Morning Update – 07/06/2017 – by Arjun Lakhanpal

Morning all.. Wall St nudged lower again overnight with the S&P down 0.28% and the dollar remained offered, weighed down by low US yields. In Asia we saw the Nikkei nudge higher closing up 0.04% so basically unchanged as we move into the busy part of the week. Asset markets on hold as we have the ECB, UK election and Comey testimony on Thursday. Comey Source: Former FBI Dir Comey will publicly describe conversations with Donald Trump but stop short of saying if he thinks Trump tried to block a Federal investigation into Russia’s role in 2016 election. US Treasury Sec: US trade imbalance with China is significant concern; market access to China is definitely an issue, wants reciprocal trade relationship; looking at 1 year plan, 100 day plan with China; no concerns on China’s economy in the near term; currency manipulation taken very seriously by Trump administration; China is an important part of the solution with the US in dealing with North Korea; China does face some difficulties transitioning their economy in the right direction.. AUD in a tight range considering the data last night. Aus Q1 real GDP beats: 0.3% q/q vs 0.2% cons; 1.7% y/y vs 1.5% cons -Aus May AIG Cons Index: 56.7 vs 51.9 prior.. GBP also holding up well so close to the election and the Ashcroft UK election model has UK conservatives to win a 64 seat majority (vs 60 projected on June 2nd) “combined probabilistic model” estimates Cons winning total of 357 seats. This helping support GBP. Oil a little lower after API Oil Inventories: Crude -4.6m; Cushing -1.6m; Gasoline +4.1m; Distillate +1.8m released last night.. Russian Energy min Novak: OPEC & non-OPEC deal should be continued despite the gulf row over Qatar; no plans to call an extraordinary meeting.. US 10yr yield currently 2.15% as Europe walks in.. Data this morning sees UK Halifax House price Index, Swedish Industrial Orders and Italian Retail sales.. Good Luck…