Daily summary: Global stocks rise on upbeat PMI data and trade optimism

• Nasdaq hits record high
• European stocks at 2-week high
• Trump reassured that the US-China trade deal is fully intact

European indices finished today's session sharply higher after recent PMI data came in above analysts' expectations as many EU members eased coronavirus lockdown restrictions. At first glance, better data may suggest that the situation in Europe returns to normal faster than previously assumed, but it is worth noting that markets are probably too optimistic about these figures. One need to remember that these reports compare the situation month to month. So if the majority of respondents think that the situation is better than a month earlier, then PMI will show a high reading. However, it is still not reliable compared to January or February. Therefore, investors should pay more attention to the spending data. If there is improvement here, then it will be a factor indicating that the economy is recovering. On the corporate front, Wirecard (WDI.DE) shares rose for the first time since  the financial scandal emerged. According to Munich prosecutors, former CEO Markus Braun has been arrested. During today's session DAX soared 2.3%  higher, while both CAC 40 and FTSE 100 added 1.10%

 

US indices also rose on Tuesday amid better than expected PMI data. The Nasdaq 100 (US100) hit a fifth record high this month and S&P 500 (US500) is just about 7% below its Feb. 19 record high. Apple Inc (AAPL.US) is one of the top performers. Recently at least three brokerages raised its price targets after company announced it would use its own chips for Mac computers. Investors’ risk appetite  improved after US President Trump confirmed  via Twitter that the US-China trade deal is fully intact following confusing comments from White House trade adviser Peter Navarro. Meanwhile, United States saw a 25% increase in new cases of COVID-19 in the week ended June 21 compared to the previous seven days, with Arizona, Florida and Texas experiencing record surges in new infections, according to Reuters. Texas Governor Greg Abbott declared the COVID-19 is spreading at an unacceptable rate, warning that additional measures are going to be necessary to contain the spread of the virus.

 

Gold price is rising for the third straight session and today hit a seven-year high of $1,767 per ounce. Gains came despite a rise in equities driven by US President Trump tweet regarding the US-China trade pact.

 

Oil prices reached their highest levels since beginning of March, as investors welcomed the fact  that OPEC is making sure that other countries which signed to its deal regarding production cuts actually complies with it. According to Newswires,  Iraq, Nigeria, Angola, and Gabon have now all submitted their plans for compliance with the production cut.  American Petroleum Institute will provide its weekly report on U.S. crude oil inventories, against a backdrop of rising coronavirus infections  in big oil producing states such as Texas and Oklahoma.

Wednesday is light in terms of macroeconomic releases.  RBNZ rate decision will be the key release of the Asian session while German IFO will be on watch during European trading hours. Apart from that, EIA crude inventory report will be published during US session.

USD/JPY - US Dollar had been trading under pressure today.  Currency pair is approaching 105.95 support level. If sellers will manage to break below it,  then downward move toward 104.55 may accelerate. However if buyers will manage to regain control on the market, then strong resistance can be found around 108.68. Source: xStation5

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