Thursday June 29th


Big banks, data in the spotlight on Wall Street

U.S. stock index futures pointed to a mixed open on Thursday after all big banks tested by the Federal Reserve got their capital repurchase programs approved. Morgan Stanley, JPMorgan Chase, Wells Fargo, Citigroup and Bank of America all traded at least 1 percent higher. For the first time in seven years, the Fed did not object to any of the capital plans of 34 banks it reviewed in the second part of the annual stress tests implemented in the wake of the financial crisis. Investors also geared up for a slew of data announcements during trade, while keeping an eye on the central banking sphere. In data news, the final read on first-quarter U.S. GDP showed the economy grew at an annualized rate of 1.4 percent, more than the previous read of 1.2 percent annualized growth. Meanwhile, weekly jobless claims came in at 244,000, slightly above expectations. Investors will likely be keeping a close eye on yields in the bond market, as yields move higher. Central bank-wise, investors are expected to be keeping an eye on central banks in Europe and the U.S., as well as moves in the currency space. On Wednesday, Reuters reported citing sources familiar with the matter, that European Central Bank President Mario Draghi intended to signal tolerance for a period of weaker inflation, not an imminent policy tightening, when his comments sent the euro higher this week. Meanwhile, Bank of England Governor Mark Carney said on Wednesday the central bank was likely to need to increase interest rates, adding that it would debate this "in the coming months". Looking to the Federal Reserve, St. Louis Fed President James Bullard will be at an OMFIF City Lecture in London, speaking about the U.S. economy and monetary policy. Oil futures were higher in morning trade, supported by news of a decline in U.S. crude output however glut concerns continue to stick around. At 8:35 a.m. ET on Thursday, U.S. crude was trading around $45.21, while Brent hovered around $47.81. In the political sphere, U.S. President Donald Trump will be meeting South Korean President Moon Jae-in at the White House, where they are expected to talk about cooperation on economic and global issues, as well as working together on North Korea-related issues. In Europe, bourses showed a mixed picture during early trade, while Asia-Pacific markets finished trade on a positive note. apan's Nikkei 225 rose 0.45 percent or 89.89 points to close at 20,220.3. South Korea's benchmark Kospi index traded higher by 0.55 percent or 13.1 points to close at 2,395.66. The Kospi opened at a record high and briefly crossed the 2,400 level earlier in the session.  Markets in greater China were also in the green. Hong Kong's Hang Seng Index closed up by 1.1 percent or 281.92 points at 25,965.42. On the mainland, the Shanghai Composite edged higher by 0.46 percent or 14.6973 points to finish at 3,187.8987 and the Shenzhen Composite advanced 0.472 percent or 8.8979 points to close at 1,892.2692. Gold eased on Thursday, surrendering early gains as signs this week that central banks might scale back their ultra-loose monetary policy pushed bond yields higher, though a decline in the dollar to its lows for the year lent support. Spot gold was down 0.39 percent at $1,243.91 an ounce, while U.S. gold futures for August delivery were 0.38 percent lower at $1,244.40 an ounce.