Daily Update 5 July, 2021

Global Markets Update

U.S. equity markets closed higher on Friday, with the Dow Jones up +0.4% and both S&P 500 and NASDAQ gaining +0.8%, after data which revealed the pace of U.S. hiring accelerated in June, with payrolls increasing by 850,000, the most in 10 months bolstered by strong job gains in leisure and hospitality, while the unemployment rate edged up +10bps to 5.9% because more people voluntarily left their jobs and the number of job seekers rose, bolstered views the central bank won’t rush to taper its stimulus program any time soon. The U.S. trade gap widened in May to the second-largest on record with the gap in trade of goods and services rising +3.1% MoM to $71.2 billion, as imports (climbing +1.3% to $277.3 billion) increased faster than exports (advancing +0.6% to $206 billion).

Long-dated U.S. treasury yields were lower, with the 2-Yr yield at 0.234% and the 10-Yr yield at 1.424%.

European markets. European equity markets closed mostly higher on Friday, with the Stoxx Europe 600 up +0.3%, led by gains in Travel & Leisure stocks after the U.K. government announced it is working with the EU on mutual recognition of vaccinations to allow easier travel. The U.K. FTSE 100 was flat and German DAX closed +0.3% higher.

Asian markets. Asian equity markets closed mixed on Friday, with the Shanghai Composite down -2.0% and Hang Seng down -1.8%, after the Chinese Communist Party marked its centenary with tough talk by Chinese President Xi Jinping. KOSPI was flat and Nikkei 225 gained +0.3%.

WTI oil was little changed and is trading at US$75.16 a barrel,
after OPEC and its allies abandoned oil-supply negotiations until Monday as a rebellion by a key member threatened the unity of the alliance, with the United Arab Emirates doubling down on demands for better terms. Iron ore price is at US$214.43 per ton. Spot gold is trading at US$1,787 per oz.

ASX performance. The ASX 200 closed +0.59% higher on Friday, led by gains in Energy (+1.76%) stocks.

IDP Education Ltd (IEL) surged +20.3%, after agreeing to buy the British Council’s Indian IELTS operations for GBP130m on a debt free, cash free basis.