From Marc Chandler at Bannockburn Global Forex:
Overview: China and Hong Kong re-opened after the Friday holiday and equities rallied strongly. Japan, Taiwan, and South Korea advanced as well. However, India and Australia equities fell. Europe’s Stoxx 600 is up around 0.9% to recoup its pre-weekend loss and more. US futures are broadly higher. Benchmark 10-year yields are mostly firmer. The US 10-year yield is up about three basis points to 2.96%. European core yields are firmer but the yields in the periphery are lagging amid speculation that the ECB will announce a new facility to support them if needed. The 10-year UK Gilt yield is up nearly five basis points to 2.20%, a new three-month high. The dollar is trading lower against all the major currencies. Sterling is the strongest with almost a 0.6% gain. The yen and Swiss franc are the weakest, rising about 0.1%. Emerging market currencies are also mostly higher today. The main exceptions are a few Asian currencies and the Turkish lira.
Turning to commodities, gold steadied after the pre-weekend reversal. It found support a little below $1850. July WTI reached almost $121 for easing back below $120. US natgas has jumped 4.3% today and Europe’s benchmark is up marginally. With China re-opening, iron ore prices extended their three-day rally into today with a 1% gain. It is trading at its best level in a month. Copper extended its reversal. At the end of last week, it reached 457.70 before reversing to close a little below 446.00. It fell to 440.60 today before stabilizing. July wheat has rallied 4.7% today after falling 10% last week.
Asia PacificChina's May services Caixin PMI rose to 41.4 from 36.2, disappointing expectations for a larger rise. The composite rose for the first time this year (from 37.2 to 42.2). With the lockdown lifted in Shanghai and restrictions easing in Beijing (public transportation resume today), and the investigation into Didi completed (mobile app may appear in store again later this week), the world's second-largest economy appears to have turned the corner.....
