How’dy USA

The US and Chinese leaders have agreed to re-start trade talks and the US has agreed to halt additional tariffs for now.

In US data, personal income rose by 0.5% in May (forecast: +0.3%). Personal spending rose 0.4% as expected. The core personal consumption deflator (inflation measure) rose 0.2% as expected in May to be up 1.6% over the year as expected. The Chicago PMI fell from 54.2 to 49.7 in June (forecast 53.1). Consumer sentiment eased from 100.0 to 98.2 in June (forecast 98.0).

US share markets were firmer in heavy trade ahead of the G20 meeting. On Friday, the Dow Jones index rose by 73 points or 0.3%, finishing with the best June gain since 1938. The S&P500 index rose by almost 17 points or 0.6% - and posted the best June gain since 1955. And the Nasdaq rose by 38.5 points or 0.5%. Over the week the Dow fell 0.4%, while the S&P 500 and Nasdaq both lost 0.3%.

US treasuries were flat ahead of the G20 meeting in Japan. US 2-year yields were unchanged near 1.76% and US 10-year yields were flat near 2.00%. Over the week US 2-year yields fell by 4 points and US 10-year yields fell by 6.5 points.

Bonjour Europe

Major currencies were mixed against the US dollar in US and European trade compared with the end of Asian trade. The Euro fell from near US$1.1390 to US$1.1350 and was near US$1.1359 in late US trade. The Aussie dollar rose from US70.00 cents to US70.32 cents and was near US 70.25 cents in late US trade. The Japanese yen eased from 107.64 yen per US dollar to JPY108.28 to be near JPY108.17 in late US trade.

European share markets were firmer on Friday. The panEuropean STOXX600 index rose 0.7%. The German Dax rose by 1.0% and the UK FTSE gained 0.3%. In London trade, shares of Rio Tinto rose 1.1% and BHP shares were up 0.2%.

Global oil prices were mixed on Friday. The Brent crude price was unchanged at US$66.55 a barrel. But the US Nymex fell by US96 cents or 1.6% to US$58.47 a barrel. Over the week Brent rose 2.1% and Nymex rose by 1.8%. On the weekend, Russian President Vladimir Putin agreed with Saudi Crown Prince Mohammed Bin Salman to extend the current OPEC+ oil production cuts for another 6-9 months at the G20 Summit.

Base metal prices were mixed on the London Metal Exchange (LME) on Friday. Lead, nickel and tin fell by up to 0.7% while other metals rose up to 0.5%. Over the week metals rose 0.4-5.0% with copper up the least and nickel up the most.

The gold futures price rose by US$1.70 an ounce or 0.1% to US$1,413.70 an ounce. But the spot gold price was trading near US$1,409 an ounce in late US trade. Over the week gold rose by US$13.60 an ounce or 1% and gold rose 7.7% over June. Iron ore rose by US$1.60 or 1.4% to US$117.95 a tonne. Over the week iron ore rose by US$1.55 or 1.3%.

G’day Australia

In Australia, the manufacturing PMIs are released with home prices. In the US, the ISM manufacturing index is due.