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Analysts at ANZ Bank New Zealand Limited noted that markets await central bank meetings over the coming week while the US manufacturing data were upbeat, despite trade developments and Euro area manufacturing data were soft, consistent with a likely cautious tone from the ECB on Thursday night.

Key Quotes:

Global market overview:

“Trade headlines continue, with Trump again tweeting that tariffs are good for the US and China announcing a fiscal package to shore up growth yesterday. Nonetheless, markets were largely in consolidation mode overnight, ahead of central bank meetings over the next week (ECB, FOMC, BoJ and BoE) and the Trump-Juncker meeting on Wednesday. Fixed income markets treaded water with the US 10-year note down less than 1bp and the 10-year bund yield down 1bp to 0.39%. The USD underperformed, while GBP gained on news that UK Prime Minister May would lead Brexit negotiations from now on. Equities were well supported in light of solid earnings results. The S&P 500 rose 0.3%, the DAX rose 1.1%, the CAC 40 rose 1.0% and the FTSE rose 0.7%. WTI rose 0.8% to $68.50/bbl ahead of US inventories data. Gold was broadly unchanged.”


“Preliminary US PMI data for July points to ongoing firmness in manufacturing activity. The composite index dipped to 55.9 from 56.2, owing to a dip in the services index from 56.5 to 56.2. But the manufacturing index ticked up to 55.5 from 55.4, beating expectations and with the underlying details upbeat. Output rose to 54.6 (+0.6pt) with new orders increasing to 55.4 (+1.7pts) and employment at 54.7 (+0.8pts). The backlog of work increased to 53.9 (+0.7pts) and new export orders were at 49.7 (+0.4pts). Input and output prices ticked up to 64.2 (+0.8pt) and 57.8 (+1.4pts). US Richmond Fed manufacturing index held steady in July. Despite trade developments, manufacturers remain upbeat.”

Below expectations:

“Euro area composite PMI eased to 54.3 in July from 54.9. This was below expectations of 54.8. The drop was led by services, which dipped to 54.4 from 55.2. The manufacturing index has stabilised, increasing to 55.1 from 54.9. The data was bolstered by the German manufacturing PMI, which rose to 57.3 from 55.9.”