9 Overnight Headlines and 9 Items for the Day Ahead

Market strategists at Nomura, including Rohit Garg, highlighted the following nine headlines overnight and said investors should keep they eye on the following nine items for the day ahead.

Headlines:

• Eurozone: Industrial production (wda) rose more than expected at 1.4% y-o-y (Consensus: 0.9%; Previous: 0.2%) in April.
• France: HICP inflation remained stable at 0.8% y-o-y (Consensus and Previous: 0.8%) in May.
• Germany: The wholesale price index dropped 0.9% y-o-y (Previous: -1.3%) in May.
• UK: The RICS house price balance increased to 57% (Previous: 55%) in May.
• Japan: April core machinery orders decreased less than expected by 9.1% m-o-m (Consensus: -10.8%)
• Australia: The economy lost 4.8k jobs (Consensus: 10k; Nomura: 15k) in May as full-time jobs increased by 22.2k, while 27k part-time jobs were lost.
• New Zealand: The RBNZ hiked the cash rate by 25bp, in line with expectations, to 3.25%.
• Korea: The Bank of Korea left rates unchanged at 2.50%, as expected.
• Indonesia: Bank Indonesia left the policy rate unchanged at 7.50%, as expected.

The Day Ahead

• Portugal HICP inflation in May.
• India Consumer price index: Food prices have so far remained benign during the summer season, so we expect CPI inflation to have moderated to 8.4% y-o-y in May from 8.6% in April. However, adverse base effects likely pushed up core inflation to 8.0% y-o-y from 7.8%, although we doubt this is the start of an uptrend, given tight fiscal and monetary policy.
• India Industrial production: We expect industrial production growth to have rebounded to 2.1% y-o-y in April from -0.5% in March, on stronger growth in upstream industries.
• Mansion House speeches by BoE Governor Mark Carney and Chancellor George Osborne
• US Initial jobless claims: The four-week moving average of initial jobless claims is at its lowest since mid-2007. This suggests that layoffs have bottomed out and more hiring will be needed to spur job growth. Consensus expects 310k claims for the week ending 7 June (previous: 312k).
• US Import prices: Import prices declined in April due to drops in petroleum, foods, and industrial supplies prices. On a year-on-year basis, import prices have declined for the majority of the past year, as inflationary pressures from abroad remain benign. Consensus expects import prices to inch up by 0.2% m-o-m in May (Previous: -0.4%).
• US Retail sales: A surge in vehicle sales in May should put strong upward pressure on headline retail sales, which increased by only 0.1% in April. On the whole, we forecast a 0.7% increase in headline sales (Consensus: 0.6%). Regional business surveys for May suggest that activity picked up that month. Therefore, we expect to see a 0.3% rebound in core retail sales (Consensus: 0.4%; Previous: -0.1%) growth, which stalled in April. We expect higher seasonal retail gasoline prices in May to also put upward pressure on sales. Therefore, we expect sales excluding autos to increase by 0.4% (Consensus: 0.4%; Previous: 0.0%).
• US Business inventories: Inventories at manufacturers increased by 0.4% in April, and wholesale inventories rose by 1.1%. Retail inventories are the only missing piece to business inventories for April. Consensus expects business inventories to increase by 0.4% in April. We expect inventories to contribute positively to GDP growth in Q2.
• US 30yr Treasury auction

You May Also Be Interested In

• Donald Trump Has Indicated to Economic Advisers he is Interested in a New Middle-class Tax Cut - Reuters
• US labor market stays resilient; housing regresses on higher mortgage rates
• Natural Gas Inventory 50 bcf vs 52 bcf Expected