SHANGHAI, May 25 (SMM) – This is a roundup of global macroeconomic news last weekend and what is expected in the day ahead.
With the emergence of a fresh source of tension between the US and China denting investor sentiment, the US dollar continued its rally against a basket of rivals on Friday while oil prices pulled back.
US stocks closed little changed on Friday as investors capped a strong week of gains amid optimism around a potential coronavirus vaccine and the US reopening its economy.
LME base metals, except for zinc, closed lower on Friday, with copper shedding 1.6% to lead the way down. Aluminium dropped 1.2%, nickel slipped 1.1%, lead fell 0.4% and tin dipped 0.1%.
The LME will be closed on Monday for a bank holiday.
Those metals on the SHFE traded mixed on Friday night. Nickel slid 1.5%, copper fell 0.6% and aluminium lost 0.1%, while zinc inched up 0.06%, lead advanced 0.5% and tin rose 0.8%.
On Friday, China released draft legislation over new national security measures on Hong Kong after last year’s burst of anti-government protests in the city, which drew a warning from US President Donald Trump that Washington would react “very strongly.”
The draft law was announced at the annual National People’s Congress (NPC), the Chinese parliament, which kicked off on Friday, and grew concerns over ties between Washington and Beijing which have worsened during the coronavirus pandemic. The US has ramped up its criticism of China, blaming it for the spread of the virus, which originated in the city of Wuhan in central China.
Last week, the US government moved to block global chip supplies to blacklisted telecoms equipment maker Huawei Technologies. The US Senate also passed legislation that could prevent some Chinese companies from listing their shares on US exchanges.
China also opted against setting a GDP target for 2020 as the Covid-19 batters its economy, sparking concerns that the pandemic will cap fuel demand in the world’s second-largest oil user and weighing on oil prices Friday.
The US rig count, an early indicator of future output, fell by 21 to a record low 318 in the week to May 22, according to data on Friday from energy services firm Baker Hughes Co going back to 1940.
In Europe, UK borrowing soared to a record high of £62.1 billion ($75.8 billion) in April, according to figures published Friday, while retail sales fell by a record 18% as the coronavirus pandemic decimated the economy.
Germany’s first-quarter GDP and May Ifo business climate index are set to be released on Monday.