Financial Markets Daily Report 06 June 2023
A subdued session across financial markets at the start of the week, as investors digested a move by some OPEC+ countries for new oil production cuts, disappointing economic sentiment data and a new round of hawkish messages from some key ECB officials, including a call for more policy rate hikes by Christine Lagarde.
- A subdued session across financial markets at the start of the week, as investors digested a move by some OPEC+ countries for new oil production cuts, disappointing economic sentiment data and a new round of hawkish messages from some key ECB officials, including a call for more policy rate hikes by Christine Lagarde.
- Saudi Arabia surprised by announcing a voluntary 1 million barrel-a-day cut in its oil output in July, a move that looks to stabilize oil prices and to compensate for the decision from other producing countries for keeping supply steady.
- On the data front, services PMIs for May were revised slightly lower across the eurozone (55.1 from 55.9 reported previously) while in the US the ISM reported a slowdown in services activity (from 51.9 to 50.3 in May).
- In this context, volatility increased and stocks ended with modest losses in both sides of the Atlantic. Sovereign bond yields rose further across Europe, as traders dialed up their expectations for policy rates. Oil prices also moved higher.