US Stocks At All-Time High, Nasdaq Futures Gains For 8th Day After SNB Unexpectedly Cuts Rate

After hitting the beach during yesterday’s blistering Juneteenth holiday, the “buy everything” algos are back and bigger than ever, pushing futures to a fresh all time high with tech leading – as always – and small-caps lagging after the Swiss National Bank unexpectedly cut rates for a second time this year, setting the stage for much more monetary easing. As of 8:00am, S&P 500 futures are up 0.4%, while the ongoing AI frenzy pushed Nasdaq 100 futures 0.6% higher, and are now up for an 8th straight day, the longest stretch since November.

Bond yields are up 2-3bps even as they are on the brink of erasing this year’s loss after a rollercoaster first half; the US dollar is higher vs. most majors while the yuan slumped to a 2024 low as China’s plans for potentially the biggest shift in years in how it conducts monetary policy are starting to surface.  Commodities are mixed with oil and precious metals/Ags leading while base metals are weaker amid continued China weakness. Today’s macro data focus will be on jobless claims, housing data, and Fedspeak.

In premarket trading, it was all the usual suspects that were surging with NVDA surging +3%, or up some $100 billion , followed by MU +2.3%, SMCI +2.8%, MRVL +1%; And yes, all Mag7 names are higher pre-mkt. Here are this morning’s notable movers:

Accenture (ACN) rises 6% after posting 3Q results and providing forecasts.
Dell (DELL) gains 3% and Super Micro Computer (SMCI) climbs 4% after Elon Musk said in post on X that the companies will provide server racks for the supercomputer that the billionaire’s artificial intelligence startup xAI is building.
Harrow (HROW) rises 13% after providing a relaunch update for corticosteroid Triesence
Nvidia (NVDA) climbs 3% as the world’s most-valuable company extends its lead over fellow mega-cap tech firms Microsoft and Apple.
Ocular Therapeutix (OCUL) gains 7% after TD Cowen upgraded the stock to buy, saying enrollment for the firm’s eye disease trial is no longer an overhang.
Trump Media & Technology Group (DJT) declines 11% after the SEC declared effective a regulatory filing that could dilute shareholders on Tuesday.
Winnebago Industries (WGO) slips 4.8% after posting quarterly profit that that missed the average analyst estimate.

Traders will now look out for US weekly jobless claims data which is expected to show a small decrease from the previous print. Several Federal Reserve officials, including the Minneapolis Fed’s Neel Kashkari and the Richmond Fed’s Thomas Barkin, are also due to speak and could offer clues on when the US could kick off rate cuts.

“Rate cuts are very much in play for the remainder of this year and that should support risk assets,” said Guy Miller, chief market strategist at Zurich Insurance Company Ltd. “It’s encouraged investors that actually the rates environment is going to be supportive.”

In Europe, the Stoxx 600 benchmark climbed 0.6% led by technology, chemical and construction shares,  after the Swiss National Bank trimmed interest rates for the second time this year, encouraging hopes for policy easing across the developed world. The Bank of England held interest rares steady as expected but hinted more of its policymakers are close to backing cuts. Traders now price more than a 50% chance of a BOE rate reduction in August, knocking the pound lower and sending 10-year gilt yields down by three basis points. Here are the most notable European movers:

Evotec shares gain as much as 16%, the most intraday since January 2021, after Bloomberg News reported multiple buyout firms have been studying the German drug developer as a potential target.
Huhtamaki shares rise as much as 3.8% after being initiated with a buy recommendation at Citi, which says that unlike consensus it sees the consumer packaging product firm’s growth targets as achievable.
Lonza shares climb as much as 1.9% after Berenberg increased its price target on the Swiss maker of drug ingredients, saying the company’s long-term growth and margin prospects are “materially better than for the wider sector.”
Energean shares rise as much as 7.7% after the company agreed to sell its portfolio in Egypt, Italy and Croatia to Carlyle International Energy Partners for an enterprise value of up to $945 million, according to a statement. Analysts at Jefferies came to a mixed conclusion on the deal.
BIC slumps as much as 19%, the most on record, after the French maker of pens and lighters downgraded its sales guidance for the full-year based on a tougher-than-expected US market.
YouGov shares slump as much as 41%, the biggest drop since 2009, after it warned it has seen lower bookings than anticipated since the start of the second half of its financial year, resulting in its full-year guidance coming in below expectations.
Tate & Lyle shares fall 6.9% after the ingredients company struck a deal to buy pectin and specialty gum company CP Kelco for $1.8 billion.
Danone shares drop as much as 4.4% after the food-products company unveiled the next stage of its Renew strategy ahead of a capital markets day event.
Verbio shares fall as much as 9.3% as Hauck Aufhaeuser lowers its price target, making it no longer a Street high. Broker says it sees greenhouse gas quotas remaining under pressure and this weighing on the German biofuel firm’s FY24/25 results.
SSP shares fall as much as 5.5% after being downgraded to hold at Berenberg, based on potential headwinds to the food services company’s UK and Ireland rail business.

Meanwhile, France, the source of global market turmoil last week, raised €10.5 billion ($11.3 billion) in its first bond sale since President Emmanuel Macron called a snap election. Seen as a test of investor sentiment, the auction saw solid demand, supporting French bond prices, while the extra yield investors demand to hold French debt eased further off seven-year highs hit recently.

Earlier in the session, Asian stocks traded lower amid lackluster trading, dragged by Chinese shares. The regional moves contrasted with that of European peers, which gained after the Swiss National Bank delivered an interest rate cut. The MSCI Asia Pacific Index dropped as much as 0.4% after gaining 1.7% over the previous two sessions. The biggest drags on the gauge included Tencent, Toyota and Alibaba. Hong Kong benchmarks pared Wednesday’s sharp gains as traders eye more capital market reform policies. Mainland China shares fell for a second session. Shares in Japan declined amid lingering political risks in Europe, while the Nikkei advanced.

In FX, the Swiss franc fell 0.7% against the dollar and is at the bottom of G-10 FX  after the Swiss National Bank cut interest rates for the second straight meeting and lowered its inflation projections. The Norwegian krone is the best performer, rising 0.2% after the Norges Bank stood pat on rates and said it will probably need to keep them at current levels for the rest of the year. The pound is down 0.2% ahead of the Bank of England decision. Nvidia shares rise 3.4% in premarket.  Treasuries fall, with US 10-year yields rising 3bps to 4.25%. Bunds also dip and underperform their French counterparts, narrowing the 10-year OAT-bund spread by ~2bps. Oil prices are steady, with WTI trading near $81.40 a barrel. Spot gold rises ~$6 to around $2,334/oz. Silver rises 1.4%.

In rates, treasuries reopened after Wednesday’s Juneteenth holiday with yields cheaper by around 2bp across the curve in early US session. Early weakness was pared slightly as gilts advanced after Bank of England kept rates on hold but hinted it may soon back cuts. European bonds were pressured lower from the London open, weighing on Treasuries despite healthy demand for a French bond sale. Treasury 10-year yields trade around 4.24%, cheaper by ~2bp vs Tuesday’s close, with bunds lagging slightly while gilts outperform by around 4bp in the sector. Late Tuesday the US 2s10s spread flattened sharply, with the downside move falling just short of 50bp inversion, a level not seen since December. Also Thursday, a $21b 5-year TIPS reopening auction takes place at 1pm New York time.

In crypto, bitcoin is modestly firmer and holds above $66k, with Ethereum also gaining and now above USD 3.5k. Italy is looking at adopt measures to enhance surveillance over risks surrounding crypto assets, according to Reuters sources; including large fines for those who manipulate the market.

Looking to the day ahead now, and we’ll get the Bank of England’s latest policy decision, along with remarks from the Fed’s Kashkari, Barkin and Daly. The ECB will also be publishing their Economic Bulletin. Elsewhere, US data releases include Q1 current account balance, May housing starts/building permits, June Philadelphia Fed business outlook and initial jobless claims (8:30am). Fed officials scheduled to speak include Kashkari (8:45am), Barkin (4pm) and Daly (10:15pm). Meanwhile in Europe, there Germany’s PPI for May, and the European Commission’s preliminary consumer confidence indicator for the Euro Area in June.

Market Snapshot

S&P 500 futures up 0.3% to 5,509.00
STOXX Europe 600 up 0.3% to 515.62
MXAP down 0.2% to 180.70
MXAPJ little changed at 572.28
Nikkei up 0.2% to 38,633.02
Topix down 0.1% to 2,725.54
Hang Seng Index down 0.5% to 18,335.32
Shanghai Composite down 0.4% to 3,005.44
Sensex up 0.1% to 77,421.97
Australia S&P/ASX 200 little changed at 7,769.44
Kospi up 0.4% to 2,807.63
Euro down 0.3% to $1.07153
Brent Futures up 0.2% to $85.25/bbl
Gold spot up 0.2% to $2,333.50
German 10Y yield little changed at 2.43%
US Dollar Index up 0.24% to 105.50

Top Overnight News

China sitting on the largest copper glut in years as manufacturers dial back consumption amid a price spike and soft consumer demand. FT
China’s PBOC head said the central bank is studying how to implement bond trading, but rejected comparisons to quantitative easing. BBG
Chinese automakers call for Beijing to impose a 25% tax on large European cars, the latest sign of escalating tensions between Beijing and Brussels. BBG
AAPL is searching for a local Chinese AI partner (it’s held talks w/Baidu, Alibaba, and Baichuan AI) to help launch Apple Intelligence in the country. WSJ
SNB surprises markets with a 25bp rate cut at its Thurs meeting (most assumed rates would stay unchanged), w/the reduction spurred by a further easing of inflation pressures. RTRS
France saw healthy demand as it tested the market with a €10.5 billion debt auction — the first since Emmanuel Macron’s election call rattled investors. Bids across all four sales were 2.41 times the total amount sold. BBG
Russia’s Vladimir Putin arrived in Vietnam from North Korea, where he and Kim Jong Un revived a Cold-War era agreement to provide immediate military assistance if one of them is attacked. BBG
Nasdaq is increasing scrutiny of small IPOs from China and Hong Kong to avoid wild swings, people familiar said. BBG
Bobby Jain signaled that efforts to raise cash for his new hedge fund faced competition from private credit firms.  BBG

Central Banks

SNB cut the Policy Rate by 25bps to 1.25% (vs split expectations between a 25bps cut and a hold); reiterates SNB is willing to be active in the FX market as necessary. SNB Chairman Jordan says “underlying inflation pressure has decreased; we are also willing to be active in the foreign exchange market as necessary. We do not give any forward guidance regarding interest rates; will adjust policy rate to ensure inflation rate stays in range of price stability; FX interventions can be in both directions”.
Norges Bank maintains Key Policy Rate at 4.50% as expected; “the policy rate will likely be kept at that level for some time ahead”; will be a need to maintain a tight monetary policy stance for somewhat longer than previously projected. Norges Bank Governor says neutral long-term interest rate now estimated at 2-3%, slightly higher than before.
Brazil Central Bank maintained the Selic Rate at 10.50%, as expected, with the decision unanimous, while it stated it decided to interrupt the easing cycle due to the uncertain global scenario, resilient activity in Brazil, higher inflation projections, and unanchored inflation expectations. Furthermore, it said monetary policy should continue being contractionary until the consolidation of both the disinflation process and the anchoring of expectations around the targets, as well as noted that the committee will remain vigilant and future changes in the interest rate will be determined by the firm commitment to reaching the inflation target.
BoC Minutes noted that the Governing Council considered the merits of waiting until the July 24th meeting to cut rates prior to the June 5th rate announcement and while members recognised the risk that progress on inflation could stall, there was consensus indicators showed enough progress to warrant a cut. Furthermore, members agreed that any future monetary policy easing would likely be gradual and the timing of cuts would depend on the data and implications for the future path of inflation.
Chinese Loan Prime Rate 1Y (Jun) 3.45% vs. Exp. 3.45% (Prev. 3.45%); 5Y (Jun) 3.95% vs. Exp. 3.95% (Prev. 3.95%)

A more detailed look at global markets courtesy of Newsquawk

APAC stocks were subdued in rangebound trade amid a lack of catalysts and following the US holiday lull. ASX 200 was lacklustre as underperformance in defensives outweighed the gains in energy and real estate. Nikkei 225 retreated with weakness in the heavy industries clouding over exporter optimism. Hang Seng and Shanghai Comp. were lower with the former choppy amid resistance around 18,500, while the mainland was uninspired after China’s Loan Prime Rates were unsurprisingly kept unchanged and the PBoC also reverted to a tepid liquidity operation.

Top Asian News

PBoC will make clear it will start to use a short-term interest rate as its main policy rate after reducing the importance of the MLF rate as a policy benchmark, according to PBoC-backed Financial News citing unnamed industry people.
Toyota (7203 JT) is to reportedly halt six production lines at five plants in Japan from Thursday evening amid parts shortages; will decide on Friday whether to resume production.
Japanese Top Currency Diplomat Kanda says will thoroughly respond to excessive FX moves, via JiJi; no limit for FX intervention resources. FX market determined by various factors including rate gap. Needs to pay close attention to impact on FX market from central banks’ policy decision. Says FX intervention announced in end of May was quiet effective in responding to excessive FX moves caused by speculators.

European bourses, Stoxx 600 (+0.3%) are entirely in the green, having initially opened on a tentative footing; stocks caught a bid after the SNB cut rates, though are currently now off worst levels. European sectors hold a strong positive bias, though with the breadth of the market fairly narrow. Tech takes the top spot, lifted by gains in the Chip names, whilst Food Bev & Tobacco underperforms. US Equity Futures (ES +0.3%, NQ +0.6%, RTY +0.1%) are entirely in the green, with clear outperformance in the NQ, which has been lifted by Nvidia (+3.4% pre-market).

Top European News

Savanta poll for Telegraph predicts UK PM Sunak to lose his seat at the July 4th election.
French PM Attal says Macron’s Centrist Camp pledges to reduce electricity bills by 15% next winter; pledges to link pensions to inflation.
France’s National Rally President Bardella says we will bring out an amended 2024 budget this summer.
Germany’s IFO raises 2024 GDP growth forecast to +0.4% (prev. +0.2%)
ECB’s Knot says recent uptick in May inflation figures remind us disinflation is bumpy; On core inflation, not all signs are green yet; may still be transmission in the pipeline; recent shift in market shows road to inflation target is bumpy. There is strong case for using projection meetings to recalibrate policy stance. Can look through small deviations from target as long as ECB responds especially forcefully to larger deviations. Optimal policy path is broadly in line with just under three cuts in 2024, as prices into ECB projections.
ECB’s Centeno says “let’s leave all options to July, and naturally September as well”, adds we cannot risk undershooting when asked on where rates could go.

FX

DXY is firmer vs. all major peers with the index propped up by losses in CHF, JPY and EUR. Fresh fundamentals for the US have been lacking with focus on today’s weekly jobs figures after last week’s unexpected uptick.
After holding steady in recent sessions, EUR has lost some ground to the broadly firmer USD and moving ever closer to the 1.07 mark. If breached, this could open up a test of the WTD low at 1.0686 and the monthly low at 1.0667.
Cable is currently pivoting around the 1.27 level ahead of the BoE rate decision. A hawkish outcome could see the pair attempt to print a new weekly high above 1.2739, whilst a dovish release could see the pair try and forge a new low for the month below 1.2656.
JPY is softer vs. the USD in a continuation of the trend seen since June 13th. Officials continue to jawbone the currency but with little in the way of success. USD/JPY breached its 14th June high at 148.25, now as high as 158.44 with not much in the way of resistance until 159.
Antipodeans are both broadly steady vs. the USD. AUD/USD has paused its recent run of gains after printing a WTD peak at 0.6679. NZD was unable to capitalise on better-than-expected GDP metrics and is now marginally softer vs. the USD.
CHF is the laggard across the majors after the SNB cut rates in what was expected to be a finely poised decision. The SNB also reiterated its willingness to intervene in FX markets as necessary; EUR/CHF spiked higher from 0.9486 to 0.9548.
Norges Bank maintained its key policy rate at 4.50% as expected, noting that “the policy rate will likely be kept at that level for some time ahead”. NOK saw marked immediate appreciation on the hawkish adjustment to forward guidance, with EUR/NOK falling from 11.3338 to 11.2928.
PBoC set USD/CNY mid-point at 7.1192 vs exp. 7.2653 (prev. 7.1159).

Fixed Income

USTs are softer but comfortably within yesterday’s ranges where newsflow was light on account of the US holiday, as attention turns to US IJC & Philly Fed data, as well as a few Fed speakers. Holding at the low-end of a 110-16 to 110-26+ range.
Bunds saw a modest, but shortlived, spike higher following the SNB’s 25bps cut lifting Bunds to their 132.59 session peak (vs current 132.30), and were unreactive to softer-than-expected PPI figures.
Gilts are softer but faring marginally better than peers into the upcoming BoE policy announcement. Currently in a narrow 25 tick band which has seen Wednesday’s 98.41 base breached to a current 98.32 base.
OATs fell from 123.98 to 123.78 following the French auction, given that the smaller than usual covers for the line; however, the sale was at the top end of the amount on offer, and as such, OATs pared much of the pressure.
Spain sells EUR 5.471bln vs exp. EUR 4.5-5.5bln 3.50% 2029 Bono Auction & 0.70% 2032, 3.45% 2034 ODE.
France sells EUR 10.5bln vs exp. EUR 8-10.5bln 2.75% 2027, 5.50% 2029, 2.75% 2030, 0.00% 2032 OAT.

Commodities

Crude is modestly firmer amid a lack of macro impulses and following yesterday’s US Juneteenth market holiday. Brent Aug holds above USD 85/bbl.
Firm trade across precious metals (ex-palladium) despite the stronger Dollar and with major macro updates light whilst risk events ahead include the BoE and US IJC. Spot gold reached a high of USD 2,345.75/oz after topping a set of resistance levels including yesterday’s high (2,335/oz)
Mixed trade across base metals with copper moving sideways despite the broader Dollar strength but amid the tentative market tone as traders await the return of US players.
Norway’s Prelim May Oil Production 1.689mln BPD (prev. 1.854mln M/M); Gas Production 10bln cu metres (prev. 10.4bln M/M)

Geopolitics: Middle East

“Israeli officials were in Qatar this week in attempt to nail down hostage deal – report”, according to Times of Israel.
“Israeli Foreign Minister: We must stop Iran now before it is too late”, according to Sky News Arabia.
Lebanon’s Hezbollah chief said nowhere in Israel will be safe from the group’s attacks in case of war including targets in the Mediterranean and if war is ‘imposed’ on Lebanon, the group will fight with ‘no rules and no ceilings’, while Cyprus allowing Israel use of its airports means that it has become a part of the war and that Hezbollah will deal with it as such. In relevant news, Hezbollah announced it was targeting the positions of Israeli soldiers in Jal Al-Alam, Al-Baghdadi and Al-Raheb, according to Sky News Arabia.
Nine Palestinians were killed in an Israeli air strike targeting a group of citizens and merchants waiting for aid in Gaza, according to medical sources cited by Reuters.
Israeli media said the US told Israel that Qatar is close to imposing sanctions on Hamas to resume negotiations, according to Sky News Arabia.
A meeting between US envoy Hochstein and Israeli PM Netanyahu was said to be bad and Hochstein said accusations about withholding weapons are false, according to Axios citing informed sources. Furthermore, US officials said the new dispute between Netanyahu and the Biden administration hinders US-Israeli diplomatic efforts to calm tensions on the border between Lebanon and Israel, while it was reported by Sky News Arabia that President Biden wants to meet with Israeli PM Netanyahu as soon as possible.
US Central Command said it conducted an air strike in Syria that killed a senior Islamic State official on June 16th.

Geopolitics: Other

North Korean leader Kim said Russian President Putin’s visit was a meaningful step in developing bilateral ties and protecting world peace and stability, while it was noted that each country is to provide all available military and other assistance if the other faces armed aggression under the North Korea-Russia pact, according to KCNA.
Japanese Chief Cabinet Secretary Hayashi expressed grave concern that Russian President Putin did not rule out military technology cooperation at the summit with North Korean leader Kim, while he added Putin’s comment that the UN Security Council should review North Korean sanctions is utterly unacceptable.
NATO Secretary General Stoltenberg warned there will be consequences for China if it continues to support Russia’s war economy, according to FT.
US Secretary of State Blinken discussed with his Philippine counterpart China’s actions in the South China Sea which Manila and Washington said was escalatory, according to Reuters.
Ukrainian drone attacks by SBU Security Agency caused fires at oil depots in Russian regions of Tambov and Adygeya, according to Kyiv intelligence source cited by Reuters

US Event Calendar

08:30: June Initial Jobless Claims, est. 235,000, prior 242,000
June Continuing Claims, est. 1.81m, prior 1.82m

08:30: May Housing Starts, est. 1.37m, prior 1.36m
May Building Permits, est. 1.45m, prior 1.44m
May Housing Starts MoM, est. 0.7%, prior 5.7%
May Building Permits MoM, est. 0.7%, prior -3.0%

08:30: June Philadelphia Fed Business Outl, est. 5.0, prior 4.5
08:30: 1Q Current Account Balance, est. -$206.8b, prior -$194.8b

Central Bank speakers

08:45: Fed’s Kashkari Participates in Fireside Chat
16:00: Fed’s Barkin Speaks on Economic Outlook
22:15: Fed’s Daly Participates in Panel Discussion on AI

DB’s Jim Reid concludes the overnight wrap

With Hollywood and the rest of the US on holiday yesterday, attention was back on Europe again as the European Commission criticised seven member states for running deficits that were too high, and they outlined the first steps that could open an Excessive Deficit Procedure (EDP). Significantly, that group included both France and Italy, who are running deficits above the 3% limit set out in the EU treaties. On one level, this might seem insignificant for markets given we already knew about the deficit issue and it was priced in. But it’s particularly important right now, because we’ve got the French parliamentary elections on June 30 and July 7, where both Marine Le Pen’s National Rally and the left-wing alliance have indicated that they’d take a more assertive stance against the EU, raising the risk of more clashes over the months ahead. Indeed, the Franco-German 10yr spread widened by another +1.9bps yesterday at 78.9bps, which is its highest closing level since November 2012. There is €10.5bn of French 3 to 8yr bonds to be auctioned this morning – the first since the elections were called 11 days ago. So this will be a good test of demand.

Back to the potential EDP, the Commission unveiled a report looking into several member states, which is the first step in opening such an action. The next steps won’t happen until July, where the Economic and Financial Committee has to provide an opinion on the report, and any recommendations would come in November, so there’s still some way to go in this process. But the report pointed out that in France and Italy, deficits were projected to remain above the limit, with France’ deficit expected to be at 5.3% in 2024 and 5.0% in 2025. Italy’s numbers were a bit lower, at 4.4% in 2024 and 4.7% in 2025, but still above the 3% limit. Other countries were also mentioned, but France and Italy are two of the three biggest Euro Area economies alongside Germany, so what happens there is particularly important, and the treaties even permit the EU to impose fines if the deficits aren’t corrected.

European markets struggled against this backdrop, particularly in France. This meant the CAC 40 fell -0.77% and underperformed other indices, including the STOXX 600 (-0.17%), the DAX (-0.35%) and the FTSE MIB (-0.29%). Sovereign bonds also lost ground across the board, with yields on 10yr bunds (+0.9bps), OATs (+2.7bps) and BTPs (+5.0bps) all moving higher.

Over in the UK, there was another important milestone yesterday, as CPI inflation fell exactly in line with the Bank of England’s target, reaching +2.0% in May as expected. However, some of the details of the report were less favourable, as core CPI was higher at +3.5%, while services inflation surprised on the upside at +5.7% (vs. +5.5% expected), and that’s one of the stickier categories. As a result, investors dialled back the chance that the Bank of England would cut rates by the August meeting, with the chance falling from 52% to 34% by the close.

The Bank of England will remain in focus today, as they’re announcing their latest policy decision at 12pm London time. In terms of what to expect, it’s widely anticipated they’ll leave rates unchanged at 5.25%. In his preview (link here), DB’s UK economist thinks there’ll be a 7-2 vote split, with 2 in favour of a cut. He also has a chartbook out yesterday (link here) after the UK inflation print, where he points out that the report will raise the bar for a summer rate cut.

Staying on the UK, there are now just two weeks left until the general election on July 4, and yesterday saw another MRP poll from YouGov released. That showed Labour winning a 200-seat majority, with 425 seats in the House of Commons, beating their previous record in the 1997 landslide won by Tony Blair. The poll also showed the Conservatives falling to 108 seats, down from 365 at the last election. The Lib Dems significantly strengthened their presence as well, up to 67 seats, which would be the most seats for them or their predecessor Liberal Party since 1923. In addition, the poll saw Nigel Farage winning a seat in Parliament for the first time, with his Reform UK party on 5 seats.

Over in the US, markets were closed for the Juneteenth holiday, but futures were pointing to a more resilient performance relative to Europe, staying relatively flat all day. There wasn’t much data either, although the NAHB’s housing market index for June fell back to a 6-month low of 43 (vs. 46 expected). This morning S&P and Nasdaq futures are +0.12% and +0.32% higher respectively with today being the first day with Nvidia opening as the largest company in the S&P 500 and with it the world.

Asian equity markets are mostly drifting lower this morning with the Nikkei (-0.64%) leading losses followed by the CSI (-0.49%), the Hang Seng (-0.40%) and the Shanghai Composite (-0.28%). The PBOC kept its one-year loan prime rate (LPR) unchanged at 3.45% while the 5-yr LPR – a reference rate for mortgages remained intact at 3.95%. China also set the yuan’s daily reference rate at 7.1192 per dollar, its weakest since November. US treasuries have resumed trading following yesterday’s holiday with yields on 10yr USTs moving +2.5bps higher to trade at 4.25% as we go to print.

Early morning data showed that New Zealand’s economy exited a technical recession, growing +0.2% q/q in Q1 (v/s +0.1% expected) as against a -0.1% contraction in the previous quarter. GDP rose +0.3% from the year-earlier quarter, beating the +0.2% estimate. Following the data release, the New Zealand dollar strengthened (+0.24%) against the dollar before retracing to trade little changed at $0.6133.

To the day ahead now, and we’ll get the Bank of England’s latest policy decision, along with remarks from the Fed’s Kashkari, Barkin and Daly. The ECB will also be publishing their Economic Bulletin. Elsewhere, US data releases include the weekly initial jobless claims, housing starts and building permits for May, the Philadelphia Fed’s business outlook for June, and the Q1 current account balance. Meanwhile in Europe, there Germany’s PPI for May, and the European Commission’s preliminary consumer confidence indicator for the Euro Area in June.