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Weak Japanese Machine Order Data Weigh On Global Markets
International
Asia
● Asian stock indexes tumbled as weak Japanese machine order data, a lower-than-expected Chinese CPI (consumer price index) and PPI (producer price index), and a weak U.S. jobs report caused investors to worry about global growth.
● The Nikkei fell 1.37 percent; Korea’s KOSPI slid 1.19 percent; the Shanghai Composite slumped 2.37 percent; the Hang Seng dropped 1.88 percent; and the S&P/ASX 200 retreated 0.95 percent.
● Core machine orders in Japan in May fell 14.8 percent—much more than the 3.3 percent decrease forecasted in a Reuters poll. This data suggests that manufacturers as well as service sector companies reduced orders most likely due to the weakening global economy. Check for movement in the iShares MSCI Japan Index Fund (NYSEArca: EWJ)
Europe
● European stock indexes retreated today on the report showing Japanese machine orders reaching a 10-year low, and Spanish bonds slumped. Expect movements in the Vanguard MSCI Europe ETF (NYSEArca: VGK).
● German exports in May grew 3.9 percent—or more than the 0.2 percent forecasted by economists. However, correspondingly, imports grew 6.3 percent. Look for movements in the iShares MSCI Germany Index Fund (NYSEArca: EWG).
● Spanish and Italian bonds fell as the 10-year yields for both increased 0.10 percentage points to 7.02 percent and to 6.13 percent, respectively.
Domestic
● U.S. stock futures indicated a lower opening, largely because of the drop in Japanese machine orders.
Commodities
All commodities news is as of 7:05 a.m. ET.
Gold and Silver Rose
● Gold increased 0.04 percent, or $0.65, to $1584.40. Expect increases in the SPDR Gold Shares physical bullion ETF (NYSEArca: GLD).
● Silver jumped 0.44 percent, or $0.12, to $27.23. Expect the iShares Silver Trust (NYSEArca: SLV) to tick higher.
WTI and Brent Oil Up
● The August contract for WTI crude oil edged up 0.69 percent, or $0.58, to $85.03 per barrel.
● The August contract for Brent crude oil rose 0.73 percent, or $0.72, to $98.91 per barrel.
● Expect increases in both the United States Oil Fund (NYSEArca: USO) and in the United States Brent Oil Fund (NYSEArca: BNO).
Fund Flows
On Friday, July 6, 2012, the top ETF in nominal inflows was iShares Russell 1000 Value Index Fund (NYSEArca: IWD), with creations of $101.5 million. The top ETF in nominal outflows was the SPDR S&P 500 ETF (NYSEArca: SPY), with redemptions of $1.55 billion.
ETF Launches
None as of yet today.
ETF Filings
None as of yet today.
Economic Calendar
Domestic
● Consumer Credit - 3:00 p.m. ET
Americas
● Canada
○ BOC Business Outlook Survey - 10:30 a.m. ET
Europe
● Switzerland
○ Unemployment - 1:45 a.m. ET
● Germany
○ Merchandise Trade - 2:00 a.m. ET
Asia/Pacific
● China
○ Merchandise Trade Balance - TBD |
