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# Brexit ve #BRIC yarasalar yaz tatilinden önce

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British lawmakers broke up for the summer holidays on Tuesday (24 July) but before they went, parliament's Brexit committee organized some end-of-term entertainment – grilling insurers over the progress (aynen) of Brexit müzakereleri, yazmak Jon Boyle ve Sujata Rao.

Also up before the honourable members are Britain’s new Brexit minister, Dominic Raab, and Prime Minister Theresa May’s powerful adviser on Europe, Olly Robbins.

Could be a fascinating piece of political theatre, given the swirling talk of Brexit betrayal around recent votes in parliament that May only won by giving into hardline eurosceptics in her own party and threatening pro-EU Conservative MPs with a snap election.

Bu arada Çin Devlet Başkanı Xi Jinping visited South Africa on Tuesday (24 July) for a state visit ahead of a BRICS summit later in the week.

 

As Donald Trump’s trade wars send shock waves through the world’s economies, leaders from Brazil, Russia, India, China and South Africa are expected to band together at a summit in Johannesburg in defence of the multilateralism the United States once championed.

'America First' is now the mantra in the White House and if Trump doesn’t like whatever the BRICS decide, we can expect a tweeted broadside, in capitals letters if he’s really miffed.

reklâm

Bond bulls are still wary following the sudden 10 bps steepening in the Japanese yield curve (which elicited similar moves in Europe and the United States) but things are slightly calmer this morning, with Japanese yields easing off the six-month highs and 10-year Treasury yields too backing off five-week highs around 2.96 percent.

Some reckon the Bank of Japan could announce some policy tweaks at its 31 July meeting. But this morning’s factory activity data has been disappointing, slowing to 1-1/2 year lows, suggesting either that trade tensions are already having an impact or that the economy is not really  improving. That’s pushed the yen off two-week highs and the Nikkei is half a percent higher.

Google reassured on the earnings front, with shares rising more than 3% in afterhours trade and setting Wall Street up for a rise later today. And there’s been a sizeable bounce in Chinese stock markets as the government promised a “vigorous fiscal policy including company tax cuts”, while the Google effect is making itself felt across Asian tech. Asian tech index is up only 0.2% however and world MSCI shares remain flat and Europe has opened firmer on back of some decent earnings.

Japan aside, what about the growth picture elsewhere? Eurozone flash PMIs are due today and analysts appear resigned to another decline in July – PMIs have fallen every month this year – and the United States too reports flash PMIs later in the day. French PMIs are already out and are below forecast. Finally on the earnings front on Wall Street expect Verizon, AT&T, McDonald’s, ElliLilly and Trump’s beloved Harley Davidson.

Friday (27 July) brings a key US Q2 GDP number, with talk already swirling that annualized growth could be well above the 4.1% forecast by analysts. Those expectations coupled with the Japanese moves yesterday have fuelled a 10 bps steepening in the Treasury 2-10 yield curve off  the flattest levels in a decade and driven the dollar out of losses brought on by the BOJ jitters and President Trump’s comments bemoaning greenback strength.

Strong data this week could provide further support. The dollar mini-bounce alongside fresh easing measures by Beijing – it announced a $74 billion liquidity injection and promised tax cuts – have pushed yuan back to a new one-year low. Other Asian currencies have followed suit while the euro and sterling have also retreated a touch versus the greenback.

Meanwhile on the trade front, European Commission President Juncker arrived in DC for a Wednesday (25 July) meeting with Trump. But the commission said Juncker would not be arriving at the White House with any specific offers. In Britain, parliament breaks today for summer recess so there could be some let-up in the Brexit noise.

Tech was likely to be the key driver after Google parent Alphabet beat forecasts overnight, and European front chipmaker and iPhone supplier AMS struck an upbeat tone in its earnings outlook, and shares are up almost 10 percent.

French carmaker PSA is up 10% after a strong earnings beat after the newly acquired Opel-Vauxhall business returned to profit. It’s a heavy week for auto earnings which are particularly under scrutiny this quarter after the shares were dented by US import tariff threats.

Another unloved sector this year, banking stocks, could also see a boost after UBS.  On tariff watch, aluminium producer Norsk Hydro provided an interesting look at how steel tariffs are impacting the industry. The Norwegian company said it saw a bigger global aluminium deficit in 2018 with market uncertainty due to US tariffs and sanctions on Rusal continuing. NH shares have risen 3%.

In emerging markets, stocks have bounced half a percent led by China and tech-heavy Korea and Taiwan but currencies remain under pressure from the firm dollar, weak yuan and trepidation that developed central banks are on the road to tightening policy. Checking for impacts on Iraqi and Pakistani assets on the back of Islamic state resurgence ve election-linked violence.

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