Forex

US Futures Falling, Watch AMZN, GRUB, DAL, REGN

The S&P 500 Futures  are on the downside after the Federal Reserve hinted at keeping interest rates near zero through 2022. At the same time, the central bank said it expects the U.S. economy to contract by 6.5% this year and rebound 5.0% in 2021.

Later today Producer Price Index (+0.1% on month in May expected), Initial Jobless Claims (a fall to 1.550 million expected) and Continuing Claims (a fall to 20.000 million expected) will be published.

European indices are under pressure. In the U.K., the RICS index measuring house prices came out at -32% in May, against -24% expected and -22% the previous month (revised from -21%).

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Asian indices closed deeply in the red. This morning, government data showed that Japan’s first quarter BSI All Industry Business Condition Index for large firms sank to -47.6 (-38.4 expected) from -10.1 in the prior quarter. Official data showed that China’s M2 money supply rose 11.1% on year in May (+11.3% expected), while new yuan loans totaled 1,480 billion yuan (1,600 billion yuan expected).

WTI Crude Oil Futures are falling. U.S. Energy Information Administration’s weekly has reported that the country’s crude-oil stockpiles rose to a record level of 538.1 million barrels.

Gold is edging lower on profit taking following a bounce after the Fed decision. Gold fell 12.21 dollars (-0.7%) to 1726.49 dollars.

The US dollar gains ground on falling equities. EUR/USD fell 16pips to 1.1358. GBP/USD dropped 88pips to 1.2659 on Brexit concerns.

US Equity Snapshot

Amazon.com (AMZN): the European Union plans to issue formal antitrust charges against the e-commerce giant, according to Dow Jones Newswires.

Grubhub (GRUB) and Just Eat Takeaway.com have entered into a definitive agreement whereby Just Eat Takeaway.com is to acquire 100% of the shares of Grubhub in an all-stock transaction “to create a leading global online food delivery player”. The transaction represents an implied value of 75.15 dollars for each Grubhub share and implies a total equity consideration of 7.3 billion dollars.

Delta Airlines (DAL) forecasts second quarter sales to be down 90% with a systemwide capacity down 85%. The company expects to reduce its average daily cash outflow to approximately 40 million dollars by June 30, 2020, down from approximately 100 million dollars per day as of March 31, 2020.

Regeneron (REGN), the pharma company, announced “the initiation of clinical trials for its investigational anti-viral antibody cocktail for the treatment and prevention of COVID-19”.

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