 News from the UK catch most headline today as, finally, Prime Minister Theresa May announced to resign. Pound's reaction is generally softer but selloff is so far limited. Sterling has been under much selling pressure up to today's announcement and thus, the decision was well priced in. Now, the next trigger of a major move would be Conservative Party Leader election, which is set to complete by end of June. Dollar also remains generally weak for today on weakness in treasury yields, impact of trade war with China, as well as speculations of Fed rate cut. Trump might hinted at willingness to compromise national security to include the "very dangerous" Huawei in a trade deal with China. But the Chinese side sounds like they're "mentally" preparing for a prolonged trade war. No trade talk is scheduled for now. No decision of a Trump-Xi summit. And Premier Li Keqiang indicated openness to more tax cuts for stimulating the economy. In the currency markets, Dollar and Sterling are so far the weakest ones for today, followed by Swiss Franc. New Zealand Dollar lead commodity currencies higher. For the week, Pound is the weakest one followed by Dollar, and then Canadian. Swiss Franc is the strongest, followed by Aussie, despite talks of three RBA rate cuts. In other markets, DOW future is currently up more than 100 pts. 10-year yield is down -0.0027 at 2.32. In Europe, FTSE is up 0.98%. DAX is up 0.81%. CAC is up 0.88%. German 10-year yield is up 0.004 at -0.112, staying well below -0.1 handle. Earlier in Asia, Nikkei dropped -0.16%. Hong Kong HSI rose 0.32%. China Shanghai SSE rose 0.02%. Singapore Strait Times rose 0.29%. Japan 10-year JGB yield dropped -0.0092 to -0.069. |
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