Overnight Markets And News

Jun E-mini S&Ps (ESM18 -0.32%) this morning are down -0.34% and European stocks are down -0.58% as Jun WTI crude oil (CLM18 -1.23%) falls -1.34% before President Trump’s decision on the Iran nuclear deal. President Trump said he will announce his decision at 1400 EST today on whether the U.S. will reimpose sanctions on Iran, which would curb crude exports from OPEC’s third-largest member. European stocks also fell, and EUR/USD is down -0.41% at a 4-1/4 month low on heightened Italian political risks after Italy’s ant-establishment Five Star Party and the League rejected the idea of a non-partisan prime minister and called for new elections in July. Asian stocks settled mostly higher: Japan +0.18%, Hong Kong +1.36%, China +0.79%, Taiwan +0.82%, Australia +0.12%, Singapore +0.29%, South Korea -0.28%, India +0.02%. China’s Shanghai Composite rose to a 3-week high after China Apr imports rose more than expected, a sign of stronger domestic consumption. Also, China said Liu He, President Jinping’s top economic adviser, will visit Washington next week for follow-up trade talks with U.S. Treasury Secretary Mnuchin.

The dollar index (DXY00 +0.39%) is up +0.33%% at a new 4-1/4 month high after Fed Chair Powell said the market “is reasonably aligned” with Fed rate hike expectations. EUR/USD (^EURUSD -0.47%) is down -0.41% at a 4-1/4 month low on Italian political risks. USD/JPY (^USDJPY -0.09%) is down -0.10%.

Jun 10-year T-note prices (ZNM18 -0-005) are little changed, down -0.5 of a tick.

Fed Chair Powell, speaking at a conference in Switzerland, said “Fed policy normalization has proceeded without disruption to financial markets, and market participants’ expectations for policy seen reasonably well aligned with policymakers’ expectations.”

German Mar industrial production rose +1.0% m/m, stronger than expectations of +0.8% m/m.

The German Mar trade balance was in surplus by +25.2 billion euros, wider than expectations of +22.5 billion euros and the largest surplus in 2-years. Mar exports rose +1.7% m/m, weaker than expectations of +1.8% m/m. Mar imports unexpectedly fell -0.9% m/m, weaker than expectations of +1.0% m/m.

The German Mar current account balance was in surplus by +29.1 billion euros, wider than expectations of +27.0 billion euros and the biggest surplus in a year.