A look at the day ahead in U.S. and global markets from Mike Dolan
Wall Street returns from its midweek break to find record high stocks still chomping at the bit, with overseas monetary easing in focus as the Swiss cut interest rates for the second time this year and the Bank of England decision now awaited.
With artificial intelligence still the dominant driver stateside, Nvidia (NASDAQ:NVDA)'s vault on Tuesday to become the world's most valuable company offers the latest twist. It's stock was another 1% higher again before Thursday's bell and S&P500 futures were up 0.4%.
With the dollar buoyant across the piece, China continued to offer a nervy counter point to ebullient world markets.
The offshore yuan skidded to its weakest level of the year even as the People's Bank of China left its interest rate setting unchanged and Chinese stocks once again bucked the world trend.
Down again on Thursday, mainland Chinese stocks have now underperformed the wider MSCI all-country index by some 8% this year.
With the PBOC guiding the onshore yuan lower at its daily fixing, concern is growing that currency weakness is preventing it from easing monetary policy to address the ongoing housing bust.
And it also comes in tandem with fresh weakness in Japan's yen, which hit its lowest since the Bank of Japan intervention in April despite warnings of repeat action.
Putting the French political upheaval aside for the time being, European stocks were higher - helped by the latest interest rate cut on the continent.
The Swiss National Bank cut its main policy rate on Thursday for the second time this year, maintaining the central bank's position as a frontrunner in the global policy easing cycle and sending the Swiss franc lower and Swiss stocks higher.
The latest quarter point cut to 1.25% has been almost 70% priced by money markets in advance and another quarter point easing is expected by yearend.
Norway's central bank was not for budging, however, and held the line - more worried about spikier inflation there.
Attention now switches to the Bank of England, which announces its latest decision on Thursday too. Not least with July 4's British election around the corner, the BoE is expected to stand pat for now - with a one-in-three chance of a cut at its next meeting on August 1 now seen in money markets.
Even though headline UK inflation hit the BoE's 2% target for the first time in three years last month, 'core' rates remain well above 3% and services inflation is even stickier. The BoE monetary policy committee is expected to be split 7-2 in favour of holding rates - as it was last time around.
Sterling was a touch lower against the pumped up dollar ahead of the decision - but up against the euro.
In Europe, French stocks were firmer and the French government debt spread with Germany steady after the European Union warned on excessive French and Italian budget deficits as expected on Wednesday - upping the ante into the snap French parliamentary elections over the next month.
Back on Wall St, Treasury yields were a touch higher into the re-open on Thursday - with housing data in focus but also a keen eye on weekly jobless numbers to see if last week's outsize jump was sustained.
The only number released during the "Juneteenth" market holiday on Wednesday was a weaker-than-forecast NAHB housing sentiment indicator for June.
In company news and deals, Britain's Tate & Lyle (OTC:TATYY) fell 6.5% after the food ingredients maker said it will buy U.S.-based CP Kelco for $1.8 billion from J.M. Huber Corporation.
And UK bank NatWest struck a deal to acquire most of the banking business of retailer Sainsbury's, in a deal that would increase the British lender's assets by 2.5 billion pounds ($3.2 billion).
Key developments that should provide more direction to U.S. markets later on Thursday:
* Bank of England policy decision
* US May housing starts/permits, weekly jobless claims, June Philadelphia Fed business survey, US Q1 current account; Euro zone June consumer confidence
* San Francisco President Federal Reserve President Mary Daly Richmond Fed President Thomas Barkin and Minneapolis Fed chief Neel Kashkari all speak
* Eurogroup meets in Luxembourg, with European Central Bank President Christine Lagarde and ECB board member Piero Cipollone attending
* US corporate earnings: Accenture (NYSE:ACN), Kroger (NYSE:KR), Jabil, Darden Restaurants (NYSE:DRI), Smith & Wesson, Aurora Cannabis (NASDAQ:ACB), Algoma Steel, Mynaric
(By Mike Dolan, editing by Editing by William Maclean mike.dolan@thomsonreuters.com)