Daily digest market movers: All eyes on Lagarde
- The Challenger Job Cuts report for May, to be released at 11:30 GMT, kicks-off the data releases. The previous number was 64,789 layoffs
- At 12:15 GMT, the European Central Bank will release its official rate decision and joint statement. Expectations are near 100% for a 25-basis-point rate cut from 4% to 3.75% for the Deposit Facility rate.
- At 12:30 GMT, while markets are still digesting the ECB rate decision, nearly all US data points for this Thursday will be released:
- Initial Jobless Claims are expected to tick up to 220,000 from 219,000. Continuing Claims should ease a little to 1,790,000 from 1,791,000.
- Goods Trade Balance posted a deficit of $99.4 billion in March. Goods and Services Trade deficit should widen to $76.1 billion in April from $69.4 billion in March.
- Nonfarm Productivity in the first quarter should grow by 0.1%, slower than the 0.3% seen in the previous quarter. Growth in Unit Labor Costs is set to accelerate to 4.9% from 4.7%.
- At 12:45 GMT, ECB President Christine Lagarde will comment on the rate decision. Fresh projections on growth and inflation will be released as well.
- Equities trade in a positive tone, having taken over the risk-on vibe from the US at the closing bell on Wednesday.
- According to the CME Fedwatch Tool, Fed Fund futures pricing data suggests a 31.4% chance for keeping rates unchanged in September, against a 56.8% chance for a 25 basis points (bps) rate cut and a 11.3% chance for an even 50 bps rate cut. An interest rate hike is no longer considered an option. For the upcoming meeting on June 12, futures are fully pricing that rates will remain at current levels.
- The benchmark 10-year US Treasury Note trades around 4.3%, near the fresh monthly low from Wednesday at 4.27%.
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