Wee morning newsletter

Ecoditure markets remain on an upward trend ahead of the Fed meeting. This Monday, June 14, 2021, the Eurostoxx 50 shows 4,126.70 points up 0.75% while the CAC 40 expects 6,600.66 points with 0.83% increase. The DAX 30 also posted an increase of  0.78% to 15,693.27 points, the FTSE 100 to 7,134.06 points (+0.65%), the SMI to 11,841.30 points (+0.26%), the AEX   to 728.48 points (+0.42%), the BEL 20 to 4,190.07 points (+0.52%), the IBEX 35 to       9,205.00 points (+0.78%), the DJIA at 34,479.60 points (+0.04%), the Nasdaq  at 14,069.42 points (+0.35%), the S&P 500 at 4,247.44 points (+0.19%) and the Nikkei 225 at 29,121.72 points (+0.60%).

On the exchange rate side, the change from the close in New York indicates a decline of -0.09% for THE EUR/USD which stands at 1.2100, the EUR/JPY shows 132.79 with a decline of 0.02% and the USD/JPY expects on 109.76 with an increase of 0.07%.

 The Banque de France published its latest business survey on Monday, accompanied by its forecasts for the French economy. Meanwhile, Safran and General Electric, the French group's joint venture partner in aircraft engines, are holding a press conference on Monday on their vision for sustainable aviation.

European equity markets are expected to continue to rise on Monday, allowing the Stoxx Europe 600 Index to set new records. At the beginning of the week, investors are focused on the next monetary policy meeting of the Federal Reserve (Fed), scheduled for Tuesday and Wednesday. At 7:40 a.m., the CAC 40 futures contract gained 16 points, or 0.2%, according to data from broker IG Markets. The contract on the DAX 30 took 20 points, or 0.1%, and the ftse 100 contract gained 16 points, or 0.2%.

G7 leaders over the weekend called on China to respect human rights without categorically condemning Beijing, and US President Joe Biden sought to create momentum for an international coalition to counter Chinese influence in the world. The 25-page joint communiqué issued Sunday by G7 leaders, which addresses issues ranging from the fight against the pandemic to the global economy, taxation, trade and girls' education, calls on China to respect human rights and fundamental freedoms. particularly in Xinjiang and Hong Kong. The same section of the communiqué says the G7 will continue its consultations on how to challenge China's behavior in the global economy. After the G7, Joe Biden continues his European tour on Monday with a North Atlantic Treaty Organization (NATO) summit in Brussels. Investors will also follow the April industrial production figures in the euro area.

In Asia, trade is relatively unanimated on Monday, with markets closed in China and Hong Kong. In Tokyo, the Nikkei index gained 0.6% at the end of the session.

S. Treasury bond yields rose Monday morning, as investor attention remained focused on U.S. inflation. At 7:40 a.m., the yield on the ten-year Treasury bill, the market's benchmark, stood at 1.463%, compared with 1.453% on Friday night. Bank of America is concerned that the recent acceleration in inflation, considered temporary, could last long enough to have long-term effects.  

On the foreign exchange market, the dollar gained ground on Monday against other major currencies, including the euro, but in trading volumes limited by the closure of financial markets in China and Hong Kong. According to DailyFX.com, investors are expected to focus this week on U.S. retail sales and the Fed's Monetary Policy Committee (FOMC) meeting.

Michael Feroli, economist at JPMorgan, says in a note to clients that the Fed may raise rates earlier than expected, due to reduced risks related to the Covid-19 pandemic and rising inflation expectations. Michael Feroli also anticipates "summary" discussions this week on a gradual reduction in asset purchases.

Oil futures continue to rise on Monday morning, after gaining ground for the third week in a row last week and reaching their highest level in two years. The market "cannot ignore the clearly bullish signal" of the International Energy Agency report, which on Friday called on the Organization of the Petroleum Exporting Countries (OPEC) and its allies to increase production in order to "meet the recovery in oil demand in 2022", says Louise Dickson, oil market analyst at Rystad Energy. At 7:30 a.m., the August contract for North Sea Brent was up 37 cents, at $73.06 a barrel, and the July contract for light sweet crude (WTI) listed on the Nymex was up 33 cents, at $71.24 a barrel.