- US GDP Q/Q: 2.0% vs 2.2% exp
- Trump agrees to Putin meeting
- US500 hits lowest level of the month below 2700
US growth in first quarter was slower than previously thought according to the latest GDP figures with an annualised print of 2.0% lower than both the expected (2.2%) and the prior (2.2%). A fall in personal consumption was one of the chief causes for the drop, with growth seemingly slowing after the strong figures seen around the back end of last year. Another point worth making relating to the release was the the GDP price index rose more than the expected 1.9% to show 2.2% which possibly takes the edge off any USD weakness from the data.
A fall in personal consumption contributed to the slower pace of growth in the US with GDP dropping significantly since last year’s strong readings. Source: XTB Macrobond
Not long before the GDP release some other interesting news hit the markets with the announcement that US president Trump will meet with his Russian counterpart Putin in Helsinki, Finland on the 16th July. Russian interference in the 2016 election has been one of the most contentious topics of Trump’s term and a meeting with Putin has raised the number of calls that he is siding with the Kremlin while questioning US law enforcement and intelligence agencies.
Looking at the markets and there’s been more weakness seen in equities today with the US500 falling below the 2700 level to trade at its lowest level of the month in the last couple of hours. Source: xStation
The US500 is attempting to make a break lower today with yesterday’s rally fading out and the market ending the day near its lows. A rising channel going back for a few months is now being broken and if the local low at 2676 is broken also, then a move down to below 2600 looks possible. Bulls will want to push the market back above 2700 with a daily close above that level negating this attempted break lower.
The US500 is attempting to make a potentially significant break lower and could be set for a prolonged decline. Source: xStation
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