Morning Call For Monday, July 2

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Overnight Markets And News

Sep E-mini S&Ps (ESU18 -0.52%) this morning are down -0.53% and European stocks are down -0.57% as trade risks drag global equity markets lower. Sep COMEX copper (HGU18 -0.39%) is down -0.51% to a 9-1/4 month low, which undercut mining stocks and metals producers on concern trade tensions are beginning to slow global manufacturing activity. The Eurozone Jun Markit manufacturing PMI was revised downward to a 1-1/2 year low of 54.9 and the China Jun manufacturing PMI fell -0.4 to 51.5, weaker than expectations of -0.3 to 51.6. Asian stocks settled lower: Japan -2.21%, Hong Kong closed for holiday, China -2.51%, Taiwan -0.54%, Australia -0.27%, Singapore -0.91%, South Korea -2.25%, India -0.45%. China’s Shanghai Composite tumbled to a 2-1/3 year low and the Chinese yuan fell to a 9-month low of 6.632 per dollar as increased risks of a trade war with the U.S. and weaker-than-expected China Jun manufacturing data hammered Chinese stocks and the yuan. Japan’s Nikkei Stock Index fell to a 2-1/2 month low after Japan’s Q2 Tankan showed confidence among large manufacturers declined more than expected.

The dollar index (DXY00 +0.22%) is up +0.33%. EUR/USD (^EURUSD -0.41%) is down -0.39% weaker on heightened political risks in Germany as Chancellor Merkel’s Christian Democratic party may lose its parliamentary majority due to a standoff on migration policies. The Interior Minister of the Bavarian Christian Social Union has threatened to resign from Merkel’s cabinet if no compromise is found on migration policy today. USD/JPY (^USDJPY +0.09%) is down -0.01%.

Sep 10-year T-note prices (ZNU18 +0-045) are up +5 ticks.

The Eurozone Jun Markit manufacturing PMI was revised downward to 54.9 from the previously reported 55.0, the slowest pace of expansion in 1-1/2 years.

The Eurozone May unemployment rate was unchanged at an 8-1/3 year low of 8.4%, better than expectations of no change at 8.5%.

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