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The U.K. election campaign enters its final stretch, Draghi talks down the euro, and Trump backs Kushner. Here are some of the things people in markets are talking about today.
Alarming duds of May
A series of missteps by U.K. Prime Minister Theresa May and her advisers have seen the Conservative Party's lead over the opposition Labour Party fall to single digits from a margin bigger than 20 points, in April, when the election was called. Investors are starting to take seriously the risk that the vote may not produce the ``strong and stable government'' promised, with the pound the main victim of these jitters the moment. Brexit, meanwhile, has survived another challenge, as a opponents have ended their attempt to use the Irish courts to secure a last-minute reprieve.
European Central Bank President Mario Draghi said that the euro area still needs expansive monetary support in a statement to Brussels lawmakers yesterday. His comments weighed on the euro, with the common currency not helped this morning by the prospect of earlier-than-expected Italian elections. At 10 a.m. Eastern Time, CPI for Germany is released. That number will be watched closely as an indicator for where Eurostat's flash inflation estimate for May, to be released tomorrow morning, might come in.
Back in the U.S.A.
President Donald Trump stuck to a traditional script in his first public appearance since returning from his trip to Europe and the Middle East at a Memorial Day event in Arlington, Virginia. The president faces problems in Washington after his nine-day foreign visit, as allegations over his son-in-law Jared Kushner's contacts with Russians is causing concerns among lawmakers. Trump said he has "total confidence" in his daughter's husband.
Overnight, the MSCI Asia Pacific Index rose 0.1 percent while Japan's Topix index added 0.2 percent with the yen strengthening for a third day. In Europe, the Stoxx 600 Index slipped 0.1 percent by 5:28 a.m. with lenders among the biggest decliners. S&P 500 futures were also slightly lower.
At 8:30 a.m. U.S. personal income and spending data for April is released, with both prints expected to improve to 0.4 percent. In an interview on Bloomberg TV in Tokyo earlier, Federal Reserve Bank of St. Louis President James Bullard warned that Washington needs to deliver on the policy expectations that have driven markets higher since the election, a view that may be echoed by Fed Governor Lael Brainard when she speaks in New York at 6:00 p.m.
What we've been reading
This is what's caught our eye over the last 24 hours.
- Odd Lots Podcast: Poker legend Phil Hellmuth has some advice that every trader should hear.
- History says the emerging-market carry trade could end in tears.
- The old world order is alive but unwell after four months of Trump.
- Lucky country is getting left behind with Aussie markets lagging.
- Manuel Noriega, Panama dictator imprisoned by U.S., dies at 83.
- Short on funds but long on dreams, a British town starts a bank.
- Facebucks: A currency backed by attention.