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What to watch for today

The upcoming session will have a one key point worth looking at. The ADP report will be the most important hint ahead of the NFP report due Friday that could have an impact on financial markets. Aside of this print, it’s also worth looking at the report on oil inventories from DOE as well as on some central bankers speeches.

10:00 am BST - EU PPI - Producer Price Index has usually a much lower impact than the CPI, but it doesn’t mean that it’s not important. The ECB should be content of a rise in Core CPI in July and if producer prices confirm that inflationary pressure is building, a tapering in ECB’s QE could happen as soon as September. One should not expect a market’s reaction after today’s data, but it doesn’t mean that they’re not worth lookin at. The higher producer prices, the higher CPI.

1:15 pm BST - US ADP - The June data surprised on the downside, posting the weakest growth in 7 months, although the report did note the labour market remains solid. ADP usually serves as a hint ahead of the NFP, but the trend has changed recently. Weaker ADP was followed by a solid NFP print in June, so don’t be surprised if the initial reaction is reversed later. The market expects a rebound to 190k from 158k in June. A beat could help the suffering dollar.

3:30 pm BST - DOE report - U.S. crude-oil stocks are expected to show a decrease in data from the Department of Energy, according to a survey of analysts and traders by Bloomberg. The market sees a drowdown of around 3.5 mln barrels. Recent trend in the data is positive for oil, so it won’t be a big surprise to see the commodity rising after the print. 

 

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