EU Market Update: Euro Zone Jun Flash CPI again matches 4-year low at 0.5%



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Article content EU Market Update: Euro Zone Jun Flash CPI again matches 4-year low at 0.5%

30.06.2014 11:25 Monday
- Month- and quarter-end considerations made for quiet trade
- German May retail sales came in much weaker than expected (MoM -0.6% +0.8%e)
- Euro Zone Private lending registers its 25th month of decline ( -2.0% v -1.8% prior)
- Euro Zone Jun Flash CPI matches 4-year low (0.5% v 0.5%e)

***Key Economic Data in session***
- (JP) Japan May Annualized Housing Starts: 872K v 909Ke; Housing Starts Y/Y: -15.0% v -10.5%e
- (DE) Germany May Retail Sales M/M: --0.6% v +0.8%e; Y/Y: 1.9% v 1.0%e
- (DK) Denmark Q1 Final GDP Q/Q: 0.8% v 0.9%e; Y/Y: 1.3% v 1.4%e
- (TR) Turkey May Trade Balance: -$7.1B v -$7.0Be
- (EU) Euro Zone May M3 Money Supply Y/Y: 0.8%e v 0.8% prior; M3 3-month average: 0.8%e v 1.0% prior
- (NO) Norway May Retail Sales W/Auto Fuel M/M: -0.9% v -0.3%e
- (UK) May Net Consumer Credit: £0.7B v £0.7Be; Net Lending: £2.0B v £1.6Be
- (UK) May Mortgage Approvals: 61.7K v 61.8Ke
- (UK) May M4 Money Supply M/M: -0.1% v -0.1%e; Y/Y: -0.9% v -0.3%e; M4 Ex IOFCs 3M Annualized: 2.7% v 3.1%e
- (EU) Euro Zone Jun Advance CPI Estimate Y/Y: 0.5% v 0.5%e; CPI Core Y/Y: 0.7% v 0.7%e
- (IT) Italy Jun Preliminary CPI NIC incl. tobacco M/M: 0.1% v 0.1%e; Y/Y: 0.3% v 0.3%e prior

Fixed Income:
- None seen

Indices [Stoxx50 +0.3%, FTSE 100 +0.1% at 6,765, DAX +0.4% at 9,851, CAC-40 flat at 4,438, IBEX-35 -0.3% at 10,927, FTSE MIB -0.1% at 21,297, SMI +0.1% at 8,570, S&P 500 Futures flat at 1,951]

- Market Focal Points/Key Themes: Equity markets open higher tracking gains in US stocks despite widening in Portuguese debt spreads and lower core bond yields, Philips rises on plan to spin off lighting business, Vestas Wind awarded large US orders

By Sector
- Health Care [Shire SHP.UK +1% (ongoing M&A speculation); Lundbeck LUN.DK -6% (data presentation) Genmab GEN.DK -3% (data presentation), Fresenius Medical FME.DE -1.5% (broker commentary)]
- Financials [Banco Espirito Santo BES.PT -2% (probe in Luxembourg)]
- Industrials [Siemens SIE.DE +1% (broker commentary)]
- Energy [Vestas Wind VWS.DK +5% (orders in the US), Lamprell LAM.UK +5% (upbeat outlook)]
- Consumer Discretionary [Mecom MEC.UK +32% (takeover offer)]
- Technology [Philips PHIA.NL +3% (spin off of lighting unit)]
- Stoxx50 sectors [Basic Materials +0.7%, Consumer Non-Cyclical +0.3%, Consumer Cyclical +0.2%, Technology +0.2%, Industrials +0.1%, Energy +0.1%, Financials flat, Telecom flat; Utilities -0.2%]


Currencies/Fixed Income:
- EUR/USD three-week high market participants were waiting on the release of Eurozone inflation data which should confirm of not seeing signs of any deflationary spiral so far. Although ECB night not have reached lower bound on interest rates it seemed to have time to assess impact of June policy changes. The data came in to match its 4-year low reading of 0.5% but core ticked up a tenth of a percent to 0.8%
- USD/JPY seven-week low and remain above the critical chart point of 100.70 area.

Political/In the Papers:
- (UK) BOE Gov Carney: Recent strength in GBP reflects the strength of the economy; To settle over time - UK press
-(UK) BOE's retiring dep gov Bean: Might be reasonable to think that in the long term you would go back to 5% but it's probably quite a long way down the road - UK press
- (UK) BOE's Dale: It is not our job to control house prices, nor can we control house prices - UK press
-(UK) BoE Deputy Gov Cunliffe: MPS members differed on how to cool the UK housing market - UK press
- (CN) PBoC and Bank of France sign memorandum of understanding to set up a yuan payment system in Paris

**Looking Ahead***
All times listed for economic events are denominated in Eastern Standard Time (Add 4 hours for GMT equivalent)
- (RU) Russia Q1 Final Current Account: No est v $27.6B prelim
- (PT) Bank of Portugal Report on Payment Systems
- 06:00 (PT) Portugal May Industrial Production M/M: No est v 5.4% prior; Y/Y: No est v 4.1% prior
- 06:00 (PT) Portugal May Retail Sales M/M: No est v -1.0% prior; Y/Y: No est v -0.2% prior
- 06:00 (MY) Malaysia May M3 Money Supply Y/Y: No est v 6.0% prior
- 06:00 (IL) Israel to sell 2016, 2019, 2023 and 2024 bonds
- 06:30 (IN) India May Fiscal Deficit INR Crore: No est v 1.1T prior
- 06:45 (US) Daily Libor Fixing
- 07:30 (BR) Brazil Central Bank Weekly Economists Survey
- 08:00 (PL) Poland Central Bank (NBP) Jun Inflation Expectations: 0.3%e v 0.5% prior
- 08:00 (PL) Poland Q1 Current Account Balance: -€771Me v -€1.1B prior
- 08:00 (ZA) South Africa May Trade Balance (ZAR): -12.0Be v -13.0B prior
- 08:00 (ZA) South Africa May Budget Balance (ZAR): No est v -40.1B prior
- 08:15 (US) Baltic Dry Bulk Index
- 08:30 (CA) Canada Apr GDP M/M: 0.2%e v 0.1% prior; Y/Y: No est v 2.1% prior
- 08:30 (BR) Brazil Nominal Budget Balance (BRL): No est v -4.6B prior; Primary Budget Balance: No est v 16.9B prior; Net Debt to GDP Ratio: No est v 34.2% prior
- 08:50 (FR) France Debt Agency (AFT) to sell combined €6.0-7.2B in 3-month, 6-month and 12-month Bills
- 09:00 (US) Jun ISM Milwaukee: No est v 63.49 prior
- 09:00 (CL) Chile May Manufacturing Index Y/Y: +0.9%e v -4.2% prior
- 09:00 (CL) Chile May Unemployment Rate: 6.4%e v 6.1% prior
- 09:00 (CL) Chile May Total Copper Production: No est v 471.3K prior
- 09:00 (CL) Chile May Retail Sales Y/Y: 1.1%e v 1.6% prior
- 09:30 (EU) ECB calls for bids in 7-Day Main Refinancing Tender
- 09:45 (US) Jun Chicago Purchasing Manager: 63.0e v 65.5 prior
- 10:00 (MX) Mexico May Net Outstanding Loans (MXN): No est v 2.521T prior
- 10:00 (US) May Pending Home Sales M/M: 1.3%e v 0.4% prior; Y/Y: No est v -9.4% prior
- 10:30 (US) Jun Dallas Fed Manufacturing Activity: No est v 8 prior
-11:00 (DE) German Fin Min Schaeuble with Spain Fin Min De Guindos in Madris
- 11:00 (US) Fed purchase $0.85-1.10B in Notes
- 11:30 (US) Treasury to sell 3-Month and 6-Month Bills
- 11:45 (EU)EU President Van Rompuy with investor George Soros participates in debate on Europe in Brussels
- 12:00 (US) Acreage Planted report
- 13:10 (US) Fed's Williams to speak in Sun Valley, ID
- 15:00 (AR) Argentina May Construction Activity M/M: No est v 2.2% prior; Y/Y: No est v -2.6% prior
- 15:00 (AR) Argentina Apr Economic Activity Index M/M: No est v -0.9% prior; Y/Y: No est v -0.9% prior
- 15:30 (MX) Mexico May YTD Budget Balance (MXN): No est v -49.4B prior
-16:00 (US) Crop Condition Report
- 19:50 (JP) Japan Q2 Tankan Large Manufacturers Index: 15e v 17 prior; Non-Manufactirers: 19e v 24 prior
- 21:00 (CN) China Jun Manufacturing PMI: 51.0e v 50.8 prior
- 21:45 (CN) China Jun Final HSBC China Manufacturing PMI: 50.8e v 50.8 prelim
- (US) Banks begin Volcker Rule Reporting