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Market Recap – OPEC+ in Vienna

Monday, July 1, 2019 11:03 AM GMT

G20 ended with US-China trade negotiations restarting and extra tariffs postponed. In addition, President Trump materialized his visit in the demilitarized zone at the border between the two Koreas and met Kim Jong Un.

Last December, the EU agreed on a 6-month grace period before Switzerland decides on compliance with EU rules (migration, social security, contribution to the EU’s budget, ruling of the European Court of Justice). No progress has been made, and today is the first day that the Swiss stocks are traded in unchartered territory, as the Swiss exchange is no longer enjoying the  “equivalence regime status”.

Following May’s EU elections, leaders should had agreed by now on the nominees of the top European jobs (European Commission presidency, European Parliament Presidency, European Council Presidency and Foreign Policy representative). Nevertheless, negotiations have not concluded as we are one day away from the first EU Parliament session following the elections and as we are heading to the 15~18 July session. Another top nomination that is pending, is the successor of Mario Draghi at the ECB.

Today the focus turns to the OPEC+ meeting in Vienna and how far the production cap will be extended so that oil prices are supported. Initially, Russia did not seem ready to agree on the production cap extension, but Vladimir Putin’s remarks during the G20 reveal that they are ready to agree.

Macro releases: Chinese industrial and services PMI releases were unchanged at 49.4 and 54.2 respectively. Today the macro releases that could move the markets are the European Manufacturing PMI, European M3, European unemployment, and the US Manufacturing PMI.

 

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