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On Friday, the Dow Jones (US30) Index rose by 0.62% (for the week +1.55%), while the S&P 500 (US500) Index gained 0.55% (for the week +0.76%). The Nasdaq Technology Index (US100) closed positive 0.63% on Friday (for the week +0.14%). Stock indices rose on Friday, with the S&P 500 and Dow Jones Industrials setting new record highs. A rebound in chip company stocks on Friday after Thursday's selloff helped boost the overall market. Stocks extended gains after the University of Michigan's US consumer sentiment index for July unexpectedly fell to an 8-month low, reinforcing speculation that the Federal Reserve may cut interest rates at its September FOMC meeting.

Bank earnings results on Friday were mostly bearish for stocks, with Wells Fargo (WFC) closing down more than 6% after reporting second-quarter net interest income below consensus. JPMorgan (JPM) also fell after reporting lower-than-expected second-quarter FICC sales and trading revenue. Citigroup (C) also came under pressure despite reporting better-than-expected second-quarter earnings.

This week, Fed Chairman Jerome Powell will be interviewed by David Rubenstein at the Economic Club of Washington. A question-and-answer session is scheduled after the interview. In a recent speech on Capitol Hill, Powell emphasized the central bank's ongoing efforts to fight inflation and its commitment to the dual mandate. Powell also expressed cautious optimism about inflation trends, noting some confidence that inflation will move down toward the 2% target.

Over the weekend, former US President Donald Trump was assassinated during a campaign rally in Butler, Pennsylvania. The assailant shot at Trump and hit him in the right ear before being neutralized by security forces. The assassination attempt on Trump has raised the chances of him winning the upcoming election, which has supported the dollar and put pressure on commodities.

Bitcoin rose above the $62,000 mark, hitting a near two-week high, as the failed assassination attempt on former President Donald Trump boosted his chances of retaking the White House in November in line with market forecasts. Trump has emerged as a cryptocurrency-backed candidate ahead of this year's US presidential election. On July 27, he is scheduled to attend a Bitcoin conference in Nashville, Tennessee.

Equity markets in Europe were mostly up on Friday. Germany's DAX (DE40) rose by 1.15% (for the week +1.48%), France's CAC 40 (FR40) closed up 1.27% (for the week +1.13%), Spain's IBEX 35 (ES35) added 0.72% (for the week +2.25%), and the UK's FTSE 100 (UK100) closed positive 0.36% (for the week +0.60%). European equity markets opened lower on Monday as investors assessed the fallout from the weekend assassination attempt on former US President Donald Trump. Traders feared that further violence could lead to political instability and market volatility.

The ECB will hold a monetary policy meeting this week. The ECB will not have one council representative as Spain has yet to appoint a new central bank governor to replace Pablo Hernandez de Cos, whose non-renewable term ended just over a month ago. At Thursday's conference, in addition to questions about borrowing cost dynamics, the ECB president may be asked about France, facing increased scrutiny in financial markets amid concerns about its fiscal outlook after snap elections left parliament in limbo.

Asian markets were predominantly up last week. Japan's Nikkei 225 (JP225) gained 0.80% for the week, China's FTSE China A50 (CHA50) added 1.37% for the week, Hong Kong's Hang Seng (HK50) gained 3.54% for the week, and Australia's ASX 200 (AU200) posted a positive 1.75%.

The offshore yuan depreciated to 7.27 per dollar as traders reacted to mixed economic data from China. Official data showed that China's economy grew at an annualized rate of 4.7% in the second quarter of 2024, down from 5.3% in the previous quarter and short of the projected 5.1% growth. This is the weakest growth since the first quarter of 2023, reflecting ongoing challenges, including a persistent real estate slump, weak domestic demand, a falling yuan, and trade friction with Western countries. In addition, retail sales fell to a 17-month low of 2% in June, indicating a significant slowdown in consumer spending. In contrast, industrial production rose 5.3% in June, beating market expectations despite the lowest growth in three months. On the monetary policy front, the People's Bank of China (PBoC) kept the medium-term lending rate at 2.5%, which was in line with market expectations.

The New Zealand dollar fell to around $0.608 amid weak domestic data. The latest data showed that the New Zealand Services Business Activity Index fell to 40.2 in June, declining for the fourth consecutive month and showing the lowest activity level in the sector since the survey was conducted in 2007.

• S&P 500 (US500) 5,615.35 +30.81 (+0.55%)
• Dow Jones (US30) 40,000.90 +247.15 (+0.62%)
• DAX (DE40) 18,748.18 +213.62 (+1.15%)
• FTSE 100 (UK100) 8,252.91 +29.57 (+0.36%)
• USD Index 104.26 +0.17 (+0.16%)
   

Important events today:

• Chinese GDP (q/q) at 05:00 (GMT+3);
• Chinese Industrial Production (m/m) at 05:00 (GMT+3);
• Chinese Unemployment Rate (m/m) at 05:00 (GMT+3);
• Chinese Retail Sales (m/m) at 05:00 (GMT+3);
• Switzerland Producer Price Index (m/m) at 09:30 (GMT+3);
• Eurozone Industrial Production (m/m) at 12:00 (GMT+3);
• Eurozone Empire State Manufacturing Index (m/m) at 15:30 (GMT+3);
• Canada BoC Business Outlook Survey at 17:30 (GMT+3).
• US Fed Chair Powell Speaks at 19:00 (GMT+3);
• US FOMC Daly Speaks at 23:35 (GMT+3).

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