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Daily Briefing – Monday, August 21, 2017

Europe

Following the terror attack in Barcelona, some good news emanated from Germany – a 2.3% increase in Producer Prices for July YoY. And Britain – in a bid to expand the availability of its exports in the EU market – yesterday announced it may not rule out EU oversight of customs controls at post-Brexit British borders.

 

US

The USD was slightly up in Asian trading as the US, Canda and Mexico concluded their first round of NAFTA talks Sunday, saying that they would next meet in September in Mexico in an effort to “upgrade the agrrement” through “accelerated and comprehensive negotiations”. US consumer sentiment last week was near its 13-year high (98.5 in January) – jumping to 97.6 despite political acrimony – and the Philly manufacturing index beat expectations by falling to 18.9 – less than expected; industrial production was also down. . Canadian housing slowed for the 4th month in a row due to rising prices and mortgage rates, and consumer inflation rose 1.2% YoY.

 

Asia

Asian markets begin the week in the red, led by Australia’s 0.67% retreat despite strength in the energy sector. The Nikkei’s 0.34% drop is being ascribed to a peak in the Yen following the terrorist attacks in Barcelona as well as the commencement of US military manouvers in the Pacific, which are being threatened by North Korea. A Reuters poll this morning shows that Japanese manufacturers are at their most confident in a decade – 27 points in a 548-member poll. Chinese equities are up led by the Hang Seng at 0.44%.

 

Commodities

Friday’s Baker Hughes count of active US oil rigs was down 5 rigs to 763. traders pushed the price of a barrel of WTI up by neearly $2 on the result, and the coommodity is now once again struggling with the 48.80 support level. Production, however, continues to increase and is at a 2-year high. Gold also saw a break through the 1300 level Friday as it reacted to the Barcelona attack. It has since returned to the 1290 region, where it continues to wait.

 

Shares

Alibaba soared to record highs after the company posted a better-than-expected EPS of $1.17 for the year’s second quarter. Revenue is up 56% YoY at $7.4bn.

 

Today’s Events

8:30 AM GMT

UK: Public Sector Borrowing

10 AM GMT

Germany: Bundesbank’s “BUBA” Monthly report

12:30 PM GMT

US: Chicago Fed Activity Index

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