FTSE flat, investors eye U.S. retail sales, consumer confidence

The FTSE rally has taken a pause in the Thursday session. Currently, the index is trading at 7,366, down 0.01% on the day. On the release front, U.S. unemployment claims was unexpectedly high, climbing to 222 thousand. This was the highest reading in five weeks. On Friday, we could see some movement on the stock markets, as the U.S. releases retail sales and consumer confidence reports.

It’s been a quiet week for the FTSE, after huge gains of 2.67% last week. Investors have shrugged off rising tensions in the Middle East, with further attacks on oil tankers in the Persian Gulf. Investors appear more focused on the upcoming consumer spending reports. Retail sales and core retail sales are expected to post strong gains in May, with estimates of 0.7% and 0.5%, respectively. If the estimates are on target, equity markets could move higher on Friday.

As expected, consumer inflation in the U.S. remained soft in May. CPI slowed to 0.1%, down from 0.3% in the previous release. This matched the estimate. The core reading posted a gain of 0.1% for a fourth straight month, shy of the forecast of 0.2%. With the May inflation numbers remaining low, there could be more pressure on the Fed to lower interest rates in order to boost economic activity and inflation. The likelihood of further rates this year is increasing – the CME Group has set the odds of a July cut at 66% and another cut in September at 50%. Lower interest rates make the U.S. dollar less attractive to investors, so investors will be keeping an eye on alternative assets.

WTI crude – Spikes on reported tanker attacks

Stocks stabilize as markets await trade and Hong Kong developments; Oil Surges on tanker attacks in Middle East

US-China Trade Tensions Impact US Retailer Confidence

Economic Calendar

Thursday (June 13)

• 8:30 US Unemployment Claims. Estimate 215K. Actual 222K

Friday (June 14)

• 8:30 US Core Retail Sales. Estimate 0.5%
• 8:30 US Retail Sales. Estimate 0.7%
• 10:00 US Preliminary UoM Consumer Sentiment. Estimate 98.1

*All release times are DST

*Key events are in bold

FTSE, Thursday, June 13 at 12:10 DST

Previous Close: 7,367 Open: 7,357 High: 7,398 Low: 7,353 Close: 7,366

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