Boris Johnson wins Tory leadership becoming the new UK PM
US Data disappoint estimates
IMF downgrades Global Outlook but revises the US higher
USD strength is the main highlight of this second trading day of the week, with the DXY index touching new highs for the month. Global Equities gained today as greater expectations of dovish policy from the ECB and positive earnings in the US boost sentiment. On the data calendar, today we had the release of a worse than expected Existing Homes Sales for June (-1.7% vs -0.2% exp) and Richmond Manufacturing Index (-12 vs 5 expected). Turing to politics, today we had the announcement of the new Tory Party leader and PM in the UK, with the largely anticipated victory of Boris Johnson.
Global Equities extend gains ahead of the Thursday ECB meeting and amid better than expected earnings out of the US. SP500 settled just below 3000 after a brief breach ahead of cash open. European Indices outperformed, ahead of Thursday ECB meeting for which traders expect further details on the implementation of new policy tools that could revamp inflation in the EU area.
EUR retouched the 1.1200 level to the downside due to a firmer US Dollar. GBP trader choppy closing the EU session below 1.2500 as traders cover their shorts after the expected appointment of Boris Johnson as new Prime Minister.
Gold traded sideways amid strong US Dollar and lacklustre US Equities. Crude traded flat around the 56 level as trader reassess after previous week heavy losses.
US 10Y Yield remained firm above 2%.
________________ EU Close
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