Market Movers
Focus to stay on Greece following positive news yesterday (see more below). The 'Institutions' are expected to work hard towards a final agreement during the coming days, hence the news flow is likely to continue while we are waiting for another Eurogroup finance minister meeting on Wednesday and the EU leaders summit Thursday-Friday. The aim is for the Eurogroup to reach a deal, which can be signed by the leaders at the EU summit.
Euro-area manufacturing PMI is expected to decline as suggested by the ZEW expectations. Although it has a reputation as only describing the stock market, it has been good at signalling a change in the trend in both Ifo expectations and manufacturing PMI. The German manufacturing PMI should show a modest decline as recent hard data have been good. The current trend in euro-area service PMI is lower, which likely stems from the headwind to consumers from the higher oil price.
US durable goods orders for May are due for release. The core measure, non-defence capital goods orders ex aircraft, has been depressed since mid-last year, which is surprising since businesses have added to payrolls. As the recovery progresses, we expect business fixed investments to pick up pace and the durable goods orders report will give an indication of whether this was the case in May.
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