Early Morning Call: FTSE 100 suffers another week of losses; GBP/USD weakens
Indices in the Asia-Pacific region fell heavily overnight.
Indices overview
Indices in the Asia-Pacific region fell heavily overnight. In Japan, the Nikkei erased most of the gains recorded the previous week. Price pressure is broadening in the world’s third-largest economy. If Japanese headline consumer price index (CPI) fell to 3.2% year-over-year (YoY), the Bank of Japan's (BOJ) key gauge, the so-called "core-core" index that excludes both fresh food and fuel, accelerated to 4.3% in May; that's a rate not seen since June 1981.
At its next meeting in July, the Bank of Japan is now widely expected to revise up its inflation forecasts. In its last projections made in April, the BOJ expected core consumer inflation to hit 1.8% in the current fiscal year ending in March 2024.
UK inflation
Despite stubbornly high inflation, UK consumer morale keeps improving. The latest GfK consumer confidence survey rose to -24 in June, its highest level since January 2022. This survey doesn’t take into account the Bank of England's (BOE) 50-basis point rate increase announced on Thursday.
And retail sales in the UK declined by 2.1% in May, not as much as expected, as it follows a 3% fall in April.
German economy
Could we see Germany's recession deepen? On Thursday, the country’s bond yield curve inversion widened to the most in three decades. Throughout next week, several macroeconomic indicators will tell us more about the state of the German economy, starting on Monday with the Information and Forschung (Ifo) business climate, expected to marginally fall in June to 91.5.
On Wednesday, Gfk consumer confidence is forecast to rise to -23 in July from -24.2 in June.
The consumer price index will be released on Thursday, followed on Friday by retail sales.
Commodities overview
Crude oil inventories fell by 3.8 million barrels last week, according to the Environmental Impact Assessment (EIA), helped by solid export demand and low imports. US crude oil exports climbed to 4.5 million barrels per day last week, while imports fell about 50%. US gasoline stocks rose by 500,000 barrels, while distillates rose by 400,000 barrels.
The draw in crude oil failed to lift oil prices, which fell steadily throughout Thursday, taking WTI back below $70.
The number of oil and gas rigs in operation fell again last week, according to Baker Hughes. The total rig count fell by eight to 687. The number of oil-producing rigs alone fell by four to 552.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Seize your opportunity
Deal on the world’s stock indices today.
- Trade on rising or falling markets
- Get one-point spreads on the FTSE 100
- Unrivalled 24-hour pricing
See opportunity on an index?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Try a risk-free trade
- See whether your hunch pays off
See opportunity on an index?
Don’t miss your chance – upgrade to a live account to take advantage.
- Get spreads from one point on the FTSE 100
- Trade more 24-hour indices than any other provider
- Analyse and deal seamlessly on smart, fast charts
See opportunity on an index?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets
- Equities
- Indices
- Forex
- Commodities
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
