Asia Summary and Highlights 4 June
Major equity indexes perform individually
Israel and Lebanon agreed to implement a ceasefire and establish security zones
Asia session
U.S. announced that Israel and Lebanon have agreed to implement a ceasefire and establish security zones. However, it is conditional on a complete cessation of Hezbollah fire and the full evacuation of Hezbollah operatives from the south Litani sector, which has historical difficulties. The ceasefire looks set to be the prelude of a U.S.-Iran deal. USD/JPY is testing the 160 figure at 159.96.
Major equity indexes are performing individually as market participants are undecided about the latest development. While it is welcome news for a potential Israel-Lebanon ceasefire, it is always about Hezbollah, instead of Lebanon. Mostly have been anticipating a deal for weeks and seems to refuse on building further position on hollow headlines. AUD/USD is trading 0.04% higher at 0.7130. NZD/USD is trading 0.25% higher while USD/CAD rises 0.03% with oil lower. Else, EUR/USD is up 0.13% and GBP/USD is up 0.1%.
North American session
With Middle East tensions rising after a strike on Kuwait Airport, the USD was stronger as UST yields and oil picked up and equities slipped. USD/JPY nudged cautiously above 160 while EUR/USD stabilized near 1.16. EUR/GBP rose to .8645 from .8635 while EUR/CHF advanced to ,.9190 from .9165. AUD/USD slipped to .7130 from .7160 while USD/CAD rose to 1.39 from 1.3860.
While focus was elsewhere US data was on the firm side, with May’s SADP employment report up by 122k and May’s ISM services index rising to 54.5 from 53.6. The Fed’s Beige Book was marginally stronger on activity and significantly stronger on prices than in the last report, but Fed’s Williams maintained a moderate tone, still seeing no urgency to move rates.