US stocks were mixed and yields gained as participants digested US data and busy global central bank activity - Newsquawk Asia-Pac Market Open

US stocks finished mixed as participants digested the slew of global central bank updates and various data releases stateside including Initial Jobless Claims which remained elevated. Nonetheless, the S&P 500 and Nasdaq 100 snapped their recent losing streaks with outperformance in the latter as the tech sector atoned for the prior day's losses, while the majority of sectors were in the red with small caps pressured amid economic headwinds and the higher yield environment.
USD was firmer amid gains in US yields despite mixed data releases including larger-than-expected Initial Jobless Claims, while the latest Fed rhetoric continued to signal further action as Fed Chair Powell noted the FOMC broadly feels it will be appropriate to hike rates again this year and perhaps two more times.
Looking ahead, highlights include Australian Flash PMIs, UK GfK Consumer Confidence, Japanese CPI & Flash PMIs, Singapore CPI, Holiday Closures in Mainland China & Taiwan.

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LOOKING AHEAD

Highlights include Australian Flash PMIs, UK GfK Consumer Confidence, Japanese CPI & Flash PMIs, Singapore CPI, Holiday Closures in Mainland China & Taiwan.

US TRADE

US stocks finished mixed as participants digested the slew of global central bank updates and various data releases stateside including Initial Jobless Claims which remained elevated. Nonetheless, the S&P 500 and Nasdaq 100 snapped their recent losing streaks with outperformance in the latter as the tech sector atoned for the prior day's losses, while the majority of sectors were in the red with small caps pressured amid economic headwinds and the higher yield environment.
SPX +0.37% at 4,381, NDX +1.18% at 15,042, DJIA -0.01% at 33,946, RUT -0.80% at 1,848.
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NOTABLE HEADLINES

Fed Chair Powell said the FOMC broadly feels it will be appropriate to raise rates again this year and perhaps two more times, while they kept rates on hold to give themselves more time to make decisions and a strong majority of the committee feels there is a little further to go with rate hikes. Furthermore, Powell said they are close to the destination on rates and it makes sense to move at a careful pace, while he added they do not want to overdo it and that they expect inflation to move down this year with the labour market to continue to gradually cool.
Fed's Bowman (voter) said additional policy rate increases will be needed to reach a sufficiently restrictive level and control inflation, while she added that inflation is still unacceptably high despite the drop in the headline and monetary policy has had some effects on the economy, but core inflation has essentially plateaued since the fall of last year.
Fed's Barkin (non-voter) said US inflation is too high despite falling from the peak, while he added that demand is still elevated vs pre-COVID trend which is boosting CPI and he is comfortable with more hikes if inflation is not heading to the goal.

DATA RECAP

US Kansas City Fed Manufacturing Index -12 vs Exp. -5 (Prev. -1)
US Leading Index Change MM (May) -0.7% vs. Exp. -0.7% (Prev. -0.6%)
US Existing Home Sales (May) 4.3M vs. Exp. 4.25M (Prev. 4.28M)
US Initial Jobless Claims 264.0k vs. Exp. 260.0k (Prev. 262.0k, Rev. 264k)
US Continued Jobless Claims 1.759M vs. Exp. 1.782M (Prev. 1.775M, Rev. 1.772M)

FIXED INCOME

US Treasuries were ultimately lower in the aftermath of the larger-than-expected BoE rate hike with headwinds also from hawkish comments from Fed's Bowman and supply.

FX

USD was firmer amid gains in US yields despite mixed data releases including larger-than-expected Initial Jobless Claims, while the latest Fed rhetoric continued to signal further action as Fed Chair Powell noted the FOMC broadly feels it will be appropriate to hike rates again this year and perhaps two more times.
EUR* initially strengthened to lift EUR/USD briefly above 1.1000 before faltering as the dollar firmed.
GBP failed to sustain the knee-jerk reaction from the BoE's larger-than-expected 50bps rate hike with the currency constrained by concerns regarding the impact of tighter policy and rising mortgage rates.
JPY continued to underperform and USD/JPY rose above 143.00 amid widening yield differentials.
SNB raised its policy rate by 25bps to 1.75%, as expected. SNB said it cannot be ruled out that additional rises in the SNB policy rate will be necessary. SNB Chairman Jordan said underlying inflation pressure has risen further and there is a danger that inflation is becoming entrenched above 2%, while he added it is most likely that they will have to tighten monetary policy again but can also take a more gradual approach.
Norwegian Central Bank hiked its key policy rate to 3.75% vs. Exp. 3.50% (Prev. 3.25%), while it said the current assessment of the outlook and balance of risks implies the policy rate will most likely be raised further in August.
CBRT hiked rates to 15.00% from 8.50% (exp. 21.00%, analyst ranges between 12.50%-30.00%). CBRT stated that monetary tightening will be further strengthened as much as needed in a timely and gradual manner until a significant improvement in the inflation outlook is achieved. Furthermore, the Committee decided to begin the monetary tightening process in order to establish the disinflation course as soon as possible and anchor inflation expectations, as well as control the deterioration in pricing behaviour.
Mexican Central Bank kept its interest rate at 11.25%, as expected. Banxico said the Board will thoroughly monitor inflationary pressures as well as all factors that have an incidence on the foreseen path for inflation and its expectations, while it estimates that the inflationary outlook will be complicated and uncertain throughout the entire forecast horizon with upward risks. Furthermore, it considers it will be necessary to maintain the reference rate at its current level for an extended period to achieve an orderly and sustained convergence of headline inflation to the 3% target.

COMMODITIES

Crude were lower with oil prices weighed on by the broad dollar bid as opposed to anything oil specific amid the central bank bonanza including hawkish surprises from the Norges Bank and BoE.
US EIA Weekly Crude Stocks w/e -3.831M vs. Exp. 0.329M (Prev. 7.919M)
Russia reduced planned oil exports via Transneft by 0.5% in Q3 from Q2 levels to 4.24mln BPD, according to Reuters citing sources and its own calculations.

GEOPOLITICAL

Russia warned the US not to send NATO troops to Ukraine, according to RIA citing a Russian official.

ASIA-PAC

NOTABLE APAC HEADLINES

China lodged an official protest over US President Biden's dictator remark about Chinese President Xi, according to WSJ.
US President Biden said his comment on Chinese President Xi being a dictator did not undermine or complicate the relationship with China.
US President Biden said he had a very productive meeting with India's PM Modi and the two are doubling down to secure the semiconductor supply chain, while Indian firms are announcing over USD 2bln in US investments.
US House Speaker McCarthy and Democratic leader Jeffries will visit India in October on a congressional delegation, according to Punchbowl News.
RBI Minutes stated that the current level of the repo rate is high enough to keep inflation below the upper tolerance band on a sustained basis.

EU/UK