Yahoo Finance Day Ahead: Top 3 Things to Watch
Investing.com - Here’s a preview of the top 3 things that could rock markets tomorrow
1. U.S. Inflation Data on Tap
As the Trump-Kim summit is expected to dominate news flows, the release of core inflation could steal some of the spotlight ahead of Wednesday's widely expected Federal Reserve rate hike.
Economists expect the core consumer price index (CPI) due 08:30am ET, to show unchanged growth of 0.1% for May, while core year-on-year CPI is expected rise 2.2% from 2.1% in April.
An uptick in the pace of inflation has reignited investor expectations for a faster pace of rate hikes, as analysts at Goldman Sachs claimed the market was not fully pricing the prospect of more aggressive rate hikes.
The Fed hike path is much more hawkish than futures market pricing, Goldman Sachs said, forecasting three and four rate hikes in 2018 and 2019, respectively, with the risk of four rate hikes in 2019 skewed to the upside.
The dollar made a subdued start to the week despite bouncing off session lows which followed a retreat in the EUR/USD.
2. API Data, OPEC Monthly Report Eyed
The monthly OPEC report due Tuesday is likely to garner special attention after WSJ reported Friday Saudi Arabia had increased production by more than 100,000 barrels a day in recent weeks.
OPEC's estimate on non-OPEC output will also be closely watched after the oil-cartel in its previous report predicted non-OPEC supply would rise by a further 80,000 barrels per day this year to 1.71 million barrels.
On the domestic front, a fresh batch of crude oil inventory data from the American Petroleum Institute (API) due Tuesday will also be in focus as recent data on weekly crude supplies has contrasted from the Energy Information Administration's report – released a day later Wednesday.
The American Petroleum Institute reported last Tuesday crude oil stockpiles fell by 2.028 million barrels. That was in sharp contrast to the Energy Information Administration report showing crude supplies rose by 2.9 million barrels.
Oil prices pared losses Monday as Iraq's oil minister warned producers against easing limits on production curbs.
Crude oil futures on Monday settled 36 cents higher at $66.10 a barrel.
3. Trump-Kim Face-to-Face Looms
U.S. President Donald Trump and North Korea Chairman Kim Jong Un are slated for a historic face-to-face meeting in Singapore on Monday 9PM ET.
Ahead of the meeting, preliminary talks between the two nations were making quick progress, the White House said.
Following the initial greeting, President Trump and Chairman Kim will participate in a face-to-face meeting, an expanded bilateral meeting, and a working lunch.
The United States is seeking a firm commitment from Kim Jong Un for complete denuclearisation. While Kim reportedly wants the United States to loosen its crippling economic sanctions against North Korea.
Trump's expectations for a prolonged meeting with Kim were unexpectedly cut short, however, after the North Korean leader set a deadline for ending talks in Singapore.
Any potential signs of a setback in talks could pressure risk appetite, stoking demand for safe-havens such as the yen, Swiss franc and Gold Futures.
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