Global Markets Move Higher After Better-Than-Expected European Flash PMI Data
Optimism is widespread today following the release of European Flash PMI data. Composite PMI for the Euro Area increased from 31.9 to 47.5 compared to analyst consensus which called for an increase to 42.4.
In the UK, Composite PMI was also much better than expected as it increased to 47.6 compared to analyst consensus of 41.
Today, the U.S. will release preliminary data on Manufacturing PMI, Services PMI and Composite PMI. Analysts expect that Services PMI will increase from 37.5 in May to 46.5 in June, while Manufacturing PMI will increase from 39.8 to 48. However, the market currently projects that PMI reports will be better than analyst expectations.
Not surprisingly, S&P 500 futures are gaining ground in the premarket session as traders bet on the economic recovery. At this point, S&P 500 looks ready to test recent highs above 3200 in the upcoming trading sessions.
Donald Trump Says That Trade Deal With China Is Fully Intact
Global markets had a rather volatile night after White House trade adviser Peter Navarro stated that the trade deal with China was over.
Later, Navarro said that his words were taken out of context and that he was speaking about current tensions while the deal remained in place.
In a tweet, U.S. President Donald Trump confirmed that the deal was intact, boosting global markets. The increase of U.S. – China tensions is a major risk for the world economy so traders are eager to buy equities on signs that the first phase of the trade deal between the two biggest economies will not get hurt.
Oil Settles Above $40
Oil has finally managed to get above the psychologically important $40 level. This move will provide support for the equity market since traders will rush to buy many oil-related equities.
The rally remains strong, and oil did not experience any material pullback since the bottom it reached back in April.
This major upside trend should provide support to the shares of oil majors like Exxon Mobil, BP, Chevron, Royal Dutch Shell which have pulled back from highs reached in early June.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
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