Europe Summary and Highlights 8 Jun
Consolidation, after Friday's sharp moves and dollar break higher
Focus remains on Iran, yields, and tech momentum
USD/JPY still dancing on the edge
European morning session
Consolidation of the sharp dollar moves seen on Friday, though still with risks of further extension in due course. Pullbacks to big figure areas such as 1.15 on EUR/USD holding as market unwinds intraday oversold conditions.
USD/JPY has another intraday pullback as it dances on the edge of the perceived higher risk intervention zone leaving it prone to noisy intraday positional swings. Blips back under160 from 160.20-30 before settling at the figure.
Nasdaq future also currently consolidates the mini-shakeout, up around 0.6%, following the steep corrective pullback ahead of the weekend. US2s stay on backfoot, as high as 4.2%.
Oil holds +$3.5-4, but in recent standard range, following latest Israel strikes and amid US de-escalation focus.
German orders -3.8%m/m sa (mkt -2%), 1.6% y/y.
EZ Sentix index -13.4 from -16.4 (mkt -14.6), slight improvement led by expectations.
UK REC survey: permanent staff placements fell to 44.1, temporary 52.2 from 50.4, expanding (highest since April 2023)
UK IDR pay settlements hold at 3.5% in 3mths to Apr
Asia Session
The second read of Japan Q1 annualized GDP shows a revision lower at 1.8%, from 2.1%. While it is a revision lower, the figure remains healthy as we see private consumption data unchanged. Nevertheless, market participants' focus would rather be on intervention threat as USD/JPY broke 160 figure and looks set for higher rounds with haven USD bids. We do not see an imminent intervention but could not rule out one if the rally within this week past another one or two figure. USD/JPY is trading 0.02% higher at 160.30 after opening a few pips lower.
More crossfire is reported after Trump ask Netanyahu to restrain from attacking. Iran says that Israeli strikes have damaged its Karoon Petrochemical complex while the West Bank and Central Israel are being targeted. It doesn't look like a deal is close with missiles flying around but U.S. equities are taking a breather after Friday's slaughter while regional equities face a bloodbath. AUD/USD opened lower but managed to close the gap. Yet, it reverted 0.02% lower at 0.7044. NZD/USD is trading 0.12% higher while USD/CAD is unchanged despite oil jumping by more than 4 USD/b. Else, EUR/USD is up 0.08% and GBP/USD unchanged . Major currency pairs have at least once cloesd their opening gap.