EUR 8.40 For Business Accounts Only

The Morning Track dual-citizenship

- The Morning Track – Dual Citizenship by Bob Savage
http://trackresearch.com/articles/the-morning-track-dual-citizenship/

Summertime begets travel and that means scratchy radio music in the car – where in some parts of the country there are 2 times of music – Country and Western – even though it’s hard to tell them apart. Diversity doesn’t always seem so simple. The same is true in markets today as there seems to be a dual citizenship problem for Europe and the UK cynically started by someone that claims Scotch and German ancestry. Trump visit to UK proved to be the event that shifted the risk sentiment overnight, with two statements moving markets – first that a US-UK trade deal may prove impossible with UK May’s Brexit plan along with his endorsement of Boris Johnson as a potential “great PM;” –and second another swipe at EU immigration policy. GBP and Gilts reflect this and that bleeds into EU bonds. China trade and M2 data also don’t help as its clear that the PBOC remains tight and that the shadow bank system is being further controlled hitting leverage just as trad
e reflects significantly less domestic demand. As for the rest of the day, the bid to the USD means trouble for risk even as equities hold big gains from Asia and Europe follows more modestly. The safe-haven signals of JPY and CHF seem at odds with Dr. Copper and other metals. Earnings in the US will be a key focus along with the Fed reaction functions after a week where risk-on holds despite trade fears. The biggest stories seem less important when its Friday and summer beckons. Watching 95.53 for more fireworks – though they may be more about France and the World Cup than the US and its independence.