The FTSE 100 looks set to make a subdued start to proceedings with inflation worries starting to bubble under the surface once more.
Treasury Secretary Janet Yellen reignited the debate with comments suggesting slightly higher interest rates may be a price worth paying for the economic stimulus envisaged by the Biden administration.
The yields on the 10-year US government bond crept higher overnight, while Asia’s main markets were mainly lower. Stock futures pointed to a down day for Wall Street too.
Still, the economic indicators are not uniformly pointing to an overheating American economy.
Friday’s non-farm payrolls significantly undershot expectations with workers happy to draw benefits than return to the world of employment.
“This flies in the face of optimism that the economic reopening would prompt a rehiring blitz, making it much less likely that the Fed will look at an early tapering of asset purchases,” said Michael Hewson of CMC Markets.
“This lack of a pickup in hiring trends tends to suggest that the generous unemployment benefits from the March stimulus package are acting as a brake on workers returning to the workforce and that it will be quite some time before the Fed sees substantial further progress in hiring trends.
“While some US states are already cutting back on some of the benefits, it could well be September before these effects start to dissipate when the current benefit programme expires.”
Back here in the UK, the corporate news flow looks to be slowing to trickle with updates from British American Tobacco (LON:BAT), fashion chain Ted Baker (LON:TED) and retailer SSP (LON:SSP) representing the week’s highlights.
On the markets
Pound US$1.4143 (-0.1%)
Bitcoin US$36,208.63 (flat)
Gold US$1,889.40 (-0.14%)
Brent crude US$71.53 (-0.53%)
6.50am: Early Markets - Asia / Australia
Stocks in the Asia-Pacific region were mixed on Monday as China’s exports rose 27.9% in May as compared with a year earlier, lower than forecasts by analysts in a Reuters poll for a 32.1% year-on-year jump.
The Shanghai Composite in China slipped 0.07% and Hong Kong’s Hang Seng index fell 0.54%
In Japan, the Nikkei 225 rose 0.31% while South Korea’s Kospi gained 0.48%.
Shares in Australia dipped, with the S&P/ASX 200 trading 0.7% lower.
Proactive Australia news:
Okapi Resources Ltd (ASX:OKR) has started a drilling program at two priority targets within the Enmore Gold Project in north-eastern New South Wales.
Global Energy Ventures Ltd (ASX:GEV) (FRA:WS9) has started developing a pilot-scale compressed hydrogen (C-H2) cargo ship to capitalise on green hydrogen opportunities across Europe and the Asia Pacific.
Emyria Ltd (ASX:EMD) has revealed that clinical data from one of its personalised care plans for opioid users has been validated in a world-first data linkage project.
Kazia Therapeutics Ltd’s (ASX:KZA) (FRA:NV9M) (NASDAQ:KZIA) phase-II study of paxalisib in Primary CNS Lymphoma has been initiated at Dana-Farber Cancer Institute in Boston, Massachusetts, with the first patient enrolled to the study.
QMines Ltd (ASX:QML) (FRA:81V) is well placed to benefit from the expected uptick in copper demand over the next decade, driven by electric vehicle makers and green environmental policies – particularly in Europe.
Platina Resources Ltd (ASX:PGM) (OTCMKTS:PTNUF) (FRA:P4R) is moving towards the exploration phase at Xanadu Gold Project after executing binding purchase agreements and commencement of tenement transfers.
Tempus Resources Ltd (ASX:TMR) (CVE:TMRR) (OTCMKTS:TMRFF) (FRA:4W0) has kickstarted a drilling campaign at its Elizabeth Gold Project in southern British Columbia, Canada.
FYI Resources Ltd (ASX:FYI) (OTCMKTS:FYIRF) (FSE:SDL) has adopted an environmental, social and governance (ESG) framework in a bid to improve shareholder outcomes from its kaolin and high purity alumina (HPA) assets.
South Harz Potash Ltd (ASX:SHP) non-executive director Len Jubber has demonstrated his confidence in the company's potash strategy by purchasing shares in an on-market transaction.