Once again, the rise in government bond yields is acting as the catalyst for the sell off in stocks.
The most prominent event today were the severing of diplomatic relations with the State of Qatar by Saudi Arabia, Egypt, the United Arab Emirates, Bahrain, Yemen and Libya accusing it of supporting terrorist organizations and opening the door to the worst years of dissension among some Arab countries. This decision has had a significant impact on the movements of the Gulf stocks, especially the Qatari bourse, which its main index lost more than 7% of its value, and had an impact on oil prices, which fell during trading today being traded near the lowest levels last Friday at 47$ per barrel.
US employment data dominated the events last week, but disappointed markets. This week, the markets are heading towards the UK, where the general elections will be held next Thursday and the results of those elections will play a role in the process of Brexit negotiations with the EU.
The beginning of the week was largely quiet, and there were no noticeable or strong moves in light of the official holidays of some markets. The highlight was the testimony of Mario Draghi, Governor of ECB before the European Parliament, who stressed the need for the stimulus program as inflation remained far from the desired levels and it is too early to talk about the beginning of tapering.
Manufacturing data for SMEs was below expectations in China. The Caixin PMI Index recorded only 49.6 points in May, marking the first contraction in factories output for almost a year. This weakness is likely to be temporary under constant signs of improvement in International Economy.
By the end of May, Asian stocks capping a fifth consecutive month of gains as Chinese factory activity data showed steady growth to ease market fears about the slowdown of the world's second largest economy. China's manufacturing sector grew by 51.2 points in May.
The euro fell today, following news from a German newspaper that Greece may fail to pay a loan due in July if lenders fail to resolve Greek debt relief. The finance minister said his remarks had been distorted and that Greece was confident of reaching an agreement on June 15 when Eurozone finance ministers would meet again next month, wiping out the euro's losses since the beginning of the day.
Markets have been relatively calm today in the light of official holidays in a number of markets such as China, the United States and the United Kingdom. The main economic event today were the testimony of Mario Draghi, Governor of the European Central Bank
After the suffering of the US dollar over the past two weeks, can the US jobs report provide enough support for the dollar again? There will also be a number of important economic data during this week which will have an impact on the movements of the market, and now we will take a look at the figures for this week's awaited:
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