EU Daily Market Wrap - 22nd May 2019

EU Daily Market Wrap - 22nd May 2019

Today's Highlights

  • Pro-Brexit Ministers meeting to plot a way forward

  • Mnuchin sends confusing signs on Trade talks

  • Bearish Oil DoE inventories data

  • China says some people in the US are trying to hinder China's development

Macro Review

Tricky day in the market today with a lot of conflicting signs on Trade negotiations between US and China but foremost with an escalation in Brexit tension as mounting pressure on Theresa May have led to UNCONFIRMED rumours suggesting her resignation. Risk-off has been the main sentiment for today with global share struggling but still showing signs of resilience. I am honestly surprised by the way equities have stubbornly refused to sell-off despite escalating trade war, especially after the recent more aggressive wording employed by China. 

US Equities closed the EU session in red as China stands ready "to face long-term challenged with US". However, the reaction was mixed after Mnuchin remarks that "Exceptions are possible on latest round of China Tariffs". Choppy session overall, also given by the FOMC minutes due tonight at 7.00 pm. European Equities followed similar patters, closing flat amid Brexit rumours and slight negative risk appetite.

FX space was choppy today amid lack of direction in the USD Dollar due to Brexit tensions, and trade confusion. GBP suffered another day of losses after report - later denied - suggesting PM May resignations by tonight. EUR was flat as the market awaits the FOMC minutes tonight. JPN hedged higher amid risk-off tone.

Crude paired back some of recent gains after another surprise build in oil inventories. Gold bounced off recent lows amid safe heaven flows.

EU Close

If you missed the morning briefing from the desk click HERE Hope you enjoyed the session.

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