Starting on the 10th June at 5 per cent, and rising to a maximum 25 per cent by October, President Trump Tweeted: ‘’the United States will impose a Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP…until the Illegal Immigration problem is remedied…’’ Coinciding with the day Mexican President Lopez Obrador had started a formal process to ratify a trade deal with the US and Canada (USMCA), Reuters suggests it raises the risk of devastating economic relations with its biggest trading partner.
City AM reports this morning that banking giant HSBC is planning to cut at least 500 jobs in its investment banking division. The cuts to global banking and markets should start mid-June and continue through to year-end. Project Oak, as it’s been nicknamed, will allow the cost of redundancies to be carried by the parent company rather than individual divisions.
DAX 30
Looking increasingly as though April and May have been dominated by topping activity, a head and shoulders, with momentum turning bearish on the close below the trend line – and maybe below the neckline today. Note that 10-year German Bund yields are back down at record lows yielding minus 18 basis points.
SHORT TERM TRADER: Short at 11870; stop above 12200. Target 11325.
POSITION TAKER: Will sell on a close below 11800 tonight.
FTSE 100
Slow work as we keep one eye on the pound.
SHORT TERM TRADER: Will sell on a close below 7100.
POSITION TAKER: Short at 7275; stop above 7350. Target 6875.
S&P 500
Momentum is clearly bearish and investors are buying bonds.
SHORT TERM TRADER: Short at 2880; stop above 2850. Target 2720.
POSITION TAKER: Short at 2866; stop above 2900. Target 2740.
BRITISH POUND/US DOLLAR
Oversold and hanging on by the skin of its teeth with some suggesting that a break below 1.2600 would unleash a wave of options-related selling.
SHORT TERM TRADER: Small long at 1.2675; stop well below 1.2600. Target 1.2925.
POSITION TAKER: Square.
EURO/US DOLLAR
Just about holding at this year’s lows as the rift between Chancellor Merkel and her anointed successor at the CDU, Annegret Kramp-Karrenbauer, grows and the rumour mill kicks in.
SHORT TERM TRADER: Long at 1.1195; stop below 1.1100. Target 1.1400.
POSITION TAKER: Square.
GOLD
Not quite what we had expected as we attempt to break above trend line resistance.
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
