3 Overnight Headlines and 8 Items for the Day

Market strategists at Nomura, including Muhammad Kirdar, highlighted the following three headlines overnight and said investors should keep an eye on the following eight items for the day ahead:

Headlines

• UK: Retail sales fell 0.5% m-o-m in May following 1.0% m-o-m growth in April (Consensus: -0.5%).
• Japan: The all-industry activity index contracted 4.3% m-o-m in April after rising 1.5% in March (Consensus: -4.1%).
• Central banks: Norges Bank sends dovish signals in its projected repo rate path revisions while, in the Philippines, the BSP‟s SDA rate hike and CPI projection revisions send hawkish signals.

The Day Ahead

• US Treasury Secretary Lew and German Finance Minister Schäuble hold joint press briefing following meeting in Berlin.
• ECB Constâncio gives a lecture at the Bank of Greece symposium on 'Banking Union, Monetary Policy and Economic Growth' in Athens.
• ESM Board of Governors holds its annual meeting in Luxembourg.
• Eurogroup meeting in Luxembourg.
• US Senate: The Senate Foreign Relations and Armed Services committees will hold closed hearings on the security situation in Iraq (14:00 and 14:30 EDT, respectively).
• US initial jobless claims: Initial jobless claims continue to linger below 320k. This suggests that layoffs have bottomed out and that more hiring will be needed to spur job growth. Consensus expects 313k claims.
• Philly Fed survey: The Philly Fed business survey‟s headline index has been strong thus far in Q2. In addition, a key indicator of future activity within the survey, the new orders sub-index, remained in double digits in May and provides support for manufacturing activity this month. Thus, we expect the index to remain elevated at 13.0 in June (Consensus: 14.0).
• US leading indicators: An increase in the S&P500 index, a lower interest rate spread (10yr Treasury bonds less federal funds), lower initial claims and an increase in the ISM new orders index should support the index of leading indicators in May. Consensus expects a 0.6% increase in the leading index

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