant Group at least CNY8B

Europe, Middle East, Africa

  • European equity markets mixed after moving off session lows. Basic Resources, Chemicals and Banks lead; Utilities and Media lag

  • No change in ECB's hawkish rhetoric with focus on tightening monetary conditions and bringing down inflation

  • Chemical sector challenges continue as Clariant issues profit warning.

  • German industrial production for May came in (0.2%) m/m vs 0% expected and 0.3% rise in April. Remains 5% below pre-pandemic levels

  • Data from accountancy firm BDO showed UK total like-for-like sales up 1.9% in June from last year's positive base of 8.4%.

  • UK Halifax house price data showed the biggest annual drop in price since 2011. Prices down 2.6% y/y in June, after 1.1% fall in May.

The Americas

  • Disney’s Bob Iger is looking for an extension on his contract to continue leading the company.

  • Quits rate continues to fall, signaling end of great resignation

  • US mortgage rate rises to 7.22% after positive economic data

  • Uber, DoorDash file lawsuit against NYC over minimum wage law


(news taken from Reuters, FT, Bloomberg; Calendar from Benzinga Pro)


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